Justice Department Says It Will Reopen Inquiry Into Realtor Trade Group

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Justice Department Says It Will Reopen Inquiry Into Realtor Trade Group

On Friday, the U.S. Court of Appeals for the District of Columbia made a ruling that opens the door for a renewed investigation into the National Association of Realtors.

The Justice Department will reopen an antitrust investigation into the National Association of Realtors, an influential trade group that has held sway over the residential real estate industry for decades. The investigation will focus on whether the group’s rules inflate the cost of selling a home.

The renewed federal inquiry comes after the U.S. Court of Appeals for the District of Columbia on Friday overturned a lower-court ruling from 2023 that had quashed the Justice Department’s request for information from N.A.R. about broker commissions and how real estate listings are marketed.

https://www.nytimes.com/2024/04/05/realestate/doj-realtors-n...

[Doug Smith]

This is turning into Dodd Frank 2.0. There are issues in the realty industry...primarily the fact that the barrier of entry is so incredibly low to get a license and the vast majority of agents don't hone their crafts. They don't learn the tricks of the trade or understand the rules, laws, and contracts. That being said, there are some amazing professionals that bring a great deal of value and really protect their clients...and save/make them $$$. I often hear great agents say they regularly hear "I would love to use you as my agent, but my neighbor's 19 year-old daughter that is working at Starbuck's just got her license, so I feel compelled to use her." News flash, if someone with experience is on the other side, you're gonna get fleeced. I've been a lender for 33 years and I really remember Dodd Frank. In an attempt to clean up the industry, legislation was written by those who 1) had never been lenders themselves and had no understanding of the industry and 2) their biggest campaign contributors were big banks (look up Barney Frank, Chris Dodd, and Elizabeth Warren's campaign contributors at the time and you'll see big banks). Dodd Frank really helped big banks by, in the name of "helping consumers", added so many regulations on small banks and smaller lenders (basically big bank competition) that it hurt consumers. It did, however, clear out some bad actors, so it wasn't all bad. In this NAR lawsuit, the proposed settlement does something that needs to happen...it makes buyer's agents (known as selling agents) get a buyer's agreement in place. The media and social media keyboard warriors have really mischaracterized what it does. A seller CAN offer $ to pay a buyer's agent...it just can't be shown on the MLS. It does not, however, raise the barrier of entry for real estate agents nor does it do anything about the crappy continuing ed classes that agents take. I have a license and have to do it, but all classes pretty much say the same thing over and over every year. The industry MUST weed out the weekend warrior agent if consumers are to be protected. It also has a massive hole for VA buyers. The VA won't allow a Vet to pay their realtor. Why would a realtor work with a customer for free. That puts Vets at a severe disadvantgage. Something's gotta give on that. One of my knocks on sites like BP is that it gives novice investors the illusion that they can DIY it and go up against an experienced Agent or seller without getting fleeced. It's a great place to learn and ask questions, but you still need your professional advice. The buzz around this NAR Settlement is not only wrong, but it's going to dangerously put buyers at a severe disadvantage when they go up againts experienced Agents and Sellers. The way the settlement is written, this is NOT good for consumers.