Justice Department Says It Will Reopen Inquiry Into Realtor Trade Group

[Account Closed]

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.

[Calvin Thomas]

[Jay Hinrichs]

Quote from @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.

WE deal with this all the time of course selling our new construction homes.. And for my wife who is our listing agent and actually has to build the pre sales for these  buyers.. Agents come in all flavors we are closing one next week. Where the buyers Daughter is an agent and she is a Doctor literally an MD.. now she has been good to work with others not so much.  sometimes though the ones who are the most experienced and think they know it all are the hardest ones to work with they are too busy to really take the time their buyers need to help through the build process.. so its hard to paint a brush over every agent.. And of course agents have to start somewhere.. just like MLOs to become a lender is not that much harder than an agent.. I mean I passed the national and state test and I have never in my life done a conventional residential loan.. But what I do like is the FbI back ground and having to provide a financial statement.. I don't think you have to do that to get an RE license.  Also on reciprocal state licenses for RE brokers  I took the Broker test in MS and it was thirteen questions ( 13)  took me five minutes. LOL. I needed it so I could do my own auction when in 2010 when I had 20 or so OREO props in Jackson MS..

I totally agree with you on Dodd Frank 2.0  

[Jack Seiden]

Quote from @Account Closed:

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...

Given that the lawsuit no longer requires members to be members of nar or the local mls’s I’m not sure the doj can really move the needle anymore than the settlement in the sitzer case by farther going after nar, to the extent they want farther changes, it’s probably wrangling state licensing boards.

[Calvin Thomas]

Quote from @Jay Hinrichs:

Quote from @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.

WE deal with this all the time of course selling our new construction homes.. And for my wife who is our listing agent and actually has to build the pre sales for these  buyers.. Agents come in all flavors we are closing one next week. Where the buyers Daughter is an agent and she is a Doctor literally an MD.. now she has been good to work with others not so much.  sometimes though the ones who are the most experienced and think they know it all are the hardest ones to work with they are too busy to really take the time their buyers need to help through the build process.. so its hard to paint a brush over every agent.. And of course agents have to start somewhere.. just like MLOs to become a lender is not that much harder than an agent.. I mean I passed the national and state test and I have never in my life done a conventional residential loan.. But what I do like is the FbI back ground and having to provide a financial statement.. I don't think you have to do that to get an RE license.  Also on reciprocal state licenses for RE brokers  I took the Broker test in MS and it was thirteen questions ( 13)  took me five minutes. LOL. I needed it so I could do my own auction when in 2010 when I had 20 or so OREO props in Jackson MS..

I totally agree with you on Dodd Frank 2.0  

 It's Mississippi...  What did you expect?  lol.

[Jay Hinrichs]

Quote from @Calvin Thomas:

Quote from @Jay Hinrichs:

Quote from @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.

WE deal with this all the time of course selling our new construction homes.. And for my wife who is our listing agent and actually has to build the pre sales for these  buyers.. Agents come in all flavors we are closing one next week. Where the buyers Daughter is an agent and she is a Doctor literally an MD.. now she has been good to work with others not so much.  sometimes though the ones who are the most experienced and think they know it all are the hardest ones to work with they are too busy to really take the time their buyers need to help through the build process.. so its hard to paint a brush over every agent.. And of course agents have to start somewhere.. just like MLOs to become a lender is not that much harder than an agent.. I mean I passed the national and state test and I have never in my life done a conventional residential loan.. But what I do like is the FbI back ground and having to provide a financial statement.. I don't think you have to do that to get an RE license.  Also on reciprocal state licenses for RE brokers  I took the Broker test in MS and it was thirteen questions ( 13)  took me five minutes. LOL. I needed it so I could do my own auction when in 2010 when I had 20 or so OREO props in Jackson MS..

I totally agree with you on Dodd Frank 2.0  

 It's Mississippi...  What did you expect?  lol.

I expected 25 questions at least :)..  who thought only 13 was the right number.. its was strange..  But you know it puts a lot of pressure on you.

being that you had to get 75 or 80% on the test you could only miss a few !!!

[Teri Feeney Styers]

 @Doug Smith and @Jay Hinrichs in Colorado the schooling and testing has a much higher bar. Our required contracts include spelled out options on how a seller will pay a commissions and how the listing agent will (or will not) split that money with a buyer's agent. On our contract to purchase there is a whole section regarding the buyer's agent and who will pay them and the seller's agent and who will pay them. We are pretty transparent. When I read about the "listing" contracts offered to the original sellers in Missouri who started the lawsuit I about fell off my chair - I would sue too! I agree with Doug - this will be very detrimental to buyers. Some will believe they can handle the transaction themselves and will either end up under represented or the listing agent will end up doing double duty to keep deals together. VA buyers will need to beg sellers to pay their Realtors. All truly professional agents will need to work extra hard to explain to sellers why it is in their best interest to offer compensation to buyer's agents. AND agents need to remember that the commission/compensation has always been negotiable. Do I work twice as hard to sell a $1m house as I do a $500k house? Probably not - as house prices (the pie) have risen our slice of the pie has remained the same. Perhaps agents need to reconsider that and offer some tiers and some capped rates. Just sayin...