Last month, a Missouri court found the National Association of Realtors and two brokerage firms liable for $1.8 billion in damages related to the way they collected fees from their members. Two North Texas companies have filed similar lawsuits against the Texas Association of Realtors.
The lawsuit also names real estate associations in Austin, Dallas-Fort Worth, Houston and San Antonio, and was filed Monday by Granbury-based QJ Homes LLC and Dallas-based Five Points Holdings LLC. Also mentioned are several other local brokerages or their parent companies, including Dave Perry-Miller and Associates and his Ebby Halliday Realtors.
In October, a Missouri court found that NAR conspired to artificially inflate real estate agents' fees. HomeServices of America and Keller Williams Realty were co-defendants in the lawsuit. However, Re/Max and Anywhere Real Estate were also initially named in the lawsuit before reaching a settlement.
NAR and the brokerage firm say they intend to appeal the ruling.
At the heart of the Texas v. NAR case is the practice of paying real estate agents commissions for helping their clients buy and sell real estate. Typically, his 3% of the sale goes to the buyer's agent and another 3% goes to the seller's agent. NAR's lawsuit alleged that the NAR organization forces home sellers to pay these fees as a condition of listing their home on a local multiple listing service (accessed only by real estate agents). Plaintiffs argued that the MLS and other tactics limit price competition so that each real estate agent can continue to collect the 3% levy on each transaction.
“The conspiracy centers on enforcing anticompetitive regulations that force home sellers to pay high commissions to brokers representing real estate buyers, in violation of federal antitrust laws.” states the Texas lawsuit. He names NAR as a co-conspirator, but not as a co-defendant.
The lawsuit also says brokers and real estate agents are under pressure to join NAR and follow NAR practices as a prerequisite to doing business. As part of these practices, home sellers are required to pay commissions that should be paid by home buyers, the report said.
“Additionally, this has led to an industry-accepted practice called 'steering,' where homeowners are forced to avoid inflation or They are pressured to accept stable interest rates,” the complaint states.
“Texas' fee structure forces home sellers to pay both buyer and seller agents, forces a single source of listings through the MLS, and creates a conspiracy of silence within the industry. ” said plaintiff's attorney Julie Pettit. In a statement. “This corrupt system violates federal law and is frankly outdated given the available technology and realities of home buying today.”
NAR maintains that the fee practice is not mandatory and is in the “best interest of consumers.”
“In court, NAR presented evidence that because of our rules and a well-functioning local MLS broker market, consumers are better off and business competition can thrive,” the group said in October. said.
In a memo to agents, the Metrotex Association of Realtors named in the latest lawsuit directed them to communicate the value of using real estate agents in transactions and called the lawsuit a “copycat” of the NAR lawsuit. .
“NAR's position, supported by MetroTex, is that collaborative compensation practices enable efficient, transparent, and accessible markets. Sellers sell their homes for more and get more for their homes. “We allow buyers to see their own homes, buyers have more home options, and can afford an agent,” the memo said.
QJ Homes and Five Point Holdings filed suit in the US District Court for the Eastern District of Texas in Sherman, citing the Sherman Antitrust Act and the Texas Deceptive Trade Practices Act. They filed a class action lawsuit against home sellers who used agents or brokers to list their properties on the Texas MLS from November 13, 2019 to the present, along with one of the 29 defendants named as plaintiffs. seeking the position of
Meanwhile, U.S. District Judge Stephen Baugh in Missouri indicated that post-trial deliberations will likely keep NAR's case in court until the spring. The Texas lawsuit is unlikely to resolve the thorny issue of home purchases and fees anytime soon.
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Bethany Erickson
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Bethany Erickson is D Magazine. Throughout her career, she has written about real estate, education policy, the stock market, and crime, sometimes simultaneously. She hates lima beans and 5 a.m. and takes her SAT practice tests for her fun.
