Realtors to share data on listings
Online real estate brokers declared victory Tuesday after the country’s main real estate group agreed to give some Internet rivals access to the for-sale listings gathered by traditional agents.
The agreement between the Justice Department and the National Assn. of Realtors, which requires court approval, could enable home buyers to save thousands of dollars on a purchase.
For years, real estate brokers have resisted sharing some of the data in their more than 800 multiple-listing services with their Internet-based competitors. If the agreement goes into effect, online shoppers will get a more accurate count of the homes for sale in a given area and Internet companies will be able to better compete with their bricks-and-mortar rivals.
“Hallelujah,” said Glenn Kelman, president of online broker Redfin.com. “If they hadn’t done that, we’d have died a slow, grisly death” because the website probably wouldn’t have had enough listings to survive.
The Justice Department sued the Realtors over what it said were anti-competitive policies that kept consumers’ costs artificially high by hampering the ability of competitors to sell homes and condominiums.
“Today’s settlement prevents traditional brokers from deliberately impeding competition,” said Deborah Garza, deputy assistant attorney general in the Justice Department’s antitrust division, in a statement. “When there is unfettered competition from brokers with innovative and efficient approaches to the residential real estate market, consumers are likely to receive better services and pay lower commission rates.”
The Realtors group had contended that its policies were fair and that competition in the industry was healthy. Lucien Salvant, head of public affairs for the association, said the settlement agreement wasn’t so much a victory for Internet real estate data providers as it was a “win-win” for brokers and consumers.
The association didn’t admit any liability or wrongdoing and will make no payments in connection with the settlement. “The Department of Justice did not find any evidence of anti-competitive behavior,” Salvant said.
The Realtors won a concession in that the agreement says that only someone who actively represents buyers and sellers can have access to multiple-listing services’ numbers. That rules out websites that profit through advertising -- not through real estate sales -- and attract viewers by offering home price estimates, maps and other information.
“Some brokers became members to download the MLS but were not selling, just profiteering,” Salvant said.
Kelman of Seattle-based Redfin said his company “has been thirsty for MLS data for at least a decade” and had based its business model on a gamble that such a settlement was possible. With such an agreement in place, further investment in technology makes sense.
The deal with the Justice Department won’t necessarily bring down brokers’ fees, which are traditionally 6% of the purchase price, cautioned Michael Davin, president of Catalist Homes Inc., a discount residential sales broker based in Hermosa Beach.
“Nothing in the ruling drives fees down,” Davin said. “What it does is remove barriers to organizations that are lowering fees. What was at stake here was the ability for consumers to be able to search for housing online and gain access to the total MLS.”
Davin said the settlement was “not a monumental victory” but important because “it protects the whole online industry of home marketing that allows consumers to become more self-empowered. In 20 years you’ll wonder why we ever sat in the back of a Realtor’s car.”
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