May 9, 2005
The Justice Department is prepared to sue the National Association of Realtors, charging that is policies are driving up home prices, illegally restricting discounting of sales commissions and putting online competitors at a disadvantage, The Wall Street Journal reported.
The Journal quoted lawyers involved in the case as saying that the Justice Department would charge that the Realtors, in a proposed 2003 bylaw, illegally adopted rules that would discourage new real estate sales practices, including home sales over the Internet and discounted realty services.
Realtors now charge 6%, divided between the buying and selling agents.
The bylaw change would allow Realtors to withhold their listings from online brokers. The change is scheduled to take effect this July. The date has been pushed back several times as the Federal Trade Commission and Justice Department tried to jawbone the Realtors.
Government attorneys have also taken issue with Realtors' attempts to get state legislatures and licensing bodies to enact rules that block low-commission competitors, including fixed-price listing agents.
With home sales at record levels -- $61 billion last year -- many consumers are finding themselves priced out of the market, while Realtors' commissions have hit stratospheric levels.
