February 6, 2007
The Federal Trade Commission has settled antitrust charges brought against a group of real estate brokers in southeastern Michigan. The FTC had accused the brokers of violating antitrust laws by blocking certain property listings from the MiRealSource Multiple Listing Service (MLS).
The brokers allegedly banned property sellers whose contract with their real estate brokers did not match the terms dictated by the Realtors organization.
The FTC also charged the 7,000-member MiRealSource group with enforcing a range of other rules designed to limit the acceptance, publication, and marketing of certain residential real estate listing contracts, thereby limiting home sellers' ability to choose the real estate brokerage services that best met their specific needs.
Under the FTC consent order settling the complaint, MiRealSource has agreed to abandon such collusive conduct and provide its services to all member brokers representing potential home sellers, regardless of the type of listing contract that they choose.
The commission's complaint against MiRealSource was announced last fall as part of a larger real estate competition law enforcement sweep. Of the cases announced at that time, all have settled, except one that remains in litigation.
As with the six prior consent orders the Commission has announced in this area, this enforcement action will have a direct positive impact on real estate consumers, said Jeffrey Schmidt, Director of the FTC's Bureau of Competition. By requiring MiRealSource to discontinue its anticompetitive rules, the order will allow home buyers and sellers to choose the real estate brokerage services that they wish to purchase.
Types of Real Estate Listings
Under the traditional type of listing agreement, known as an Exclusive Right to Sell Listing, the property owner appoints a real estate broker for a set period of time as an exclusive agent to sell the property, and agrees to pay the listing broker a commission if and when the property is sold, regardless of whether the broker or the homeowner caused the sale.
An alternative form of listing agreement, often used by home sellers who do not wish to purchase the full range of brokerage services, is the Exclusive Agency Listing, which makes the listing broker the exclusive agent of the property owner, but gives the property owner the right to sell the property without extensive help from the listing broker.
Under an Exclusive Agency Listing agreement, the listing broker often charges an up-front fee, but may receive a reduced commission, or no commission at all, if the owner sells the property without the broker's further help.
