The National Association of Realtors (NAR), a well-known trade association for the real estate sector, and multiple residential brokerages have been found liable for roughly $1.8 billion by a Missouri jury in a landmark decision. The ruling, which was delivered on Tuesday, is a major development for the real estate market and causes ripples across the business.
Homebuyers filed the main lawsuit in this case, claiming that the NAR and large residential brokerages had engaged in anti-competitive behavior that increased commission costs and property prices.
Home sales that occurred between April 2015 to June 2022 were affected in the complaint.
The primary issue in this case concerned the NAR’s regulations concerning the Multiple Listing Service (MLS), a popular platform that makes real estate listings and transactions easier. The NAR’s standards have faced criticism for excluding non-traditional real estate models, like discount brokerages and internet real estate platforms, from accessing MLS data. It was claimed that the lack of access would hurt competition and eventually raise prices for customers.
In addition, it was decided that the industry-long practice of sellers having to pay the buyer’s agent commission was anticompetitive. Since the seller usually pays the fees, critics claim that this approach deters buyers’ agents from negotiating lower commissions.
After a two-week trial, the jury returned a verdict. Under US antitrust law, the damages amount is trebled, to a maximum of $5.3 billion.
According to the plaintiffs’ main attorney, Michael Ketchmark, “today was a day of accountability.”
NAR spokesperson Mantill Williams said the NAR will appeal and seek reduced damages.
The US Department of Justice is requesting permission to reopen an antitrust investigation into the NAR’s operations from a federal appeals court in Washington.
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