Below is an excerpt from today’s Wall Street Journal Opinion piece co-written by REX Co-Founder/CEO Jack Ryan and SVP Communication & Policy Jonathan Friedland.
It seems almost quaint that 10 years ago the Justice Department had to fight to open up the real estate market so buyers could find homes online without the help of an agent.
Now, sites like Zillow and Homes.com are commonplace, but they couldn’t have thrived without the department’s intervention.
In 2005 the Justice Department sued the National Association of Realtors to force an end to a NAR practice that allowed traditional brokers to withhold listings from new web portals.
The department argued the practice locked in outmoded business models and discouraged price competition. In 2008 the two sides reached a deal that made NAR and its associated organizations treat web-savvy brokers the same as traditional Realtors.
Real-estate search engines took off, giving consumers new power in home buying.
Last November the settlement lapsed, giving the Justice Department an opportunity to open up the residential real estate market to even greater innovation.
While the nation’s roughly 1.3 million residential brokers no longer monopolize the flow of housing information, they’ve shielded themselves with a skein of anti-competitive practices, such as restrictive “all or nothing” membership rules and commission tying practices.
These have kept the high fees they charge unchanged since 1991.
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