The brokerage is expected to pay $55 million in compensation and implement modifications to its business procedures in exchange for the settlement.
Another defendant in the two class-action lawsuits aimed at reducing real estate compensation fees has reached a deal with plaintiffs. RE/MAX is one of the large brokerages mentioned in the lawsuits, referred to by the Sitzer/Burnett and Moehrl cases, and has agreed to settle for $55 million in order to settle all claims against it. The announcement comes about two months after another defendant, Anywhere Real Estate, previously called Realogy Holdings Corp., agreed to pay $83.5 million.
The National Association of REALTORS(r), as well as the plaintiffs in the suit, announced it intends to continue to argue for pro-consumer and pro-competitive regional MLS marketplaces for brokers that allow the listing broker and customers to decide on the amount of money offered to the buyer’s agent when it comes to MLS listings.
RE/MAX has denied all allegations against it. However, they have informed news outlets that it has agreed to settle to end the uncertainty surrounding the ongoing litigation. In the approved settlement plan, which requires court approval, RE/MAX declares that it will make modifications to its business policies. Anywhere The parent company that owns Coldwell Banker, Century21, Sotheby’s International Realty, and Corcoran was also in agreement to make some modifications to its business practices.
For more resources and information on how local broker marketplaces support home buyers and sellers everywhere, check out the Competition. Realtor for infographics, articles, and more.
NAR said in a statement that it is not dissuaded from its argument: “Settlement is always an option for any party in litigation. The recent settlements do not change how the case is presented to the court or NAR’s commitment to defend ourselves. We are confident we will prevail in proving the lawfulness of the rules under attack. Pro-competitive, pro-consumer local MLS broker marketplaces ensure equity, efficiency, transparency and market-driven pricing options for home buyers and sellers. The practice of the listing broker paying the buyer broker’s compensation saves sellers time and money by having so many buyer brokers participating in that local marketplace and thus creates a larger pool of buyers for sellers. For buyers, these marketplaces save them the burden of extra costs at closing, enable them to receive professional representation and make homeownership possible for more people.”
The lawsuits argue that NAR rules are in violation of antitrust laws and that they increase the amount of money paid to buyers’ agents by requiring a listing agent to pay the buyer’s agent for listing an item through the MLS. NAR claims that the lawsuits falsely portray the rules of the association as anticompetitive. The directions instruct listing brokers to establish in collaboration with their clients what compensation is provided to a buyer’s agent when they advertise the MLS listings. Furthermore, NAR says buyer’s agents have the right to discuss compensation arrangements with listing brokers, which differs from the amount listed within the MLS. Both NAR as well as the MLS have any influence regarding the amount of broker commissions.
NAR recommends its members make use of Buyer representation agreements that are easy to understand and in writing. It is crucial that REALTORS(r) keep educating consumers on the fact that commissions are set by brokers and their customers and reminding consumers of methods REALTORS(r) can assist in navigating the legal, financial, and community aspects of purchasing and selling a house.
“In fact it is true that the U.S. model of independent local broker markets is generally regarded as the most value-for-money and efficient in the world without additional or hidden costs, and offering more accurate verifiable information than other nations. We are looking forward to arguing our case in the courts,” NAR’s statement read.