Wednesday, November 15, 2006

NAR Seeks Cooperation with Federal Trade Commission

The NATIONAL ASSOCIATION OF REALTORS® has reached out to the Federal Trade Commission in an attempt to address the commission’s concerns about how exclusive agency listings are handled by multiple listing services.

Under an exclusive-agency agreement, if sellers find a buyer on their own, they do not have to pay a full commission to their real estate practitioner. Some MLSs don't allow this type of listing to appear in their home-search databases.

“We understand that the FTC is now looking at the possibility of taking NAR up on its offer to address this issue,” says NAR General Counsel Laurie Janik. NAR’s goal, Janik says, is to work in concert with the FTC to create an industrywide solution that will address the agency’s concerns that certain MLS activities hurt competition.

In a press conference Thursday, the FTC announced that it has investigated seven independently operated MLSs and consider their practices to be anticompetitive. As a result, five MLSs have signed consent orders to discontinue certain practices, and the other two MLSs will be litigated in court.

“Although we do not agree with today’s FTC actions, we are happy to learn that the FTC — which does not customarily reach out to industry — is looking to work with NAR on this issue,” says NAR President Thomas M. Stevens. “The result will be, we hope, the elimination of duplicative actions such as the consent orders.”

Stevens also stressed that REALTORS® welcome competition and work in a competitive environment every day.

MLSs are cooperatives formed by real estate brokers in which they offer each other the opportunity to sell their listings. The industry has made a multimillion dollar investment to create the infrastructure of the MLS systems. Most MLSs also display their members’ listings on Internet advertising sites, such as REALTOR.com, which displays 3.9 million homes for sale and has 7 million unique visitors each month.

“MLSs are a powerful force for competition,” says Janik. “They make it easy for sellers to reach buyers and for buyers to find the right property.”

— REALTOR® Magazine Online

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