Class Action Suit Could Change Real Estate Commissions
The National Association of Realtors (NAR) as well as four of the biggest realty companies are facing an antitrust lawsuit claiming conspiracy to systematically overcharge home sellers by requiring they pay the agents who represent the buyers of their homes. The class-action lawsuit was filed in Chicago’s federal district court and bases its allegations on NAR’s own rules. Specifically, NAR does not allow buyers to negotiate their agents’ split to a lower rate once a home seller agrees in listing to a specific split of the commission.
The lawsuit claims this rule burdens the home seller with costs that, in a competitive market, the buyer would bear. Of note, no mandatory compensation rule exists in overseas markets. In fact, total commission costs tend to be lower when compared to those in the United States. Many American buyers are not aware of their real estate agent’s commission split, while sellers do because they agree to it in the listing contract.
In addition to NAR, the class-action lawsuit names as co-defendants HomeServices of America, Inc., RE/MAX Holdings, Inc., Keller Williams Realty Inc., and Realogy Holdings Corp. NAR is the largest real estate trade group in the industry, touting 1.3 million members. The co-defendants named in the lawsuit each have hundreds of thousands of agents in the U.S. and Canada. If the case is certified as a class action, sellers who have paid a broker commission within the past four years relating to a home listed on the MLS in several metropolitan areas across the country, including Tampa, Orlando, Sarasota, and Ft. Myers, could join.
Why Using a Real Estate Attorney is Important
Whether you have sold a home in the past four years and are affected by this potential class-action lawsuit or are just interested in buying or selling a home, it is critical to hire an experienced real estate attorney to guide you through the process. This is particularly true in Florida, where the housing market is expensive – particularly Central Florida. A transaction involving the purchase or sale of a home is likely one of the most significant and largest one a person will experience. What makes these types of transactions unique is that the purchase or sale of a property involves real property law; unique issues may arise as well as problems unique to the transaction that, if not corrected properly, can cause even bigger issues down the line.
After a buyer and seller formally agree to a transaction, a formal written contract is drawn up. Most realtors use standard forms – generally approved by NAR – that do not take into account particular situations that may arise. In short, a real estate attorney can ensure your rights are being protected under the contract and that you have remedies available to you should the other side breach. Other issues a real estate attorney can address include the accuracy of the property’s legal description, irregularities in title, whether or not title is free and clear of encumbrances and marketable, explanation of any easements, covenants, or other limitations to the property, as well as explaining title insurance’s coverage and any exceptions.
”The class-action lawsuit was filed in Chicago’s federal district court and bases its allegations on NAR’s own rules.
Florida Residential Real Estate Attorneys
The Central Florida real estate attorneys at Bogin, Munns & Munns can help you with the purchase or sale of property in Orlando and ensure your rights are protected. Schedule your consultation today to learn how we can help you with the purchase or sale of property.
NOTICE: The article above is not intended to serve as legal advice, and you should not rely on it as such. It is offered only as general information. You should consult with a duly licensed attorney regarding your Florida legal matter, as every situation is unique. Please know that merely reading this article, subscribing to this blog, or otherwise contacting Bogin, Munns & Munns does not establish an attorney-client relationship with our firm. Should you seek legal representation from Bogin, Munns & Munns, any such representation must first be agreed to by the firm and confirmed in a written agreement.