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Friday, May 11, 2007

Law - FTC and Justice issue joint report on “Competition in the Real Estate Brokerage Industry" [Updated]

Recalling the ILB's series of entries in the late spring of 2006 (including this one from July 26, 2006), occasioned by the 2006 General Assembly's action in passing an anti- discount real estate brokers ("minimum services") law:

The Federal Trade Commission and U.S. Department of Justice (DOJ) today issued a joint report, “Competition in the Real Estate Brokerage Industry.” The purpose of the report is to inform consumers and others involved in the industry about important competition issues involving residential real estate, including the impact of the Internet, the competitive structure of the real estate brokerage industry, and obstacles to a more competitive environment. * * *

As discussed in the report, the review by the FTC and the DOJ suggests that, although the real estate industry has undergone a number of substantial changes in recent years – particularly as a result of technological advances such as the Internet – competition in the industry has been hindered as a result of actions taken by some real estate brokers acting through multiple listing services and the National Association of Realtors, state legislatures, and state real estate commissions. In addition, consumers likely would benefit significantly from additional knowledge about the range of options available in brokerage services and fees.

Read the entire press release here.

Access the 78-page report here.

[Updated] This afternoon I came across this Findlaw.com article, published May 9th: "Must Zillow, the Online Home Price Estimator, Be Licensed as a Real Estate Appraiser in Arizona? Why The State Bill Making Clear that the Answer is No Should Become Law," by Anita Ramasastry, an Associate Professor of Law at the University of Washington School of Law in Seattle and a Director of the Shidler Center for Law, Commerce & Technology. The article begins:

In July and November 2006, the Arizona Board of Appraisal issued two cease-and-desist letters to the company that operates the popular real estate website Zillow, saying that Zillow needs an appraiser license to offer its "Zestimates" in Arizona. This matter recently was turned over to the Arizona Attorney General's Office. In the worst-case scenario, the state could file criminal charges against the company for defying its cease-and-desist order.

Currently, the Arizona Senate is considering a bill - already approved by the House - that would make it clear that the outputs of Zillow's automated valuation models (AVM) are not, in fact, real estate appraisals, and as such are not subject to regulation in Arizona.

Posted by Marcia Oddi on May 11, 2007 11:54 AM
Posted to General Law Related