The U.S. Department of Justice is expressing concern about recent changes to the way people buy and sell houses in America.
On Sunday, the DOJ filed a statement about a settlement reached between the National Association of Realtors and home sellers who filed class-action lawsuits against the trade group. Though that agreement was reached in March and its provisions took effect in August, a judge is set to grant final approval Tuesday.
The statement is the latest development in a yearslong back and forth between the Justice Department and the real estate trade group. Though the DOJ did not offer an explicit position on the settlement, it warned specifically about a rule requiring agents to have a written and signed buyer agreement before they can take buyers on a home tour, either in person or virtually.
The DOJ said that step isn't enough to clear the NAR from possible antitrust investigations, and it even suggested that making buyers sign an agreement could be detrimental.
“The new provision that requires buyers and brokers to make written agreements before home tours may harm buyers and limit how brokers compete for clients,” the filing said.
Commissions have always been negotiable, but before August, listing agents could use offers of compensation to provide an incentive for buyer agents to bring clients to see their properties. That resulted in sellers typically paying fees to both their agent and the buyer’s agent — for example, splitting a 5% or 6% commission.
In addition, the new rules include barring listing agents from advertising compensation for a buyer’s broker on the multiple listing service, the online platform where agents share properties for sale.
The DOJ also issued a request to the judge overseeing the approval to take the step of informing the NAR that the settlement doesn’t shield the organization from antitrust litigation.
The settlement doesn’t “preclude any future enforcement actions by the United States,” according to the filing, “and compliance with the proposed settlement or new NAR rules implementing that settlement affords no defense to any such enforcement actions.”