REX Corrects Record on National Association of Realtors Continued Anticompetitive Antics and Attempt to Evade DOJ Investigation
Real estate trade group puts cartel economics ahead of accountability to Federal officials and consumers
Austin, Texas – REX, the technology company resetting traditional real estate on behalf of consumers, issued the following response to the National Association of Realtors (NAR) efforts to quash a U.S. Department of Justice (DOJ) civil investigative demandinto NAR’s continued anticompetitive policies and antitrust violations.
“Today’s filing by NAR underscores their business model – cartel economics, $100 million in lobbying, tens of billions in excessive fees, and countless anti-consumer rules that restrict housing accessibility. The federal government is finally standing up to hold the real estate cartel accountable for overcharging home sellers and buyers thousands to tens of thousands of dollars on every transaction and steering consumers to line their own pockets,” said REX’s General Counsel Michael Toth.
NAR’s unwillingness to comply with DOJ’s request for information comes amidst growing pressure against the trade association’s unfair, autocratic practices throughout the real estate industry. REX has ongoing litigation with NAR over similar antitrust violations which have harmed the industry.
Earlier this month, a federal judge denied NAR’s effort to dismiss one such lawsuit. Three federal judges have now concluded that claims against NAR’s anticompetitive behavior will be heard. NAR’s filing on Monday seeks to avoid more accountability to federal officials. A copy of the DOJ civil investigative demand that NAR is refusing to answer can be viewed here.
In February, REX asked the Biden Administration to reopen its investigation into NAR. In response, the Biden Administration later nixed the proposed settlement with NAR and renewed its probe into the NAR-sponsored, price-fixing policies that make real estate broker costs two to three times more expensive in the United States than around the world.
For the past five years, while REX has been fighting to reform the real estate industry. As a change agent for consumers, REX highlighted to federal antitrust authorities the damage that NAR’s policies have caused to housing affordability and accessibility.
“In its legal filing against DOJ, NAR falsely claims it was working to implement the proposed settlement. In reality, it was standing in the way of homebuyers. In the immediate aftermath of the settlement, REX worked to replace the unlawful rules preventing consumers from seeing homes with new ones promoting consumer choice and forcing NAR to tell consumers the true price of their services, NAR’s lawyers intervened to shut down the conversation. Homebuyers are still locked out of homes because of NAR and often do not know what they are paying. This is why the DOJ investigation must proceed,” said REX co-founder and COO Lynley Sides.
After the DOJ proposed a settlement with NAR in November 2020, REX kept fighting for industry reforms that would benefit consumers nationwide who are forced to pay excessive brokerage fees at a time when direct-to-consumer technology has brought fees to zero across the service sector. In February, REX submitted to the DOJ a detailed comment letter on the proposed settlement. REX highlighted in the comment letter that the practices that DOJ had condemned inflicted a heavy financial burden on cash-strapped, aspiring homebuyers. REX urged federal authorities to take further action to protect consumers from NAR’santicompetitive behaviors which transfer $60-80 billion per year from American consumers to traditional real estate brokers as home prices have been skyrocketing.
In addition to working closely with federal and state antitrust authorities, REX is standing up for homebuyers today by pursuing two major federal cases against practices that make it even more difficult to afford a home. Supported by consumer advocacy organizations, REX is challenging rules across the country that make it illegal for companies to give money back to homebuyers in the form of rebates. Additionally, REX is taking on Zillow for enforcing the NAR’s segregation rule, which hides low-commission homes from consumers to protect the high-fee homes sold by legacy brokers. Both cases are pending in federal court.
After NAR and Zillow tried to dismiss the case, on September 2, 2021, U.S. District Court Judge Thomas Zilly gave consumers and REX and consumers a major victory in the antitrust and consumer protection lawsuit against NAR’s segregation rule. The Court held REX sufficiently alleged that NAR and Zillow conspired to restrain trade and harm consumers.