FOX News contributor Katrina Campins joined The Big Money Show to discuss the U.S. housing market as mortgage rates continue to weigh on potential homebuyers.
The National Association of Realtors and several real estate agents were found guilty by a Missouri jury Tuesday of conspiring to artificially inflate commissions on home sales and were ordered to pay $1.78 billion in damages.
Plaintiffs in the case included the sellers of over 260,000 homes in Missouri, Kansas and Illinois between 2015 and 2022, who objected to the commissions they were required to pay buyers’ agents. The damages awarded by the federal jury in Kansas City can be tripled to more than $5.3 billion under U.S. antitrust law, although the verdict can be appealed.
Home sellers complained that the commission model stifled competition in the real estate industry by keeping buyer agent commissions in the 2.5% to 3% range, even as the role of agents declined as buyers became increasingly able to independently purchase homes online to find.
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A federal jury convicted real estate agents of approximately $1.8 billion in damages for conspiring to artificially inflate commissions on home sales. (Andrew Francis Wallace/Toronto Star via Getty Images / Getty Images)
The plaintiffs’ lead attorney, Michael Ketchmark, said of the ruling that “the day for accountability in real estate has come.”
The defendants denied wrongdoing and the National Association of Realtors (NAR) said there was no evidence that agents were required to “offer compensation at all, let alone amounts that stabilize, fix or increase commissions.”
“This matter is far from final,” NAR President Tracy Kasper said in a statement. “We will appeal the liability finding because we believe the NAR rules serve the best interests of consumers, support market-based pricing, and promote business competition. We remain optimistic that we will ultimately prevail. In the meantime, we will ask the court to reduce the damages awarded by the jury.”
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The National Association of Realtors and other defendants in the case plan to appeal the ruling and will seek to reduce the liability finding in the meantime. (iStock / iStock)
Berkshire-owned HomeServices of America and two of its subsidiaries, as well as Keller Williams, were also defendants in the case. HomeServices said it was disappointed by the ruling and planned to appeal, while a spokesman for Keller Williams said it was reviewing its options and “this is not the end.”
| ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| RMAX | RE/MAX HOLDINGS INC. | 11.33 | +0.57 | +5.35% |
| BRK.B | BERKSHIRE HATHAWAY INC. | 343.71 | +2.47 | +0.72% |
| A HOUSE | ANYWHERE REAL ESTATE INC. | 4.85 | +0.18 | +3.85% |
Re/Max and Anywhere Real Estate – which includes brands such as Century 21, Coldwell Banker and Corcoran – were initially defendants in the case, but settled before trial, with Re/Max getting $55 million and Anywhere getting $83.5 million Paid millions of dollars without admitting liability.
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The U.S. Justice Department is separately asking a federal appeals court in Washington to reopen an antitrust investigation into NAR’s practices.
Portal contributed to this report.