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FOR IMMEDIATE RELEASE CONTACT: Chris Christensen
703-536-7776
Homeowners Praise Administration Efforts to Preserve
Competition in Real Estate Services
The American Homeowners Grassroots Alliance (AHGA) today praised
President Bush and his leaders in the Department of Justice and the
Federal Trade Commission for their efforts to preserve competition in
real estate services. The most recent action was a joint April 20, 2005
letter from the Department of Justice and the Federal Trade Commission
urging the Texas Real Estate Commission to reject a proposed regulation
that would change current rules by imposing new restrictions on the
ability of Texas real estate professionals to offer flexibility in
brokerage services.
Deborah Platt Majoras, Chairman of the Federal Trade Commission and R.
Hewitt Pate, Assistant Attorney General in charge of the Department of
Justice's Antitrust Division noted that "Limited-service brokers are
growing rapidly in Texas and across the country because they provide
greater choice and can save consumers thousands of dollars on a single
home sale….The proposed regulation would restrict the beneficial
competition created by these limited-service brokers, and the Texas Real
Estate Commission should reject it."
The American Homeowners Grassroots Alliance believes this most recent
action is a victory for consumers. Coupled with recent interventions in
Oklahoma, where a similar bill was withdrawn from consideration at the
Justice Department’s request, and a lawsuit brought by the Justice
Department against similar existing practices in Kentucky, the federal
government has made it clear that state level efforts to limit
competition in real estate services are clearly illegal.
In September of 2004 AHGA made a number of similar recommendations to
the Antitrust Modernization Commission relating to existing real estate
practices. Congress created the Commission in 2002 to examine whether
the need exists to modernize the antitrust laws, to identify and study
related issues and evaluate the advisability of proposals, and to
prepare and submit recommendations to Congress and the President. The
Alliance suggested the Commission study whether current industry
electronic commerce practices served the best interests of home buyers
and sellers. New legislation may be needed to assure that home listings
are widely disseminated in manner that is user friendly to potential
buyers and to assure that organizations representing real estate brokers
and agents who have fiduciary responsibilities to buyers and sellers
reflect those responsibilities in their collective actions.
AHGA also asked the Antitrust Commission to study causes of the erosion
of the laws of real estate agency. In recent years, representatives of
real estate organizations have set out at the state level to create laws
legalizing “dual agency”, that would allow a broker to simultaneously
represent both home buyers and sellers. Among the fiduciary
responsibilities of a real estate broker and agent is to help negotiate
for the best price and terms for their clients. When the broker/agent
simultaneously represents a buyer and a seller of the same property
getting the best price and terms for both clients is mutually exclusive.
AHGA urged the commission to examine this issue and to recommend a
federal law pre-empting state “dual agency” laws should it conclude that
consumers are being denied full benefit of real estate broker and agent
fiduciary responsibilities. The Alliance also noted that tie-in
arrangements between real estate trade associations and multiple listing
service (MLS) organizations appear to undermine real estate agency and
that a “bright line” prohibition of this practice would be timely.
AHGA is a national bipartisan advocacy organization representing the
nation’s 75 million homeowners. The Alliance believes that policies that
encourage and protect home ownership are in our national best interest.
Those policies encourage and sustain the maintenance of a strong and
broad middle class, build a sense of community and responsibility, and
facilitate investment in homes, which are the largest, most universal
savings/equity-building vehicle for most Americans. AHGA’s positions and
more information about the organization are available at
www.AmericanHomeowners.org.
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