Feds probe Real Estate Agents

[flamin lib]

Original thread--
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1414996

The original poster intimated that the agents/brokers being investigated were price fixing at 6% commissions.

I looked into it (being a Realtor in neighboring Texas) and it appears that the accused were actually boycotting discount brokers. If this is done in collusion with other agents/brokers it is a violation of anti-trust laws. If it is done by a single agent without collusion it is a violation of Texas RE Ethics Code and of the agent's fiduciary responsibilities to the client. In any event it is almost, but not quite the same as price fixing at a specific commission rate.

The Texas Real Estate Commission is attempting to establish a minimum service level to be licensed as a Texas real estate sales agent. The DOJ may intervene citing unfair trade practices. The outcome would be to force licensed Realtors to deal with unlicensed sellers which puts them in a very precarious legal position.

I've got really mixed feelings on this.

[cheezus]

1. woo. 6% for putting a entry in the MLS database

what a freakin scam

[flamin lib]

2. That's the issue.

Some Realtors do exactly that. Texas is trying to insure that a client gets full service for whatever commission is negotiated.

There are "discount" broker who charge a fixed rate, park a property on the MLS and disappear. If the house doesn't sell the client has to pay to re-list it. Most of the do-it-yourself approaches cost the consumer between $1000 & $2000.

In the case of a full service agent that cost is his whether the property sells or not.

The other issue is one of legal liability. An agent cannot give advice or opinion to the seller. To do so opens the agent to suit by his client. To not do so opens the agent to suit from the seller for taking unfair advantage. Although there are people knowledgeable enough in the process to represent themselves they are a tiny % of the FSBO population.