multiple listing service

Apache is functioning normally

Apache is functioning normally

After nearly 10 days of trial proceedings, Zillow is ready for its years-long legal battle with REX Real Estate to be over. On Wednesday, just nine days after the long-awaited trial’s September 18 start date, the real estate behemoth file a motion for judgment as a matter of law in the U.S. District Court in Seattle hearing the trial.

A judgement as a matter of the law is permissible if there is no legally sufficient basis for a reasonable jury to find for the nonmoving party (in this instance, REX) on that issue.

Originally filed by REX in March 2021, against Zillow and the National Association of Realtors, the lawsuit alleges that changes made to Zillow’s website “unfairly hides certain listings, shrinking their exposure and diminishing competition among real estate brokers.”

Two months prior, in January 2021, Zillow began moving homes out of its initial search results for sellers who chose not to use agents adhering to the NAR and local multiple listing service (MLS) practices, creating a two-tab design for agent listings and “other listings.”

In January 2022, NAR filed a countersuit claiming that REX uses false advertising and misleading claims to deceive consumers in violation of the Lanham Act, but the countersuit was dismissed in late April 2022.

In mid-May 2022, REX ceased its brokerage operations. 

A little over a year later, in mid-June 2023, the three parties involved in the suit, all filed motions for summary judgment on at least some issues, if not the entire lawsuit.

While Judge Thomas Zilly dismissed REX’s antitrust claims against NAR and Zillow, he allowed the discount brokerage’s false advertising claim under the Lanham Act, and a claim for unfair or deceptive trade practices under Washington’s Consumer Protection Act (WCPA) to stand.

According to Zillow’s latest motion, since the start of the trial, REX has failed to produce sufficient evidence on either claim.

“The evidence REX promised would come at trial has not materialized, and the evidence introduced at trial falls short of what is required for multiple elements of these claims,” the motion reads. “Accordingly, REX’s claims should not be put to a jury, and the Court should enter judgment in Zillow’s favor as a matter of law under Federal Rule of Civil Procedure 50(a).”

In order to prove their Lanham Act claim, REX must identify particular statements made by Zillow and then show that they are false. According to earlier filings, REX highlighted Zillow’s tab labels separating types of listings as the statements it was challenging.

While Zillow acknowledged that the court determined that the tab labels are literally false, as REX employs agents who are realtor association members, “it has never has addressed whether the default status or two-tab display as a whole are false statements of fact,” which would be necessary to prove the Lanham Act claim.

“The non-communicative aspects of Zillow’s display—that merely divide listings and default one tab over the other—do not make any such claim,” the motion reads. “Indeed, design decisions that ‘limit [users’] access’ to materials are distinct from any ‘false statement.’”

In addition, for the Lanham Act to apply, the speech in question must be commercial speech, something Zillow claims the two-tab display is not.

“There is no evidence that Zillow intended to convey any particularized message with the default status or two-tab display or that the consumers who viewed these features took away any particular message,” the filing states. “Zillow is an ‘online database of information’ that provides ‘free, publicly available’ information that is ‘not transactional.’”

The motion also claims that “REX has not developed evidence that any aspect of Zillow’s two-tab display was meant to influence consumers to buy defendant’s goods or services,” and that there is “no evidence that a substantial part of Zillow’s audience was deceived by the default status or two-tab display.”

Finally, Zillow also states that that REX “has not even attempted to show injury flowing directly from the alleged deception caused by the distinct aspects of the two-tab display,” something that is necessary if REX hopes to be awarded damages.

“REX’s own fact witnesses did not offer any testimony supporting the notion that the labels, in particular, caused them harm,” the motion continues. “Moreover, the fact that there was an impact on for-sale-by-owner listings—listings that properly would be labeled as ‘Other listings’—shows it is not the labels that had this impact.”

Regarding the WCPA claim, Zillow states that all of the same reasons from the Lanham Act claim apply.

Zillow did not wish to comment and REX has not returned a request for comment.

Source: housingwire.com

Apache is functioning normally

Despite her initial misgivings, Boston U.S. District Court judge Patti Saris granted preliminary approval of MLS Property Information Network’s (MLS PIN) settlement agreement in the class action buyer-broker commission antitrust lawsuit.

In court documents filed last Thursday, Saris approved the agreement, stating that the releases in the agreement were “fair, reasonable, and adequate to the Settlement Class.”

Originally filed in December 2020, the Nosalek lawsuit, named after its lead plaintiff, alleges that the broker-owned MLS PIN is not directly required to abide by the National Association of Realtors (NAR) rules. However, it has nonetheless adopted a rule similar to an NAR rule requiring listing brokers to offer a blanket, unilateral offer of compensation to buyer brokers in order to submit a listing to MLS PIN.

Other defendants in the lawsuit include Anywhere, RE/MAX, Keller Williams and HomeServices of America. Unlike the two other buyer-broker commission lawsuits, Moehrl and Sitzer/Burnett, NAR is not a defendant in the Nosalek lawsuit. Additionally, while Anywhere has filed settlement agreements in the Moehrl and Sitzer/Burnett suits, it has not tried to settle the Nosalek suit.

MLS PIN, which is New England’s largest multiple listing service (MLS), filed the settlement agreement in late June. In the agreement, MLS PIN denied any wrongdoing, but stated that it agreed to the settlement in order “to avoid the further risk, expense, inconvenience, and distraction of burdensome and protracted litigation, and thereby to resolve this controversy, to avoid the risks inherent in complex litigation, and to obtain complete dismissal of the Action as to MLS PIN.”

The MLS also agreed to pay $3 million in the settlement, with up to $900,000 going towards attorney’s fees, up to $200,000 going towards expenses, $250,000 going towards notifying settlement class members, and each of the three named lead plaintiffs will get up to $2,500 for being class representatives.

According to the settlement agreement, the plaintiffs will use the remaining funds of at least $1.6425 million to pay for further expenses for the litigation against the remaining defendants “for the benefit of Settlement Class Members.”

In early August, Saris expressed skepticism over the financial portion of the proposed agreement.

“I’ve never seen a settlement agreement like this in my 30 years,” Saris said at an August hearing.

With the payment structure outlined in the agreement class members in the case will not be getting any money from the settlement agreement, however the plaintiffs’ class-action attorneys, “get fully funded for expenses to date, and they basically get a litigation fund open-ended for the future for as long as it takes, which may be another three to five years,” Saris said. A final approval hearing for the settlement agreement is expected before the end of the year.

In an emailed statement, a spokesperson for MLS PIN said the firm was “pleased with the Judge’s decision to move the settlement forward,” but would not comment further.

Attorneys for the plaintiffs did not return a request for comment.

Source: housingwire.com

Apache is functioning normally

Anywhere Real Estate’s decision to settle two cases challenging the sales commission structure for residential agents could disrupt how home transactions are currently managed.

However, while this settlement is unilateral, it does not cover any of the other defendants in the two cases involved (Moehrl and Sitzer/Burnett), particularly the National Association of Realtors.

That could make it difficult to determine broader impacts, including on mortgage qualification and underwriting, of a potential shift in compensation source and amount regarding buyer real estate brokers.

Under current multiple listing service rules, the listing broker must offer compensation to the buyer’s representative as part of getting the property onto the system. Some have argued that making the buyer responsible for the fee would negatively affect what they are able to purchase. 

Published reports give Anywhere’s settlement an $83.5 million value, but specifics are not yet available.

“The path to obtain final approval and implement the settlement is a long one, and Anywhere has taken the first important step toward a resolution that not only releases the company but also our affiliated agents and franchisees,” a company spokesperson said in a statement. “We believe the settlement will remove future uncertainty with respect to the upcoming trial, potential additional claims, and legal expense, enabling Anywhere to focus on and continue delivering what’s next for agents and franchisees.”

It could not comment any further given the ongoing legal matter and confidentiality agreements, the spokesperson said.

Indications are that Anywhere would make significant changes to how it handles compensation in transactions, but the lack of details makes it difficult for an assessment of the effects of those changes, a report from Thomas McJoynt-Griffith, Ryan Tomasello and Bose George of Keefe, Bruyette & Woods stated.

“We believe a shift toward optional cooperative compensation is a likely consideration as part of the settlement, at a minimum,” the KBW analysts said. “We note that this would technically put Anywhere’s practices at odds with NAR rules, but it is also unclear whether making cooperative compensation optional will actually change industry commissions in practice.”

During the Trump Administration, a settlement with NAR was reached but the U.S. Justice Department reneged on the deal following the election of Pres. Biden.

While settlement is always an option in cases like this, NAR’s commitment to defend itself remains unchanged and its compensation rule will survive the legal challenge, a statement from Mantill Williams, its vice president of communications said.

“The practice of the listing broker paying the buyer broker’s compensation saves sellers time and money by having so many buyer brokers participating in that local marketplace and thus creates a larger pool of buyers for sellers,” Williams said. “For buyers, these marketplaces save them the burden of extra costs at closing, enable them to receive professional representation and make homeownership possible for more people.”

In fact, Anywhere has argued that mandatory participation in the compensation scheme by seller brokers is not required to have “a well-functioning” home sales market, added BTIG analyst Soham Bhonsie.

Some MLS systems already allow for the selling broker to offer as little as $0 in commission to the buyer counterpart.

“Over time, sellers could decide to pay less to a buy-side agent which could lead to some comp compression (and potentially fewer showings), but the pace at which that could occur will be dictated by what brokers will allow to be charged at a local level as well,” Bhonsie said. “We think most brokers will continue to mandate a minimum compensation level for their agents to do business, which could in turn delay the impact to the buy-side agent.”

Taken to the next logical step, fewer showings are likely to translate into a lower number of sales, which in turn could potentially drive down mortgage origination volume.

The settlement of a third case was also unilateral, although it involved an MLS. At the time of the agreement in Nosalek v. MLS Property Information Network, one broker questioned whether NAR could survive the changes because of the amount of money at stake.

Source: nationalmortgagenews.com

Apache is functioning normally

With mortgage rates near 20-year highs and relatively few homes listed for sale, the Atlanta-area housing market in August reached something of a precarious — and possibly temporary — plateau with prices rising, but slowly.

The median price of a home sold last month was $404,000, according to data released this week by the Georgia Multiple Listing Service.

That was just 1% higher than in July and only 2.3% above the median price of a home sold a year earlier, compared to double-digit increases for previous years, said John Ryan, chief marketing officer of the Georgia MLS.

The dampener on price hikes has been mortgage rates, pushed higher by the Federal Reserve’s campaign to tame inflation by raising borrowing costs.

When that changes, the market will see a flood of buying, predicted broker Kristen Jones, owner of Re/Max Around Atlanta. “Eventually, the Fed will stop, and mortgage rates will come down. At that point, we expect the floodgates to open.”

But right now, those gates are high and they’re holding.

The average rate for a 30-year mortgage was 7.18% at the end of August, the highest it has been since March 2002, according to the Federal Home Loan Mortgage Corp., which insures loans in secondary markets.

Many who do buy now are betting that can’t continue, Jones said. “Buyers crossing their fingers that they can refinance in the next few years.”

Higher rates not only make monthly payments dramatically higher for new buyers, they freeze many potential sellers who don’t want to trade their current low rates for a high rate if they move, Jones said. “Sellers are not motivated to list. About 61% of all outstanding mortgages have an interest rate below 4%.”

With so many potential sellers standing pat, inventory — that is, the number of homes listed for sale — was 12.1% lower in August than it was a year earlier, according to the Georgia MLS.

Fewer than 11,000 homes in the region were listed for sale, which represents barely two months of sales. In a healthy, balanced market, the inventory level should represent at least six months of sales.

Part of the problem is an overall housing shortage in metro Atlanta.

After years of exuberant overbuilding, construction came to a virtual halt during the 2007-09 recession and has never regained its previous pace despite the region’s population growth. Since 2012, the shortage — and the flow of millennials into the market — has kept home prices rising, which increasingly made affordability an issue.

Then came the pandemic, which roiled expectations about commuting and home offices, and spurred federal efforts to protect household finances by driving interest rates down to historic lows and pumping money into the economy.

The rebound from the pandemic has meant rapid job growth, along with higher pay for many.

But at least until recently, Atlanta home price gains far outpaced income growth. That made down-payments for homes a challenge, shoving many potential buyers out of the market.

Demand for housing has spurred construction, most of it well outside the city of Atlanta. Even so, high land prices and various zoning restrictions have made construction for first-time buyers rare.

In Alpharetta, Blue River Lifestyle Communities this week announced a 24-unit development that includes both townhomes and single-family houses. The homes will be listed at $1.3 million or more.

Nearly 80% of baby boomers own a home, but only about half of the nation’s millennials do, according to national brokerage Redfin. About 1 of every 5 millennials say they don’t think they’ll ever be able to afford one, according to a Redfin poll.

But at least renters have also seen a moderation in the market. Metro Atlanta’s median rent is $2,127 a month, according to Rent.com, which tracks rentals nationally. That is virtually unchanged from a year ago, the group said.

And rate hikes are also biting homeowners who stay put.

The Fed’s campaign ripples through to virtually all borrowing, from car loans to credit cards. So even homeowners with low-rate mortgages will pay more than before if they want to tap their mortgage for a loan, said Andy Walden, vice president of research at Black Knight, a real estate analysis firm recently purchased by Atlanta-based Intercontinental Exchange.

Nationally, mortgage holders withdrew $39 billion in equity from their homes in the second quarter of this year, which is only about half as much as before interest rates started to climb, he said. “Rising rates are having a clear impact on how — and how much — equity mortgage holders are willing to withdraw from their homes.”

Metro Atlanta housing market, August

Median sales price: $404,000

Number of sales: 5,299

Number of homes listed for sale: 10,927

Price compared to year earlier: up 2.3%

Sales compared to year earlier: down 15.8%

Price compared to January 2020: up 50%

Average rate, 30-year, fixed-rate mortgage

Aug. 31, 2023: 7.18%

Aug. 31, 2022: 5.66%

Aug. 31, 2021: 2.87%

Aug. 31, 2020: 2.91%

High since 1999: 8.64% (May 2000)

Last time above 7%: March 29, 2002

Source: Georgia Multiple Listing Service, S&P Case Shiller Index, Federal Home Loan Mortgage Corp.

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Source: ajc.com

Apache is functioning normally

After looking at listings online, a prospective homebuyer typically reaches out to a real estate agent who then gives them a list of recommended lenders and LOs. But three multibillion-dollar class action antitrust lawsuits looming over the real estate industry may soon reshape how buyers interact with agents.

Some of the nation’s largest real estate brokerages, including Keller Williams, RE/MAX, HomeServices of America as well as the National Association of Realtors, are facing three class action lawsuits (NAR is only named as a defendant in two lawsuits) that could result in the industry paying out tens of billions in damages. Anywhere Real Estate just settled two of the cases for a total of $83.5 million, which suggests major changes could be on the horizon. 

The three class action suits Moehrl, Sitzer/Burnett, and Nosalek, named after their lead plaintiffs, take aim at NAR’s Participation Rule, which requires listing agents to make a blanket offer of compensation to buyers’ agents in order to list the property on a Realtor-affiliated multiple listing service (MLS). According to the plaintiffs, commission sharing inflates the costs for consumers, in violation of the Sherman Antitrust Act. NAR, however, contends that the current commission structure, which has been in place for over 100 years, actually benefits consumers.

“The buyers want the listing brokers to pay their buyer representative so they can have the most money invested in their down payment and get the best loan terms and rates possible,” Katie Johnson, NAR’s chief legal officer, said. “Sellers want their listing broker to pay the buyer broker’s compensation because it will result in the most buyers being able to afford their house.”

At a time when affordability is constraining first-time buyers from entering the market and interest rates are still expected to climb, “it’s going to do nothing but hurt the potential buyer,” argued Michael Borodinsky, a vice president and branch manager at Caliber Home Loans.

“You’ve got current economic conditions that are not opportunistic for a homebuyer right now, inflation is still out there and it’s all constraining buyers’ ability to spend. So, if you take that, you add that to where mortgage rates are, which are currently at 20 year highs, you add that to the fact that as of today, there is a still a very, very big problem with housing inventory, which has put prices artificially higher than they probably should be in terms of valuation, the buyers are just going to be saddled with more pain”

It will be months or years until the final verdict in the three lawsuits comes out, but there will be clear winners and losers from the outcome, loan officers and housing industry experts said in interviews with HousingWire. If the traditional practice of sellers paying for both sides of the agents ends, housing agencies will have to weigh in to determine ways for buyers to finance their agents’ comp, LOs noted. 

Reshaping the home selling and buying process

Although Johnson anticipates a lengthy appeals process with all of these lawsuits, round one of the fight is quickly approaching. Sitzer/Burnett is scheduled to head to trial in mid-October and Moehrl is expected to head to court in the first half of 2024 with Nosalek most likely following shortly thereafter.

When the day comes that a final verdict is reached, Steve Murray, the co-founder of RealTrends Consulting sees three possible outcomes.  

“Worst case scenario, the broker representing the buyer will have to negotiate their own fee with their client and the seller can no longer be compelled to make a blanket offer of compensation in order to list on the MLS,” Murray said.

“The second thing that could happen, is that more and more buyers will go directly to the listing agent, in which case they are clearly unrepresented. The third thing that would happen is a whole new kind of buyer brokers arise that charge an hourly flat fee to represent buyers,” according to Murray.

In light of Anywhere’s recent settlement, Murray believes the other defendants may also consider settling the suits. 

But Ken Trepeta, the president of RESPRO, is holding off on making any predictions. It might depend on the terms spelled out in the settlement agreement, which still aren’t public yet, he said. 

“If they are settling this and it goes away and they don’t admit wrongdoing and there is no requirement to change policies,” he said. Potential damages in the Sitzer/Burnett suit are anticipated to be up to $4 billion, while damages in the Moehrl suit could reach up to $40 billion.

(An attorney for the plaintiffs in the Moehrl case said Anywhere will be making significant changes to its policies, but did not offer specifics.)

For its part, NAR says it is not giving up the fight.

“Settlement is always an option for any party in litigation. NAR’s commitment to defend ourselves in court remains unchanged and we are confident we will prevail in proving the lawfulness of the rules under attack. Pro-competitive, pro-consumer local MLS broker marketplaces ensure equity, efficiency, transparency and market-driven pricing options for home buyers and sellers,” Mantill Williams, NAR’s vice president of communications, wrote in an email to HousingWire.

If buyer brokers and agents are no longer involved in most real estate transactions, as Murray suggests is a possibility, LOs and lenders who rely on agent referrals for transactions could have a smaller target group to focus on.  

“There will likely be fewer Realtors, the sales volume will be handled by fewer Realtors. But if you’re an originator, that simply means that your target group is now smaller,” said Brian Hale, CEO of Mortgage Advisory Partners. “If you’re not dealing with the top producing agents or teams in the industry, you may find that your client has gone away.”

Loan officers may increasingly place more importance on reaching consumers directly especially when a buyer takes initiative in the homebuying process rather than relying on agents. 

“If there isn’t a buyer’s agent involved – who’s just going to oversee step-by-step – I think consumers are going to take a little bit of that control back because they’re not willing to pay an agent for that level of hand holding and walking them through. So, they’ll reach out and they’ll find the companies that are publicly known as consumer-direct lenders,” said Mike Roberts, the co-founder of City Creek Mortgage. 

TV, billboard and radio ads are traditional ways to reach consumers directly in hopes that borrowers will think of the lender when it’s time to buy a home, Roberts explained. 

As industry players have begun preparing for a variety of potential outcomes in these lawsuits, some agents say they have seen lenders work to develop their consumer-facing marketing.

“I have seen some of the top loan officers go much more direct to the consumers,” said Gretchen Pearson, the broker-owner of Berkshire Hathaway HomeServices Drysdale Properties. “One of the top loan officers in the nation has set up webinars that he does four times a week and he is building up his own pipeline.”

Finding a way for buyers to finance their agents’ commissions is one of the critical issues that loan officers raise should the traditional practice of sellers paying for both agents’ commissions goes away.

The government-sponsored enterprises (GSEs) including Fannie Mae and Freddie Mac as well as the Federal Housing Administration (FHA) would likely have to weigh in, loan officers said. 

“I think that’s the most important thing so that these buyers don’t get impacted negatively by their inability to have sufficient funds for a down payment,” Borodinsky said. “Because otherwise it’s going to sort of end the whole concept of  how we define closing costs, because now we’ve got to add that in as almost as another tax or a fee.”

If Fannie Mae and Freddie Mac were to count the buyer’s agent fee as a seller contribution, listing agents would have more power in the homebuying and selling process, Roberts noted.

“I think listing agents are going to win. Agents who know how to get listings are going to win because buyers are gonna go straight to the listing agent and ask the listing agent to write a contract to present to the seller,” Roberts said.

Fannie Mae, Freddie Mac and the U.S. Department of Housing and Urban Development didn’t respond to HousingWire’s questions about whether they would come up with a mechanism to help buyers finance agent commissions. 

“There is a potential of buyers having to directly pay buyer brokers and that could impact the lending side, and I know they are aware, but I am not aware of them taking any action,” Johnson said. “And maybe that is intentional because there might not be an immediate need for action.”

HousingWire reached out to the top 10 mortgage originators to comment on the impact commission lawsuit results could have on the mortgage industry. Wells Fargo, Pennymac, U.S. Bank Home Mortgage and Planet Home Lending declined to comment. Others didn’t respond.

Plenty of buyers still want a personal advisor

Although buyer’s agency commission may disappear or greatly slowdown, Murray believes the relationship between real estate agents and LOs will remain integral to the transaction.

“If buyer brokers agency goes away, I am not sure that the habit of referrals will go away or change too much,” Murray said. “Buyers will still rely on an agent, whether it is a listing agent or their own buyer broker to get a recommendation on mortgage companies.” 

A significant number of consumers want a trusted advisor, Patrick Lamb, CEO of On Q Financial, said.

“They want somebody who knows the market, they want somebody who is advocating for them, and who is going to coordinate and go, drive around town and look at all these houses and do all the legwork. There’s some value in that,” Lamb explained.

A conclusion to these three lawsuits is not expected to come for several years. Industry experts believe there will be multiple appeals, giving real estate brokerages and lenders time to consider their options.

“I think it’s a tangential benefit. Whatever ruling likely comes out of this, you can’t change the world in 24 hours. It’ll take time for this to evolve through, there will likely be challenges, there could be appeals. You don’t know how all this goes,” Hale said. 

What is certain is that many current LOs would have to reconsider how they get referrals and leads if the environment changes, he explained. And not all would fare well.

“[Only] a minority of LOs are very savvy and very smart about how they pursue referrals. If many of the current LOs in our industry don’t change the way they’re searching for referrals and/or leads in this kind of an environment, they have a high likelihood of becoming extinct.” 

Source: housingwire.com

Apache is functioning normally

Anywhere Real Estate’s settlement agreement in two class action antitrust lawsuits dealing with buyer broker compensation raises important questions about the future of buyer’s agency and how other defendants are viewing the fast approaching trials.

Top of mind, of course, is what exactly the settlement agreements include, besides an agreement by Anywhere to pay a total of $83.5 million in damages for both the Moehrl and Sitzer/Burnett suits.

Steve Berman, the managing partner and co-founder of Hagens Berman Sobol Shapiro LLP, which represents the plaintiffs in the Moehrl suit, said the “settlement includes significant changes to Anywhere’s practices relating to the conduct that we have challenged.” However, the exact terms of the settlement won’t be known until the plaintiffs file a motion to approve the settlement agreement. Anywhere declined to comment on the exact terms of the agreement.

Meanwhile, Steve Murray, the co-founder of RealTrends Consulting, said he believes the changes Anywhere proposed to make could mark the end of buyer broker compensation as we know it.

“As far as cooperation and compensation, that is now pretty much over,” Murray said. “The biggest combined brokerage company in the country in terms of all their brands, just said, ‘We’re out. We are not going to defend this case anymore,’ so that will definitely lead to changes.”

Murray sees three possible outcomes for the lawsuits.

“Worst case scenario, the broker representing the buyer will have to negotiate their own fee with their client and the seller can no longer be compelled to make a blanket offer of compensation in order to list on the MLS,” Murray said. “The second thing that could happen is that more and more buyers will go directly to the listing agent, in which case they are clearly unrepresented. The third thing that would happen is a whole new kind of buyer brokers arise that charge an hourly flat fee to represent buyers,” according to Murray.

In preparation for these outcomes, Berkshire Hathaway HomeServices Drysdale Properties broker-owner Gretchen Pearson said she has been working with her agents to implement buyer’s agency agreements.

“If an agent files a buyer’s agency agreement for me, the broker, to review, the work flows just aren’t there in our document management system,” Pearson said. “The software we use isn’t built that way.” Therefore, it won’t just impact agents, but technology systems, she added.

While the lawsuits’ potential impact on buyer’s agency and buyer broker compensation is the largest question looming, Murray also wonders how the settlement agreement will impact Anywhere’s many franchise owners.

“Will the plaintiffs now just go and start suing individual Coldwell Banker franchises?” he posited.

When asked how the agreement would impact its affiliates, Anywhere highlighted a line from their initial statement.

 “Anywhere has taken the first important step toward a resolution that not only releases the company but also our affiliated agents and franchisees,” the company said.

Murray said he believes this could be the start of more settlements to come from the other defendants in the suit.

“They are all going to be running for settlements now,” Murray said. “I think this is a floodgate moment for sure.”

Ken Trepeta, the president of RESPRO, is holding off on making any predictions, suggesting it might depend on the terms spelled out in the settlement agreement.

“If they are settling this and it goes away and they don’t admit wrongdoing and there is no requirement to change policies,” he said. Damages in the Sitzer/Burnett suit are anticipated to be up to $4 billion, while damages in the Moehrl suit are expected to reach up to $40 billion.

The National Association of Realtors, a defendant in both lawsuits, says it is not giving up the fight.

“Settlement is always an option for any party in litigation. NAR’s commitment to defend ourselves in court remains unchanged and we are confident we will prevail in proving the lawfulness of the rules under attack. Pro-competitive, pro-consumer local MLS broker marketplaces ensure equity, efficiency, transparency and market-driven pricing options for home buyers and sellers,” Mantill Williams, NAR’s vice president of communications, wrote in an email to HousingWire.

The practice of the listing broker paying the buyer broker’s compensation saves sellers time and money by having many buyer brokers participating in that local marketplace, NAR noted. 

For buyers, the NAR argues these marketplaces save them the burden of extra costs at closing, allowing them to get professional representation and make homeownership possible for more people. 

Keller Williams, RE/MAX, and HomeServices of America, the lawsuits’ three other defendants, declined to comment.

The Sitzer/Burnett lawsuit is scheduled to head to trial on October 16, 2023, while a trial date for the Moehrl lawsuit has yet to be set, but it is expected to take place in early 2024.

Originally filed in 2019, the Moehrl and Sitzer/Burnett lawsuits take aim at NAR’s Participation Rule, which requires listing agents to make a blanket offer of compensation to buyers’ agents in order to list the property on a realtor-affiliated multiple listing service (MLS). According to the plaintiffs, commission sharing inflates the costs for consumers, in violation of the Sherman Antitrust Act. NAR contends that the current commission structure, which has been in place for over 100 years, actually helps consumers.

Source: housingwire.com

Apache is functioning normally

Real estate giant Anywhere has reached a settlement agreement in two of the major class action antitrust lawsuits facing the housing industry.

According to court documents filed on Tuesday, Anywhere Real Estate and the home sellers suing the firm in both the Moehrl and Sitzer/Burnett cases, which both deal with buyer brokers’ commissions, have reached a preliminary settlement agreement, settling all claims in both suits. Before the agreements are finalized they must be approved by the U.S. District Court judges in Illinois (Moehrl) and Missouri (Sitzer/Burnett), who are overseeing the two lawsuits.

No details about either agreement were disclosed in the filings, but attorneys for the plaintiffs in the Moehrl lawsuit told HousingWire the agreement for both lawsuits was a total of $83.5 million, as the two plaintiff classes negotiated the settlement together.

“The monetary settlement was the most that could be obtained in light of Anywhere’s available financial resources. Critically, the settlement includes significant changes to Anywhere’s practices relating to the conduct that we have challenged,” Steve Berman, the managing partner and co-founder of Hagens Berman Sobol Shapirio LLP, wrote in an email. “Our antitrust team looks forward to continuing to pursue additional relief against remaining defendants for those who have been systematically overcharged for simply selling their homes in an already unstable housing market.”

Anywhere asked the court the firm be excused from the pretrial conference on the Sitzer/Burnett suit, scheduled for this coming Friday. The Sitzer/Burnett suit is slated to head to trial on October 16, 2023.

A trial date has yet to be set for the Moehrl lawsuit.

“We are pleased that Anywhere has reached a nationwide settlement with the plaintiffs in the Burnett and Moerhl lawsuits,” an Anywhere spokesperson wrote in an email. “The path to obtain final approval and implement the settlement is a long one, and Anywhere has taken the first important step toward a resolution that not only releases the company but also our affiliated agents and franchisees. We believe the settlement will remove future uncertainty with respect to the upcoming trial, potential additional claims, and legal expense, enabling Anywhere to focus on and continue delivering what’s next for agents and franchisees. Given ongoing legal proceedings and confidentiality agreements between parties, we cannot comment further at this time.”   

Anywhere is just one of the many defendants in these lawsuits, which also include Keller Williams, RE/MAX, HomeServices of America and the National Association of Realtors.

The two lawsuits take aim at NAR’s Participation Rule, which requires listing agents to make a blanket offer of compensation to buyers’ agents in order to list the property on a realtor-affiliated multiple listing service (MLS). According to the plaintiffs, commission sharing inflates the costs for consumers, in violation of the Sherman Antitrust Act. NAR contends that the current commission structure, which has been in place for over 100 years, actually helps consumers.

Damages in the Sitzer/Burnett suit are anticipated to be up to $4 billion, while damages in the Moehrl suit are expected to reach up to $40 billion.

The other defendants in the suits have yet to file settlement agreements.

Attorneys for the plaintiffs in the Moehrl suit did not return a request for comment.

Source: housingwire.com

Apache is functioning normally

Affordable starter homes for first-time buyers are in great demand this year, leading to shrinking inventories and a competitive market. That means that buyers’ options are limited. This leads to increased competition for those homes that are available, spurring bidding wars and pricing out entry-level buyers.

A recent analysis by Zillow found that there were 8.6 percent fewer homes on the market in January 2016 than a year ago. Sellers have more negotiating power in competitive cities, mostly in the West, where job markets are hot, and demand for housing is heavy.

Buyers competing in a tight market must be prepared. They should get pre-approved for a mortgage and know their maximum price before house shopping so they can make a competitive offer. They should also take another look at their must-have list and decide where they’re willing to compromise, if necessary.

Here are five surefire signs that you are facing a competitive market for buyers.

1. Short time on market.

The fastest and easiest way to tell if sales are hot in your local market is to measure how quickly properties in your price range are selling. You can get a sense of the demand by simply tracking listings on real estate web sites.

A more accurate method is to review “median days on market” data from your local multiple listing service. You may not be able to access this data yourself, but your real estate agent should be able to get it for you. Look at the monthly and the year to year trends for the Zip codes where you are looking. If houses are selling in three months, that is clearly a seller’s market; in two months or less, you are probably looking at a hot, competitive market.

Another measure of demand is called “months’ supply.” It represents the number of months for the current inventory available for sale at the current rate of demand. A months’ supply of six months is considered balanced; the smaller the months’ supply, the hotter the market.

2. Jumps in sales.

An easy way to take your market’s temperature is to compare the current monthly sales rate to one or two years previous. Sales vary seasonally, but not over 5 percent when compared to the same month a year earlier.

If you see sales jump 10 percent or more, your market is taking off, and inventories may not be keeping up with demand, which is going to make it competitive for buyers. Follow local data on Zip codes or neighborhoods available on real estate listing sites, or ask your agent for information on sales trends.

3. List-to-price ratio.

When homes start selling at prices higher than their listing prices, it is a sure bet you are in a competitive market. If the list-to-price ratio is above 100%, the home sold for more than the list price. If it is less than 100%, the home sold for less than the list price.

MLSs make this statistic available to their members on a monthly basis, so you can get the data from your agent. Some also release it publicly. Some real estate web sites report local list-to-price ratios.

4. Deadlines on offers.

When sellers start placing deadlines for offers on their listings, obviously they are expecting more than one bid and they see no reason to extend the selling period. When you see a listing with deadlines, prepare for battle if you want the house.

5. Cash offers.

Cash offers, as opposed to offers financed by mortgages, are very attractive to sellers because they do not have to take the chance that a buyer’s financing will fall through or that an appraisal will come in low, and the seller might be asked to lower the price to save the deal.

In lower tier price ranges, many cash offers come from investors who are planning to flip the house or convert it into a rental. An increase in cash offers are a sign that competition is stiff.  MLSs compile data on cash sales in local communities and Zip codes and you can get the information from your agent.

Soaring sales, prices above list, days on the market below two months, months’ supply below four months, cut-off dates—these are signs that buyers will likely face multi-bid situations. Be ready to move fast with the best offer you can make and be patient if the right deal takes months to appear. Even so, never bid on a house you do not like—you might end up living in it for many years to come.

Source: totalmortgage.com

Apache is functioning normally

Just days after awarding Zillow and National Association of Realtors (NAR) a major victory in their legal battle against REX Real Estate, the court made it clear that Zillow’s fight is far from over.

A federal court judge concluded on Friday that in regard to REX’s false advertising claims against Zillow, the firm has proven “falsity.” The ruling came after REX filed a motion for summary judgement on the matter.

In his order, Judge Thomas Zilly of the U.S. District Court for the Western District of Washington wrote that “for the purposes of REX’s Lanham Act Claim, the court concludes that ‘falsity’ has been established as a matter of law.”

The Lanham Act states that anyone who uses false or misleading facts or misrepresents the nature of goods or services, “shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.”

In REX’s Lanham Act portion of its lawsuit, the firm alleges that Zillow “falsely labeled REX listings as ‘Other Listings’ rather than ‘Agent Listings’ when REX’s listings were in fact offered by licensed real estate agents,” according to earlier court documents.

“It is literally false not to characterize REX’s listings as ‘Agent Listings.’ Placing REX listings in the ‘Other listings’ category when juxtaposed with “Agent Listings” as the only other option is also literally false by necessary implication. Zillow’s display is not only false, it is also misleading.”

Originally filed by REX in March 2021, the suit alleges that changes made to Zillow’s website “unfairly hides certain listings, shrinking their exposure and diminishing competition among real estate brokers.”

Two months prior, in January 2021, Zillow began moving homes out of its initial search results for sellers who chose not to use agents adhering to the NAR and local multiple listing service (MLS) practices.

REX ceased its brokerage operations in mid-May of 2022.

According to earlier court filings from Zillow, the listing giant changed its website after making the decision to swap to the “gold standard source of listings data,” the Internet Data Exchange (IDX) feed that the multiple listing services use. Zillow said that it joined the MLSs to guarantee access to the IDX feeds.

However, according to REX, in January 2021, in some states, including Washington, the firm employed licensed brokers and agents, which should have qualified REX’s listings as “agent listings.”

“Nevertheless, REX’s for sale listings were relegated, along with FSBO and non-MLS listings, to the “Other listings” page because REX’s brokers and agents were not members of the MLSs from which Zillow was receiving IDX feeds,” the filing reads.

When Zillow launched its two-tab design, the company also created an “FAQ” page clarifying the differences between the tabs. REX pointed out that the FAQ page “did not indicate that the ‘Other listings’ tab might include homes for sale by agents or brokers who were not MLS members,” and that it “failed to define MLS or to clarify that some licensed real estate agents and brokers do not belong to an MLS.”

In his ruling, Zilly wrote: “When the labels are viewed side-by-side, the unambiguous assertion is that one tab includes homes listed for sale by agents and the second tab contains all other listings, i.e., homes for sale by their owners or by non-agents. When used in contrast to ‘agent listings,’ the phrase ‘other listings’ can only be understood as indicating those listings ‘remaining or not included’ in or ‘distinct’ or ‘different’ from agent listings, or in other words, non-agent listings.”

In an emailed statement, attorneys at Boise Schiller representing REX, said: “We believe the judge’s ruling on the Lanham Act will help us move the case and is in the best interest of the consumer.”

This ruling came just days after Zilly dismissed all antitrust allegations made by REX against NAR and Zillow.

“Last week’s antitrust ruling showed that REX’s primary claim was without merit. This victory was a big step towards us prevailing in this case given their main argument has been tossed. We look forward to presenting our case in court on these remaining claims,” Will Lemke, Zillow’s manager of corporate communications, wrote in an email. “We believe customers understand the two-tab system and are confident that the evidence will show that REX’s business failed for reasons unrelated to Zillow.”

The suit is scheduled to head to trial on Sept. 18.

This story was updated to include commentary from Zillow.

Source: housingwire.com

Apache is functioning normally

Though the National Association of Realtors is not out of the legal woods yet, the trade group does have reason to celebrate. A federal court judge on Wednesday dismissed all antitrust allegations made by REX Real Estate against NAR and Zillow.

The remaining claims in the case are all against Zillow, meaning that NAR is no longer a defendant in the case and will not have to participate if it heads to trial next month as scheduled.

In his order dismissing the claims, Judge Thomas Zilly of the U.S. District Court for the Western District of Washington wrote that the “Court concludes that REX has failed to present evidence of the conspiracy alleged in its Amended Complaint, namely, a purported agreement between NAR, Zillow, and non-party MLSs to segregate, conceal, and demote non-MLS listings on Zillow’s websites and mobile platforms.”

The antitrust claims against NAR and Zillow were dismissed with prejudice.

In the order, Zilly noted that NAR’s No-Commingling Rule was optional and that about 29% of Realtor-affiliated MLSs had not adopted the rule, without any repercussions from NAR. On its own, the rule “does not constitute direct or circumstantial evidence of an anticompetitive agreement between NAR and Zillow,” Zilly wrote.

“The undisputed evidence in this action shows that neither NAR nor its affiliated MLSs were involved in Zillow’s decision to implement the challenged two-tab display that allegedly drove REX out of business,” he added.

Zilly also pointed out the unlike other brokerage, Zillow continued to display REX’s listings.

“The evidence demonstrates that instead of precluding REX’s listings entirely, like websites such as Redfin did … Zillow expended significant time and resources to ensure that REX’s and other non-MLS listings would remain on its platforms, albeit under a separate tab,” the order reads.

Originally filed by REX in March 2021, the lawsuit alleges that changes made to Zillow’s website “unfairly hides certain listings, shrinking their exposure and diminishing competition among real estate brokers.”

Two months prior, in January 2021, Zillow began moving homes out of its initial search results for sellers who chose not to use agents adhering to the NAR and local multiple listing service (MLS) practices.

In January 2022, NAR filed a countersuit claiming that REX uses false advertising and misleading claims to deceive consumers in violation of the Lanham Act, but the countersuit was dismissed in late April 2022.

In mid-May 2022, REX ceased its brokerage operations. 

A little over a year later, in mid-June 2023, the three parties involved in the suit, all filed motions for summary judgment on at least some issues, if not the entire lawsuit.

Earlier this month, Zilly ruled on other claims in the lawsuit, allowing three of REX’s claims against Zillow to head to trial: a false advertising claim under the Lanham Act, a claim for unfair or deceptive trade practices under Washington’s Consumer Protection Act (CPA) and a claim alleging defamation.

Although Zillow’s legal battle against REX is not over, the company was pleased with Wednesday’s ruling.

“Today’s ruling is a significant victory for Zillow in this case. The court agreed REX’s antitrust claim was without merit and lacked any evidence to back it up,” Will Lemke, Zillow’s manager of corporate communications, wrote in an email. “This ruling affirms Zillow’s business decisions were squarely focused on improving the data on our website for consumers. With REX’s central argument tossed from this case, we believe the public now sees this case for what it is: REX seized upon another company’s website design change to hide its own business failings.”

The lawsuit is scheduled to head to trial on September 18. NAR and attorney for REX did not return a request for comment by the time of publication.

Source: housingwire.com