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The Honolulu Advertiser
Posted on: Friday, October 13, 2006

Realtors open up online listings

By Christopher S. Rugaber
Associated Press

WASHINGTON — Realtors in five states agreed to allow discount brokers full access to their online multiple listing services as part of a landmark settlement with federal regulators announced yesterday.

The Federal Trade Commission said the enforcement actions are intended to send a signal to real-estate brokerages nationwide that discount or "non-traditional" brokers should be allowed equal access to the combined online listings of homes for sale in local markets.

"The rules these brokers made drove up costs and reduced choice for consumers, and they violated federal law," said FTC Competition Director Jeffrey Schmidt.

The FTC said it reached consent agreements with five multiple listing services in Colorado, New Hampshire, New Jersey, Virginia and Wisconsin. But two real estate groups in Michigan would not settle and the FTC will pursue claims against them before an administrative law judge in Washington.

At issue is whether homes for sale listed by discount online firms show up on Web sites operated by local multiple listing services, whose members typically are full-service firms that charge commissions of 6 percent or higher. In six of the seven enforcement actions, the listing services allowed discounters to list homes online in databases viewable by brokers, but refused to allow the listings to be published on Web sites available to the public.

In the seventh case, a brokers' group blocked rival discounter home listings from inclusion on the listing service itself. The practices must be discontinued under the consent decrees or a listing service could face civil penalties of $11,000 per violation.

The Honolulu Board of Realtors, which operates the multiple listing service on O'ahu, said it allows discount brokers to list property in databases viewable by brokers and the public.

There are 900 multiple listing services in the United States, said Mary Trupo, a spokeswoman for the National Association of Realtors, an industry trade group that operates the realtor.com Web site. The group estimates that 77 percent of home buyers start their search on the Internet and then contract a real-estate agent.

"Although we do not agree with today's FTC actions, we are happy to learn that the FTC, which does not customarily reach out to industry, is looking to work with NAR on this issue," said Thomas M. Stevens, president of the Realtors' association.

The FTC's Schmidt said more cases are in the works. "There are clearly additional ... multiple listing services where we think some of these rules continue to be a problem and we're continuing to look at those," he said at a news conference.

Investors seemed to take the news in stride. Shares of Realogy Corp., which franchises Century 21, ERA, Coldwell Banker and Sotheby's International, rose $1.04 or 4.5 percent to $24.38 on the New York Stock Exchange yesterday.