Election Aftermath: What’s Next for Real Estate and Consumer Protection?

Unlock the secrets behind the ongoing tug-of-war between the Department of Justice and the National Association of Realtors that could redefine the real estate landscape. Discover why some real estate agents are buzzing with the idea that Donald Trump might swoop in to change the game while we bust those myths and reveal why change is inevitable, no matter who holds office.

This episode promises to equip you with the knowledge and insights you need to navigate the future of real estate, as we shed light on the long history of antitrust issues between these two powerhouses and what the pending settlements mean for buyers and sellers alike.

Learn about the history of the DOJ vs NAR by Rob Hahn
Learn about the movement to defund the CFPB

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Transcript

Speaker 1: 0:00

Believe it or not, but you can probably believe it. I have come across a handful of real estate agents on social media claiming that Donald Trump is going to swoop in and save them from the NAR settlement. Welcome to the Real Estate Replay. I'm Wendy Gilch, an industry outsider, here to reveal the hidden practices and explain the processes that can impact your next home purchase or sale. Alongside other industry misfits, we'll call out these poor practices and equip homebuyers and sellers with insights they need to protect themselves every step of the way. Welcome back to the Real Estate Replay, where we dive into stories and issues that impact homebuyers and sellers across the country. I'm your host, wendy Gilch, and today we have a shorter special episode dedicated to the recent elections, what they could mean for real estate and a quick refresher on the ongoing bad blood between the Department of Justice and the National Association of Realtors. Can you tell that? I just attended the Eros tour concert? Probably With the Sitzer sentiment still fresh in our minds. Let's explore what could be coming next for the industry. With the Sitzer settlement still fresh in our minds, let's explore what could be coming next for the industry and what it means for consumers like you. So first let's talk about the NAR settlement from the Sitzer lawsuit and what I've been seeing online since the elections. Believe it or not, you could probably believe it. I've come across a handful of real estate agents on social media claiming that Donald Trump is going to swoop in and save them from the NARS settlement. Newsflash folks. That's just not going to happen. First of all, the settlement is already nearing the finish line and final approval of the settlement deal is expected by the end of November. Trump does not take office until sometime in January, so this thing is all but just locked in. And here's the kicker those who have objected to the settlement have pretty much been ignored and we're told that anyone the judge does want to speak to who does object would have to make their way in person at their own expenses. So it doesn't really matter who's in the Oval Office in January, because this settlement has been in the works for years and is going to be wrapped up by the end of this month. It's basically a direct response to long-standing issues around anti-competitive practices, and no election is about to change what's already about to be a done deal, and even if somebody wanted to change a private settlement, that'll already be a done deal. By the time someone new comes into the office, what would they actually even say hey, I know a jury found you guilty and that a bunch of your contracts were really anti-consumer and needed an overhaul. And yeah, your fees are finally being addressed in a way that makes sense for clients. But no worries, let's go back to the old days where we can just pretend that buyer agents were free. I mean, really that kind of stuff just isn't going to fly anymore. Consumers are aware now of kind of what's been happening and we're starting to learn better ways of processes, what to look out for in contracts and really pay attention.

Speaker 1: 2:59

So what about the Department of Justice? First, let's remind ourselves the history between the Department of Justice. First, let's remind ourselves the history between the Department of Justice and the National Association of Realtors. This isn't the first time these two have clashed and in fact, their bad blood goes on way beyond when I was even born. In case you're wondering, I'm 42.

Speaker 1: 3:16

The DOJ, and even the FTC at some points, has long argued that NAR's policies around data and commissions limit competition, and in fact, 20 years ago, the DOJ even filed an antitrust lawsuit against NAR, challenging their MLS policies that limited online brokerages access. That eventually led to a 2008 settlement where NAR had to change some policies to allow greater MLS access for online brokers. Included in that 2008 settlement was pretty much a leave me alone, in which the DOJ could not investigate or bother NAR for a period of time, but when that time period was up, they went at it again. In 2018, the Department of Justice filed a complaint against NAR, focusing again on commissions, mls rules and contracts. During the Trump administration in 2020, they landed on a settlement with the National Association of Realtors that aimed to address some of these anti-competitive practices. However, the Biden administration came in and by July 2021, the DOJ abruptly withdrew from this settlement, citing concerns that it didn't go far enough to protect consumers or ensure that a truly competitive marketplace was going to exist. The DOJ argued that they needed more flexibility to investigate and address broader, systematic issues with NARS policies and practices. So that was in 2021, and they are still arguing about that settlement today and within that time period from 2021 until now, the DOJ has continued its investigations, focusing specifically on the practices around commission structures, buyer-agent fees and how these impact consumers.

Speaker 1: 5:01

The DOJ's renewed scrutiny has intensified discussions in the industry, especially with the recent Sitzer lawsuit and the NAR settlement, which further challenges the traditional commission-sharing model. These shifts signal that the DOJ, along with private litigation, is pushing towards a more transparent and consumer-friendly model in real estate. We know that the Department of Justice has been taking meetings with people all throughout the industry for the past year or so and we know they've been able to request certain files, emails and documents from NAR this past year, but no one knows what they are actually planning to do, and if anyone tells you they do, they're full of it. But because we all like to gossip and give our theories, I'm going to give you mine. Knowing what type of administration is coming in, I would guess the DOJ does something before January to keep progress moving, and whatever they do will likely just be drawn out, just like the current ongoing battle from at least four years ago, and the Great War will continue Another Taylor Swift reference.

Speaker 1: 6:06

In closing, I want to end with a little confession. The person I voted for didn't win, but don't worry, I'm not panicking. I'm not packing my bags and I'm not moving out of the country or anything else you might have seen in a bunch of online videos from people who also voted like I did. I'll be staying right here, but I'm going to be doubling down on our mission.

Speaker 1: 6:27

This election outcome just makes me even more determined to ramp up our programs, education and content to protect consumers, and here's why it's no secret that the Republican side of politics often leads towards business freedoms, while the Democrats tend to favor more consumer protections. And when I say business freedoms, I'm talking about more than just deregulations. Republicans have repeatedly pushed to defund or even eliminate the Consumer Financial Protection Bureau, known as the CFPB. The CFPB is one of the only agencies that's actually built to look out strictly for consumers in the financial world. While we could go on for another hour about the interesting connections between Republicans, the defund movement and payday loan companies, we'll have to save that for another time.

Speaker 1: 7:16

So as we move forward, let's be real about what's at stake. We might not have as much regulatory backup in the future, but that just means we have to push harder for transparency, fairness and consumer rights in real estate. Elections can come and go, but our mission stays steady. Thanks for tuning in and remember that voting is just one way to make change. How we act, what we demand and how we advocate for ourselves and each other. That's the real power. See you next week. Have a story or a question you want to share? Hit us up at therealestatereplaycom.