I’m sure many of you have heard by now about the numerous lawsuits that are rocking the real estate world. These suits allege that Realtors are “underworked and overpaid”, that the National Association of Realtors and various brokerages collude to fix prices, among other accusations. One verdict has been delivered, and many more copycat suits and appeals are inevitably coming.

Real estate agents have had to defend their livelihood in a way that few others do – certainly not other licensed professionals. People see agents on reality shows and social media touting their huge commission checks, wealth earned by “turning a key”. I don’t need to tell you that these shows are nowhere close to reality. These people are selling something other than houses – entertainment! Don’t mistake it for real life.

We are independent contractors with NO benefits. We’re small business owners who get taxed coming and going and pay all their own expenses (whether the house sells or not!) That commission check is often split a half-dozen different ways before we are paid, and we don’t make anything on a deal that doesn’t close, resulting in countless hours of unpaid work in addition to those lost expenses.

Despite the somewhat sleazy salesman stigma that can come along with my profession, I LOVE what I do. That’s why I’m still here 18 years later. Homeownership is a vital step in the American Dream, in building the foundation for a comfortable livelihood, and I am proud of the role I have in helping people to achieve that dream and to find a place where they feel at home in the world. A good agent provides an invaluable service during what will be most people’s largest investment.

Another main point of the lawsuits is that home sellers feel it is unfair that they pay the commission to both their own and the buyer’s agent. This current setup was implemented in the early 1990’s, when buyer agency was created by statute law. Before that, brokers represented only sellers. If buyers worked with an agent to find a house, then that agent would act as a sub-agent of the listing agent. Their fiduciary duty was then owed to the sellers, leaving buyers unrepresented! Now, buyer agency is under attack, largely due to a misunderstanding in public perception. It exists to protect the consumer!

Did you know that the average homeowner in America has 40X the net worth of the average renter? Forty times! Homeownership is important. And the current market is already very tough for buyers, between inventory and interest rates. Buyers deserve fair representation, which is why changes were made more than 30 years ago.

There is also discussion of collusion between different brokerages (which would be a violation of the Sherman Anti-Trust Act of 1890), aided by collaboration on Multiple Listing Services (MLS). The elimination of this sort of mutual listing service would result in every brokerage having their own private listings, reducing competition. As usual, minorities will be hit disproportionally hard as buying a house becomes more about “who you know”. We are taking big steps backwards with these lawsuits and the consumer will suffer.

The trial for the first lawsuit, Sitzer/Burnett v. NAR, was surprisingly brief, with the jury deliberating for just 2-3 hours. The arguments included many half-truths, twisting of statements made years prior, and emotional ploys. Just one example: in his closing argument, Michael Ketchmark, the lead attorney for the plaintiffs, asked, in what other industry do people pay for the other side’s services? Why, your own, Mr. Ketchmark! An appeal is inevitable, and I hope facts hold more sway over emotions this time around.

Forgive me for the length – I have a lot to say on this topic! Scroll down to the Market Update section of the newsletter for a series of news articles regarding the lawsuits. I am happy to discuss this with any who are interested.

Despite all this industry news, I have much to be thankful for this year. As I progress further into my 40’s, each new little ache reminds me to be thankful for my overall health. I’m thankful that my kids are thriving, and that Mike is the most amazing, supportive spouse I could ask for. I am thankful for a vibrant, supportive community. I am thankful for my rockstar team, my second family, who work hard through every problem thrown at them (and put up with my craziness on the daily!) We’re tightening our budget, just like everyone else, but I am thankful that we’ve made it through a rough year and will still be here to help the next time you move.

I am thankful for every one of you who has supported my business over the years, and that I have been able to assist you through important life changes. I hope that you continue to see value in what I bring as your real estate broker, and that you will consider my words when confronted with sensationalist headlines and myths perpetuated by reality TV.

Wishing you all a wonderful Thanksgiving!