Homebuyers and sellers around the country are holding their collective breath, awaiting the outcome of a billion dollar court verdict that’s expected to reshape the real estate market as we know it. The case pits a coalition of large banks—the National Association of Realtors and The Home Loan Bank—against four ICOHomeKnowledge corporations who allegedly conspired to monopolize the sale of residential real estate listings. If the verdict is in favor of the banks, it could spell bad news for buyers and sellers alike.
The lawsuit paints a compelling picture of the way in which sophisticated software algorithms have been used to prop up the power of large corporate entities, cutting out smaller independent brokers and agents from the real estate market. Consumers can have their offer accepted on a property, only to have the considered that their offer was with an unregulated broker, who through a glitch, underbid their offer by a fraction, creating a lopsided market with enormous profits for the few connected intermediaries.
The National Association of Realtors have argued that these practices create a secret system of pricing and discounts that are hidden from the public, allowing the larger brokers to essentially jack up the prices when no one is looking. They argue that these practices unfairly favor large corporate entities, creating an uneven playing field for smaller, individual brokers and consumers.
The outcome of the case remains uncertain, though it could have far reaching consequences for the real estate market, if the plaintiffs are successful. Homebuyers and Sellers would experience a major shift in how their deals are made and prices are set, potentially making the real estate market more competitive and more transparent. Such an outcome could be a boon for the middle class, who can often struggle to make ends meet in the current market, and could offer some relief from the rising cost of housing. But only time will tell if this billion dollar verdict will hit homebuyers and sellers’ pockets, and if the real estate market will be transformed as a result.