Realtors sued over policies

The Feds must not have been impressed by Realtor promises not to restrict Internet home sales listings.

The Department of Justice is suing the Washington, D.C.-based National Association of Realtors for what it says are anti-competitive moves.

This week, the National Association of Realtors, which represents more than 1 million agents, said it would enact new rules requiring its members not to restrict use of their Internet home listings.

Some traditional agents want the Realtors' association to allow them to block their listings from being marketed by Internet-based real estate sales firms, which have been growing over the last few years.

Others didn't like the idea of agents up the street putting listings on competing Web sites.

The association gave the Realtor-owned multiple listing services around the country until next July to change any restrictive policies.

But the Department of Justice – which sued the Realtors on Thursday – said the industry moves don't go far enough to protect consumers from anti-competitive moves.

The Realtors' new policy still allows brokers to discriminate against competitors who post listings online, said J. Bruce McDonald, deputy assistant attorney general in the Justice Department's antitrust division.

"The purchase of a home is one of the most significant financial decisions a family can make, and NAR's policy stifles competition," Mr. McDonald said. "Consumers benefit when real estate brokers are free to compete vigorously by offering innovative services."

Officials with the Realtors' association said the government's action is unwarranted.

"After months of negotiations, we are at a loss to understand why the Department of Justice would bring a legal action," the trade organization said in a statement. "Many of the changes incorporated in the new policy are in direct response to concerns they have raised over the course of the two-year investigation."

A spokesperson for ForSale ByOwner.com, one of the largest Internet home sales companies, on Friday called the federal suit "a major setback for the powerful real estate lobby."

Justice Department officials maintain that since the Internet can be used to deliver brokerage services more efficiently and cheaply, "brokers who utilize the Internet represent a competitive challenge to traditional brokers."

The government has aggressively pursued actions it considers anti-competitive against agents in several states.

The Associated Press contributed to this report.