- The Washington Times - Thursday, July 13, 2006

A Texas real-estate group has agreed to allow discount brokers unrestricted rights to put property listings on the Internet after the first of several federal investigations into unfair business practices nationwide, the Federal Trade Commission said yesterday.

The FTC said the Austin Board of Realtors withheld listing information from publicly accessible Internet sites unless competitors contracted with home sellers in a way approved by the board.

Advertising restrictions similar to the ones in the rule adopted by the Austin group in February 2005 can be found in other cities, some of which are being investigated on accusations that they illegally restrain competition, the FTC said.

The restrictions can prevent discount brokers from offering prices lower than traditional brokers, FTC officials said.

Real-estate industry officials said the same issue would not arise in the Washington area, where no rules limit the types of listings that can be advertised.

“We don’t restrict which types of listing can be shown on broker or public Web sites,” said Jonathan Hill, vice president of business strategies for Metropolitan Regional Information System, a Rockville multiple listing service for real-estate properties in the Mid-Atlantic. “We just don’t have the distinction here. A listing is a listing.”

The settlement agreement requires the Austin Board of Realtors not to interfere with the kinds of listings chosen by brokers. The Board of Realtors also agreed to eliminate any rules that might give one kind of real-estate listing an advantage over others.

The FTC cracked down on real-estate advertising restrictions in the mid-1990s during the Internet’s early development, but only now is addressing Web site listings specifically.

“The growth of the Internet was not around in that time period,” said Patrick Roach, deputy assistant director of the FTC’s bureau of competition.

FTC officials said they plan further enforcement actions against real-estate-agent associations that restrict Internet advertisements, but would not say which ones.

“I can’t comment on how close we are to resolution on our pending investigations,” said Jeffrey Schmidt, director of the FTC’s bureau of competition.

The agency is collecting data on how much money the restrictions cost consumers.

In Austin, the number of homes advertised on the Internet fell from 18 percent to 2.5 percent after the Austin Board of Realtors enacted its rule limiting the ads, the FTC said.

“We haven’t tried to quantify [losses to Austin consumers], but we know it’s significant,” Mr. Schmidt said.

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