In previous posts (Next time you buy or refinance a house), we have offered advice on how to better negotiate for mortgage loans. Now the Antitrust Division of the Justice Department has launched a new website that tells you how anticompetitive your local real estate laws are.
On the selling side, twelve states currently ban rebates and/or inducements to sellers. From a survey of agents,
“If we give rebates and inducements, it would get out of control and all clients would be wanting something. The present law keeps it under control.”
- Alabama
- Alaska
- Kansas
- Louisiana
- Mississippi
- Missouri
| - Montana
- New Jersey
- North Dakota
- Oklahoma
- Oregon
- Tennessee
|
And eight states are trying to eliminate discount brokers
- Alabama
- Idaho
- Illinois
- Indiana
| |
On the commercial real estate brokerage side of the business, rebates are not unusual - even in states which prohibit them (such as Tennessee). The way in which this law is circumvented is many corporations directly employ someone who is a licensed real estate broker, but will still engage a 3rd party brokerage firm to execute the transaction. Then, when a commission is paid, the company will require the 3rd party firm to share this fee with them. This practice sometimes even enables the company's corporate real estate department to generate a profit.
ReplyDelete