Zillow & NAR Hit With Same Lawsuit
In this strange new world where cats and dogs live together, Zillow and the National Association of Realtors have found themselves as allies, against REX.
This started out of spite. When co-founder and CEO Jack Ryan, of REX Real Estate Exchange, was ready to buy a home, the agent for the house he wanted left the country. While the agent was vacationing in Italy, Ryan and the owner negotiated and nearly completed the sale on their own. Yet upon his return, the agent still collected his fee. So he started REX.
REX is a disruptor. A low fee real estate company, but with a Mortgage company and title company all rolled into one system that makes buying and selling easy … “to make your experience a convenient one” REX, is a threat to long standing real estate and mortgage tradition – much like Zillow has been perceived in the past 10 years, until Zillow became a mortgage and real estate broker.
Wednesday, REX filed a federal antitrust complaint in Seattle, Washington against Zillow, Trulia and the National Association of Realtors. The complaint refers to Zillow and NAR as part of a Cartel, and was filed on behalf of REX’s clients and American consumers who are concerned about the competition and transparency in real estate, according to a press release.
REX alleges that the NAR and its members have held over consumers for generations, resulting in fees that are two to three times higher than in most developed countries. The company filed the complaint because its clients complained about the second-class treatment that non-cartel homes were receiving.
“Recently, Zillow quietly began obtaining brokerage licenses throughout the country and then joined NAR and local associations. In January, as a part of its cooperation with NAR and MLSs, Zillow began moving homes out of its initial search results for sellers who chose not to use agents adhering to the NAR and local multiple listing service (MLS) practices which hike fees and lower customer service,” according to REX.
“REX is fighting against second-class status for anyone who wants to sell outside the NAR/MLS regime.”
The company states that prior to the recent update to Zillow’s platform, everyone had equal access. The company also believes that Zillow is straying from its disruptive roots by joining the Big Broker ranks.
“Zillow began like so many other platforms: it served a great value to American consumers. Unfortunately, we see Zillow as backtracking on their original mission to serve consumers, instead of focusing on their own profits,” said REX CEO Jack Ryan.
“We launched REX to put the consumer back in charge of real estate and transactions. This case builds on the DOJ’s recent antitrust settlement with NAR/MLSs that beat back some anti-competitive practices. We believe this litigation will define whether technology will serve and protect Big Brokers and the NAR cartel or whether it will make good on its promise of greater ease, service, transparency and lower commission fees for consumers.”
We at Revaluate will continue to follow this fascinating story as it develops.