A proposed Kansas rule barring real estate brokers from offering gift cards would reduce competition and cause “significant harm” to homebuyers, the US Department of Justice’s Antitrust Division told state regulators.
The federal government doesn’t often weigh in on Kansas real estate regulations and its letter, written by Acting Assistant Attorney General Andrew Finch, comes as the Kansas Real Estate Commission considers public comments. The letter, dated Friday, was addressed to Erik Wisner, the commission’s executive director.
A public hearing held Monday on the planned regulation lasted less than an hour. Commissioners heard “various tones of opposition” from speakers, Wisner said. They plan to take up the matter again at their August 21 meeting.
Wisner said it was the first time since he was hired in February 2015 that the Justice Department has weighed in on a Kansas real estate regulation.
Kansas law prohibits real estate brokers from offering “rebates” on part of a broker’s sales commission. That limits brokers from competing on price, which in turn causes homebuyers to pay higher commissions to brokers, the Justice Department said. The statute does not now define what constitutes a rebate, something the proposed regulation seeks to address.
The state contends the proposal will not have any fiscal impact. The Justice Department disagrees and its letter urges the commission to not restrain “an important dimension of price competition” that benefits homebuyers in Kansas.
Full Content: Global Competition Review
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