Realtor Battles in Missouri
This article has a good summary of the ongoing war between regular real estate brokers and so-called discount brokers, and how it has resulted in new legislation in Missouri.
Discount brokers offer specific services -- like listing a property in the Multiple Listing Service -- in return for a smaller fee or commission than a regular real estate broker would charge. The Missouri legislation (which passed their House and Senate unanimously, and has been signed by the Governor) requires brokers to be involved in handling and negotiating offers and counteroffers for their clients. What does all this mean to home buyers and home sellers? Follow the money and the influence:
-Regular real estate brokers are under a lot of pressure from discount brokers.
-The legislation was sponsored by a real estate agent.
-The Missouri Realtors Association spent $50,000 for a lobbyist to get the Governor to sign the legislation. The lobbyist has close ties to the Governor's father.
-The Justice Department and the FTC both believe that the legislation (a) will reduce competition among brokers, "causing some home sellers to pay thousands of dollars more in commissions," and (b) "does not address any demonstrated consumer harm."
I think there could be an analogous situation to my estate planning practice here. A discount broker might be the equivalent of an estate planning attorney who charges a small fixed fee to review estate planning documents drafted by the client using Will and Trust software. Would I ever offer such a service? No -- I think the risk (potential malpractice because I didn't catch a mistake in a document I didn't draft) far exceeds the reward. But do I oppose the right of all Illinois attorneys to offer such a service? Of course not. Even though I think my rates are reasonable, I know that not everyone agrees and that not everyone can afford (or even wants) my services. Shouldn't consumers who want less be able to pay less?
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