Real Estate Industry Faces Turmoil as Commissions Verdict Shakes Market
Zillow Group Inc. and other real estate stocks plummeted after a Missouri jury ruled that the National Association of Realtors colluded to maintain high brokerage commissions, resulting in nearly $1.8 billion in damages. The verdict raises concerns about the commission-sharing system and the potential for the federal government to ban sharing commissions, which could disrupt the real estate industry. The Justice Department is already scrutinizing the commission-sharing system, and the verdict in the Missouri case adds to the mounting antitrust risk. Zillow's stock fell 6.9%, while other brokerage shares also declined. The lawsuit, along with other ongoing cases, challenges the commission system in the US, which is considered more expensive for consumers compared to other countries.