Regulator sues 13 real estate firms for price-fixing response to Trade Me

Thursday 17th December 2015

Thirteen New Zealand real estate firms colluded in agreeing to pass on increased Trade Me Group fees for property listings as part of a response to the auction site's increasing dominance in the market, the Commerce Commission alleges.

The competition watchdog filed proceedings in the Auckland High Court against realtors including Barfoot and Thompson, Harcourts Group, LJ Hooker New Zealand, Ray White Real Estate and Bayley Corp. It alleges price fixing and anti-competitive behaviour in 2013 and 2014 in response to Trade Me changing from a monthly subscription fee to a per-listing fee for properties advertised for sale, the commission said.

Property Page (NZ), owned by a group of major real estate firms, and itself the half owner of Trade Me rival realestate.co.nz, and three individuals are also named in the lawsuit. The commission has also issued warnings to eight Manawatu agencies it considers "likely to have breached the Commerce Act." Settlements have already been reached with Bayleys and Unique Realty, with the breaches admitted and agreement to pay penalties imposed by the court, it said.

The commission alleges the defendants breached the Commerce Act by agreeing a planned industry response to Trade Me’s changed pricing model. It says the parties agreed vendors would have to pay the listing fee to have their property advertised on Trade Me, and the agencies would not commit to any preferential or discounted listing fees with Trade Me.

The firms include two groups in Hamilton and Manawatu who had planned a regional response to Trade Me’s changed pricing.

In Hamilton, the commission alleges that Monarch Real Estate (trading as Harcourts), Lodge Real Estate (Hamilton), Lugton’s, Online Realty (trading as Ray White), Success Realty (trading as Bayleys), and two individuals who work for Monarch and Lodge, breached the Commerce Act.

It alleges the parties agreed that all listings would be removed from Trade Me’s website and vendors would have to pay the listing fee to have their property advertised on Trade Me.

In Manawatu, the commission has filed proceedings against Property Brokers, Manawatu 1994 (trading as LJ Hooker), Unique Realty and one individual who works for Property Brokers.

The agencies to receive warnings were Coast to Coast (trading as Bayleys), Alrose (trading as REMAX Palmerston North), Rural and Lifestyle Sales.com, Real Estate House Manawatu (trading as Ray White), Harcourts Team Manawatu Realty, Watson Real Estate, PGG Wrightson Real Estate and Monty’s Real Estate.

Trade Me shares last traded at $4.17 and have gained 14 percent this year.

BusinessDesk.co.nz

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