Real estate agency fined $1 million for price fixing
9 August 2017
Hamilton real estate agency fined more than $1 million for price fixing
Hamilton real estate agency Online Realty Limited (trading under the Ray White banner) has been ordered to pay a penalty of $1.05 million for its part in a national anti-competitive price fixing case.
The Commerce Commission filed proceedings in December 2015 alleging 13 national and regional real estate agencies including Online Realty breached the Commerce Act by entering into anti-competitive agreements in response to Trade Me changing its property listing fee.
Online Realty admitted it agreed with the other defendants to pass on the cost of listing on Trade Me to vendors in response to Trade Me changing its listing fee from a monthly subscription to a per listing fee. Online Realty also admitted unlawful price fixing by agreeing with the others that vendors’ existing listings would be removed from Trade Me.
In her judgment released yesterday, Justice Patricia Courtney said while Online Realty was not a ringleader in the case, the conduct has brought a significant and lasting change to the market, with the majority of Hamilton real estate agents continuing to pass on the cost.
To date the case has seen more than $18.97 million in court-imposed penalties.
The remaining defendants in the case are due to go to trial in September 2017. The Commission cannot comment further until court proceedings are concluded.
In December 2015, the Commission filed proceedings in the High Court at Auckland for alleged price fixing and anti-competitive behaviour by 13 national and regional real estate agencies, a company owned by a number of national real estate agencies, and three individuals. The Commission also issued warnings to an additional eight agencies for their role in the conduct.
The proceedings relate to alleged conduct in 2013 and 2014 by the national head offices of five major real estate companies, and separately by agencies in Hamilton and Manawatu.
Proceedings and penalties concerning
national real estate agencies
• Head offices of Barfoot & Thompson, Harcourts, LJ Hooker and Ray White ordered to collectively pay $9.8 million.
• Bayleys ordered to pay $2.2 million.
• Property Page Limited ordered to pay $100,000 towards the Commerce Commission’s costs.
Proceedings and penalties concerning Hamilton real estate agencies
• Online Realty Ltd (trading under the Ray White Banner) ordered to pay $1.05 million.
• Lugton’s Limited ordered to pay $1 million.
• Success Realty ordered to pay $900,000.
• The case against Lodge and its director Jeremy O’Rourke, and Monarch (trading as Harcourts Hamilton) and its director Brian King is due before the courts in September 2017.
Proceedings and penalties concerning Manawatu real estate agencies
• Manawatu 1994 ordered to pay $1.25 million.
• Unique Realty ordered to pay $1.25 million.
• Property Brokers and its director Tim Mordaunt ordered to pay $1.45 million and $50,000 respectively.