A U.S federal jury has recently found that two of the largest real estate brokerages in the U.S, HomeServices of America Inc. and Realogy Holdings Corp., were liable for inflating real estate commissions and granted damages of 1.78 billion dollars.
This case, which took place in Philadelphia, concerns accusations from a number of homebuyers, who claimed that the two companies conspired to inflate the commission fees that they charged homebuyers in order to maximize the profits generated from the transactions.
The law firm representing the buyers, McAndrews Law Offices, P.C. commented on the ruling, stating that this is a great victory for homebuyers everywhere. They argued that HomeServices and Realogy used their vast market size and power to manipulate the real estate market, resulting in homebuyers paying more for their new homes. They also said that the jury saw past any attempts at obfuscation on the part of the defendants and found that the companies had intentionally inflated the fees associated with buying a home.
For their part, the two companies accused of the fraud have denied any wrongdoing in the case. HomeServices of America Inc. has released a statement, claiming that they had acted appropriately and within the confines of the law when pricing their services to buyers.
The exact amount that each individual will receive has yet to be determined. The attire of the plaintiffs has estimated that the total damages will be about $5,000 for each homebuyer affected, and have reassured those affected that the payouts will be made as soon as possible.
The ruling in this case should serve as a warning to real estate brokerages to be mindful of how they price their services in order to avoid a similar fate. It is a reminder of the power of the consumer to effect change in the industry and protect their interests.