Commerce Commission charges Bayleys, Barfoots, Harcourts, LJ Hooker and Ray White with price fixing

The Commerce Commission has filed price fixing charges against most of the country’s largest real estate agencies, including Barfoot & Thompson Ltd, Harcourts Group Ltd, LJ Hooker NZ, Ray White (Real Estate) Ltd, and Bayley Corporation Ltd.

The charges filed in the Auckland High Court allege the companies breached the Commerce Act in 2013 and 2014 by agreeing on a planned industry response to Trade Me’s changed pricing model.

The Commission alleges the conduct occurred in response to Trade Me’s change from a monthly subscription fee to a per-listing fee for properties advertised for sale on its website.

The Commission alleges the parties agreed that vendors would have to pay the listing fee to have their property advertised on Trade Me and that the agencies would not commit to any preferential or discounted listing fees with Trade Me.

The Commission also alleges that Property Page (NZ) Ltd aided and abetted the agencies in establishing and implementing the agreement.

Property Page is owned by Harcourts, LJ Hooker, Ray White, Barfoot & Thompson, and the company in turn owns 50% of Realestate.co.nz which is a competitor to Trade Me Property.

The Commission has agreed to a settlement in principle with Bayley Corporation Ltd, to resolve the proceeding against it.

That would involve Bayleys admitting that its conduct breached the Commerce Act and paying a penalty to be imposed by the court.

The Commission said settlements had not been agreed with any of the other defendants.

The Commission has also filed charges against some real estate agencies and individuals in Hamilton and the Manawatu.

In Hamilton the Commission alleges Monarch Real Estate Ltd (trading under the Harcourts banner), Lodge Real Estate Ltd, Lugton’s Ltd, Online Realty (trading under the Ray White Banner) Success Realty Ltd (trading under the Bayleys banner), and two individuals that have not yet been named, breached the Commerce Act by by agreeing on a planned regional response to Trade Me’s changed pricing policy.

This is alleged to have involved the parties agreeing that all listings would be removed from Trade Me’s website and that vendors would have to pay to have their listings listed on Trade Me.

The Commission said the two individuals who have not been named work for Monarch and Lodge.

In the Manawatu, the Commission has filed proceedings against Property Brokers Ltd, Manawatu 1994 Ltd (trading under the LJ Hooker banner), Unique Realty Ltd and one individual, alleging that they breached the Commerce Act by agreeing with each other and other agencies on a planned regional response to Trade Me’s changed pricing model.

The Commission said it had agreed in principle to a settlement with Unique Realty Ltd, which would involve the company admitting its actions breached the Commerce Act and to pay a penalty to be imposed by the court.

The Commission said the unnamed Manawatu individual facing proceedings works for Property Brokers.

The Commission said it also believed that a number of other Manawatu agencies were likely to have breached the Commerce Act and had therefore issued warnings to: Coast to Coast Ltd (trading under the Bayleys banner); Alrose Ltd (trading as RE/MAX Palmerston North); Rural and Lifestyle Sales.com Ltd; Real Estate House Manawatu Ltd (trading under the Ray White banner); Harcourts Team Manawatu Realty Ltd (trading under the Harcourts banner); Watson Real Estate Ltd; PGG Wrightson Real Estate Ltd; and Monty’s Real Estate Ltd.