An expensive cartel arrangement

The Herald reports:

Four major real estate agencies have been ordered to pay close to $10 million combined for price fixing.

Barfoot & Thompson, Harcourts, LJ Hooker and Ray White appeared in the Auckland High Court this morning over their conduct 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 Commerce Commission alleged that the agencies breached the Commerce Act by agreeing a planned industry response to the changed pricing model.

The commission said 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.

Justice Paul Heath today ordered Barfoot & Thompson to pay $2.575 million, Harcourts $2.575m, LJ Hooker $2.475m and Ray White $2.2m.

Bayleys was also subject to the agreement but that case was settled earlier this year after the firm agreed to pay a $2.2m penalty.

That’s a pretty large fine. Big enough for sure to discourage such behaviour in future.