Anthony Lamacchia: The Sitzer-Burnett case is in week two. This is my third video, and I’ve got a lot to go over with you today We’re going to talk about a whole bunch of things How buyers are the ones steering the process, how buyers choose the homes they want to see and want to buy. We’re also going to talk about Bob Goldberg getting on the stand and doing from what I can tell a terrific job. Also, want to discuss Sharon Millett, past NAR president for doing a great job explaining the history of buyer agency, how things were before, how they’ve been since, and talking about that change in the mid-90s, late 90s, early 2000s when buyer agency became a thing. Also want to spend a few minutes talking about the Wall Street Journal Editorial Board who frankly I’m angry with, I’m unhappy with, I see no part of positive articles out of them, and I’m going to get into that. Lastly we’re going to talk about Robert McGill, the attorney for Home Services of America and what a terrific job I think he’s doing. Today in particular, he went in there and asked for a mistrial. He explained why. A lot of it’s because of Ketchmark behavior, and I’m going to get into that. By the way do you notice I Correctly said Ketchmark name? Last week in my second video, I called him catch men the whole time. Michael if you’re seeing this, I don’t care if you’re offended. You know why? You’re offending me, and you’re offending 1.5 million Realtors and everyone else that works with them across the country when you try to insinuate that we as Realtors don’t take our fiduciary duties serious and we don’t do our absolute best to represent our clients and do what is best for them. The notion that you try to make that buyer agents don’t do everything in the best interest of their client is ridiculous. Now, let’s jump in.
How do buyers find properties? Mr. Ketchmark Michael keeps talking about how Realtors steer buyers on what properties that they can see. Folks, there is no steering a buyer. There’s no hiding properties from buyers. You can only hide properties from buyers years and years ago 2030 plus years ago prior to MLS. All this bad talk about the MLS as in stating that the MLSs aren’t fair and transparent. No,no, that’s how it was before there was an MLS. That’s why MLS is here. Buyers find properties, buyers see properties. Virtually 100% of buyers out there are seeing properties online first. Over 60% of buyers that buy a home admit they first saw the home online. Zillow points out how 88% of buyers enlist an agent to help them buy a home.
There’s tremendous value in buyer agency and this case is going to blow it up and make it much more difficult for people to have a buyer’s agent. I know Michael Ketchmark has no problem with that because he wants to go to the Australia system where only the affluent have buyer agents. That’s Ridiculous. Absolutely ridiculous and unfair to first-time buyers, buyers that have less means to afford a buyer’s agent, and so on. I’m going to go further into that in a few minutes. Next, Bob Goldberg, CEO of the National Association of Realtors. He has been in combat over this case for three years now four years and he’s done a terrific job, and he sure proved his worth though he didn’t need to me in his performance on the stand over the last couple of days. They cross-examined him they asked many questions. Michael Ketchmark being the showman that he is pointed out all kinds of crazy examples. He talked about things that were funny because when I read the transcript here or some of the commentary in RAS Media, one of the things that’s interesting is he tries to point out– Ketchmark points out how the trade association should not dictate fees, should not be telling members to charge the same amount, but then he makes a comment that I thought was interesting and contradictory.
Michael, if you’re watching watch yourself because this guy here in Boston is listening. At one point Ketchmark asked Goldberg if any I would change a rule, if it was proven that a rule raised commissions with Goldberg responding that members and committees make those decisions. Great answer then Ketchmark responded, “You would just let them do it?” Pressing Goldberg on whether he would just be a passenger in the scenario. Ketchmark went further and asked any asked what any I would do with these policies blah, blah, blah. Goldberg answered and then finally said– Big bull Goldberg answered, “I don’t know the answer. Those things are free and in the open market.” I love what Goldberg said later, “Sellers make their decision on what to share or to share anything. They can choose that., They can choose a realtor.”
Ketchmark being the wise guy that he is and then “Hey, you could say the same about me. I’ve made examples last week about menus, right?” Ketchmark talks about how the chicken industry was doing things to create the same pricing and they went to Goldberg and Goldberg said, ” I need you to explain this chicken law to me.” Good one Bob. Let me keep going here. Stay with me. “And in their MLS rules create a market rife with steering where buyers agents discourage or prevent their clients from seeing lower commission properties.” that’s Ketchmark talking. Michael, you couldn’t possibly be more out of touch with how this works. You also couldn’t possibly be more out of touch with how it’s worked over the last five years. Your arguments here, even if it had any merit, maybe it did 30 plus years ago. It certainly doesn’t now. Your case is completely out the window in the last four or five years. There’s nothing for sale. Inventory is extremely low. We have a historically low inventory. You’re making it sound like Agents can hide properties, they can stop their buyers from seeing it. Lunacy.
There’s another one. Ketchmark also pointed out that a study cited by Goldberg yesterday which stated that using a realtor increases the sale price of a home by 20%. Okay, why is that bad? Why is it bad for a trade association or for Goldberg as the CEO to state a fact when home sellers hire Realtors their home sell for more? Folks, this case and everything about it, it’s not all about buyers, though They’re the ones that will be affected the worst if Michael Ketchmark is successful, but he doesn’t care. It’s also about homeowners and homeownership. When homeowners hire Realtors, their homes are marketed much better. They’re exposed to a massive marketplace through the multiple listing service that syndicates to several other websites. Goldberg pointing out or anyone pointing I was pointing out that home sell for more when people hire Realtors, nothing wrong with that.
I could go on and on. Bob, I think you did a good job. I’m going to continue. Court update. Goldberg takes the stand as NAR defends value of buyer agents. Now this is interesting. Goldberg and NAR brought in Sharon Millett. I don’t know Sharon, but I read her comments. I read what she said and she did a terrific job. She’s a past president of the National Association of Realtors. She talked a lot about how the value of buyer agency and the value of the agent’s role in representing a buyer. All of the things that they do, helping buyers sort through properties, assessing their goals with them making sure they don’t get in over their heads, et cetera. All of those kinds of things are great. She also pointed out how she was a part of a presidential advisory group years back that saw our problems before regulators did. She’s right about that.
This is in the mid-90s. I remember it as late 90s, early 2000s, but nevertheless it was in that five eight-year period and she said, “The rule change created buyer compensation was meant to protect buyers and sellers.” Glass pointed out, Ethan Glass is the attorney for NAR, that NAR didn’t receive commissions paid to those buyers agents. The point they’re making here, and I talked about this last week, is before there was buyer agency, before agents had a fiduciary duty to represent the interest of their buyers, there was something called sub-agency. It’s a little confusing.The bottom line that I want to point out is, in essence, everyone was representing sellers years ago. That’s before client relationships became clear. Agents accepted fiduciary duties when they were representing buyers as a buyer’s agent and so on.
She was a part of that process. No government or agency or Ketchmark came out and said we were doing something wrong. The association worked on that themselves, made a change that was very successful and our industry has been running that way for 20 to 25 years and it’s run very well. very well on cross-examination of Millet. Ketchmark honed in on commissions, particularly those paid to buyers’ agents have remained static despite huge technological advances particularly in online access to information. Prices of everything don’t go down, particularly in the last three or four years. Have the prices of cars gone down? The prices of doors, sheetrock, baseboards, televisions? All these different things, prices have gone up in the last few years. The part that Ketchmark doesn’t comprehend and he probably never will because he spends his days and spends his years going after big industries
in seeking settlements. That’s what he does, whether there’s merit or not. The part that he doesn’t understand is we are in a relationship business. Buying a home is a very emotional time, very important time in one’s life. People take that very seriously and people need someone to guide them. Michael just compares it to technology and selling widgets. Vastly different, Michael, but I know you’ll never get that. Hopefully, the jury does, and I think they will. Zero discussion about commissions at NAR meetings, totally a fact. I mentioned that before. I said that last week. The notion or the thought that we get together at these annual meetings and we all whisper to one another, “Hey, you charge this, I’ll charge that, you hold your ground, I’ll hold mine.” Absolutely, positively ludicrous. Another thing that Goldberg said is that there shouldn’t be any interference from NAR on the subject of commissions. He’s right. I read the journal every day since the day after 9-11 when I subscribed. It’s generally a very good newspaper with a lot of good reporters, but I can honestly say I’m disgusted with the editorial board over the last 10 days, disgusted. The trash that they are putting out is unbelievable and it makes me wonder if they’re related to someone there or if these folks are going to be buying or selling a home soon, like that Shulman gentleman from Texas A&M.
Last week, one thing I forgot to mention is he clearly is selling his home soon. The guy complained about commissions so much. Now, back to the subject at hand. Look at this. This is last week. Realtors face an antitrust reckoning. A federal trial starting Monday could yield major benefits for home buyers. What? The biggest risk in this case is to home buyers, particularly those that don’t have the means to afford an agent. I understand it’s an editorial board. I understand that it’s in opinion nature, but it’s ridiculous. I’m going to read some of the comments. It’s clear as evidence presented by the plaintiffs that the realtor’s primary interest is ensuring buyer’s brokers make a 3% commission no matter what. I get it, this is opinion, but this is a bunch of garbage. Instead of reading this garbage anymore, what I’m instead going to do is read Jessica Edgerton’s comments, her post from her LinkedIn profile. If you don’t follow Jessica Edgerton on LinkedIn, you need to. She’s the chief legal officer and executive vice president for leading real estate companies of the world. She put out nine points on her LinkedIn last week.
She said the article lacks any acknowledgment of the financial burden that a win for the plaintiffs would put on homebuyers, particularly first-time homebuyers, veterans, underrepresented communities, and low-income families. I want to repeat that part. Veterans, first-time buyers, underrepresented communities, and low-income families. That’s who would feel the majority of this financial burden. Great job, Jess, on that point. Number eight, no mention of vital role MLSs play in providing the most unique, robust, pro-consumer marketplace in the world. Great job, Jessica. She’s completely right, I said that five minutes ago. Prior to the MLSs, there were backdoor deals, there were properties that buyers weren’t seeing, there was potential for realtors to not show a property to a buyer, not nowadays, and that’s thanks to the MLS. I also want to read the beginning of Jessica’s post. Shame on the Wall Street Journal Editorial Board for this hack job. Let’s start with the wacky byline claiming that a win for Burnett could yield major benefits for homebuyers and go from there. That’s pretty funny, I just said the same thing. She put it in there.
I guess I was naive to think that last week’s garbage editorial in the Wall Street Journal would be the last. Interesting to me that last week in my videos, I mentioned how I despise when they call us the cartel and how Ketchman mentioned that and Jack Ryan used to say that from Rex Real Estate, and this week, what do we wake up to Monday morning? Wall Street Journal editorial referring to us as the cartel. Now this particular one was all over the road. Alyssa Finley wrote it. Wasn’t as well written, but one thing that I found interesting about this piece of garbage is they’re criticizing our association for speaking up to the FHFA back in the spring when they were going to raise fees on borrowers who were more credit-worthy. We as an association went to them and said, why are you raising fees at all? We do that often. We always speak to government authorities, mortgage companies, government-sponsored enterprises to bring costs down for homeowners. This editorial makes it sound like that’s bad. Why that would be bad, I have no understanding.
Next, and this is last but not least. I want to shout out Robert McRael, Home Services of America attorney for a good representation, I think, over the last few days on behalf of Home Services. He went in there and he talked about many things, and this morning they asked for a mistrial. They did that because Ketchmark is totally going off the rails. This guy showed a video yesterday that he had never said he was going to show to the jury. Even though now they’re asking the jury to act like they haven’t seen it, it’s in the jury’s minds. I think he was right to do that. He also pointed out how Ketchmark is giving nightly press conferences which make it harder for the jury to ignore the press coverage of the trial. Think about that. This Ketchmark character goes into court all day, and then he’s on the news, and what’s interesting to me is the news seems to be putting him on at his will. I don’t see folks from our side in the news, one or two, and it’s often not those that are well explained. Any news organizations watching that, put me on Good Morning America, and I’ll answer any question all day long. Put me on the evening news with Ketchmark sitting next to me, and I’ll debate him all day long. Don’t just pick any random realtor that doesn’t have an understanding of this case and the situation and the false charges that are being made here, okay?
I thought McGrill was good to do that. One of the things he said is the plaintiff’s conduct has become worse each day. It’s irrevocably contaminated the jury. McGill was right about that. He’s totally right about that. That’s just more behavior out of Ketchmark that he seems to be allowed to do in this courtroom, and I hope that changes. I hope I’ve helped you all better understand the case. I hope you have a more open mind about it and are seeing some of the points from the defendant’s side. Stay tuned. Whether you’re watching me on Instagram, Facebook, or YouTube, I will be back with more videos on this case and in the months to come on several other topics related to this case, like the MLS pin settlement. Thank you.