Real estate agencies will have more freedom to decide where they list properties for sale and rent, after REA Group gave the Australian Competition and Consumer Commission an undertaking to remove restrictive clauses from its contracts.
The ACCC had raised concerns that REA’s agreements with agencies included provisions requiring or incentivising agents to list all their properties on realestate.com.au, limiting the ability of rival portals to compete.
Under the undertaking, REA can no longer require or incentivise agencies to list all or most properties on realestate.com.au.
Previously, most REA contracts locked agencies into listing every property for sale or lease on the site, and also required or incentivised agencies to list properties with premium features that attracted higher fees.
The ACCC press statement said REA has acknowledged the ACCC’s concerns that its conduct may have breached competition law and has committed to changing its operations for three years under the undertaking.
“REA’s undertaking resolves this issue in a timely manner and addresses our concerns. We expect that ultimately the benefits will flow from the real estate agents to their clients, Australian property owners,” said ACCC Chair Gina Cass-Gottlieb.
In a written response, REA noted: “The ACCC has not issued legal proceedings against REA and there has been no finding of legal wrongdoing. We’re pleased to have reached a resolution with the ACCC.”
The ACCC said the change would give agents more say over how vendor and landlord clients list their properties.
“Because of the ACCC’s intervention, REA will give greater flexibility to agents in how their vendor and landlord clients list their properties for sale and rent,” she said.
The ACCC said the provisions in REA’s contracts had limited customer choice and made it harder for other listing services to compete.
“This is a win for competition in the real estate listing market and is expected to enable real estate agents to offer their vendor or landlord clients the listing service that best meets their property advertising needs,” Ms Cass-Gottlieb said.
“We encourage vendors and landlords to discuss available listing options with their agents following REA’s undertaking, so they can consider the different listing options and fees on different portals to determine what best suits them,” Ms Cass-Gottlieb said.
The undertaking is published on the ACCC’s website.