Homie, the Utah tech real estate company that vowed to “disrupt” the home-buying industry, now claims that industry actively blocked any such disruption and fought to maintain the status quo — at the expense of Homie and customers.
In a lawsuit filed last last week, Homie pointed a finger at the National Association of Realtors (NAR) for what the company called “anticompetitive” practices. The suit claims NAR’s rules “erected substantial barriers to entry for new competitors,” making it impossible to innovate in the industry.
And Homie is not the only victim, the lawsuit claims; the status quo has made real estate needlessly expensive for prospective homebuyers and sellers.
“Had Homie been allowed to compete with Defendants and their co-conspirators, it would have gained market share at Defendants’ expense while posing a competitive check on Defendants’ ability to charge exorbitant prices for brokerage services to consumers,” Homie argues in its complaint. “By excluding Homie and other new entrants, Defendants, in a single stroke, harmed competition, harmed consumers, and caused injury and damages to Homie.”
An NAR spokesperson did not directly address Homie’s claims — it will do that in court, the spokesperson said — but said in a statement that its “goal is to promote local real estate marketplace that provide fair and equal access to property information and promote competition while empowering Realtors to serve clients on their homebuying and selling journeys.”
Homie names several real estate brokerages — including Anywhere Real Estate, RE/MAX and Wasatch Front Regional Multiple Listing Service — as “co-conspirators” who championed NAR’s “anticompetitive” rules in order to squash industry disruptors, like Homie.
One defendant, Home Services of America, said in a statement it could not comment on the specific claims, but “any assertion that competition within the real estate industry has been stifled is simply without merit.”
“The real estate industry has seen significant evolution and dynamic changes over the past decade,” said Executive Vice President Chris Kelly. “There is a near-constant introduction and shuffling of new and varying business models entering the real estate space given the competitive and ever-changing nature of the market.”
RE/MAX, Keller Williams and Anywhere Real Estate declined to comment.
Homie said the ramifications of its lawsuit extend beyond its own business model.
“Our fight is about so much more than savings,” Homie said in a statement on its website. “It’s about every homebuyer and seller who’s had to endure a system that puts profit over people.”
Homie’s suit is the latest in a wave of scrutiny aimed at NAR. The trade group updated its rules this year in response to an antitrust settlement; it continues to deny any wrongdoing, but will pay $418 million over the next four years and agreed to new rules that separate a Realtor’s commission from a property’s listing price. The rules took effect Aug. 17.
Real estate an exclusive ‘club’ with ‘unwritten rules’
Homie makes some of the same antitrust claims as previous litigation, including the claims for which the NAR has already settled. But the lawsuit also presents a clear narrative of the challenges Homie has faced since its founding in 2015.
In short, the lawsuit claims, Homie tried to disrupt an industry that wanted it to fail, and was repeatedly shut out of an exclusive “club.”
The Utah company entered the scene in 2015 and offered home sellers a flat fee to list their home. The fee structure did away with exorbitant commissions, the company claimed, which ultimately lowered the overall cost for homebuyers, too.
But Realtors didn’t like that new structure, Homie’s lawsuit claimed — because it meant they earned less money. Home sales are a deal between four main parties: the buyer, the seller, and the agents representing each.
The status quo of home sales, Homie argues, is that home sellers typically agree to pay their broker a commission of between 5% and 6%. The seller’s broker then shares their commission with the buyer’s agent. To a prospective homebuyer, Homie’s lawsuit argues, it looks like they’re getting their brokerage service for free — the broker isn’t charging them a direct commission. But the buyer is, in fact, paying a price, Homie claims; it’s just built into the overall listing cost, hidden from view and inflating the home’s price.
NAR’s new rules now require buyers’ agents to disclose their compensation in writing, up front, before showing a property. They also prohibit selling agents from including commission fees on multiple listing service (MLS) listings.
But before those rules took effect, Homie argues, buyers agents were incentivized to only show homes with high commission fees, because it meant they, too, made more money on the deal. Buyer agents could filter homes on MLS networks according to commission, the lawsuit claims.
Homie took direct aim at the industry in some of its advertising, seen on billboards along Interstate 15. “Agent charging you $30,000 to sell?” one billboard read. “Eat my shorts.”
Most homes on the market are advertised through multiple listing services, but those services are owned by NAR members and therefore are subject to NAR’s “Exclusionary Rules and Policies.” Realtors — a copyrighted title reserved to NAR members — are incentivized to “adhere to and help implement terms that significantly restrain competition,” the complaint claims.
Homie says it has direct evidence of such exclusion. Utah Realtors actively conspired against Homie from the outset, the complaint claims, and explicitly avoided working with Homie’s clients. One client emailed Homie to cancel their contract because they found a “great house,” but “several agents refuse to show me properties when I mentioned that I was working with Homie,” according to the complaint.
According to the lawsuit, Realtors themselves also told Homie agents that they would not show their homes unless Homie agreed to higher commission fees.
“If you up the commission, I will bring my buyers,” one Realtor emailed, according to the complaint. “If not, I will not. It’s a disservice to your client.”
Realtors also posted their grievances on industry Facebook pages and forums, according to the complaint.
It was all part of the industry’s “anticompetitive campaign” to exclude Homie from the Utah real estate market, Homie claims. And, Homie says, it worked.
As it lost clients, Homie says its market value declined, and Utah Realtors celebrated. Homie had “broken the ‘unwritten rules’” of the “tight-knit realtor community” in Utah, one Realtor is accused of writing, and had “tried to be ‘members of a club nobody wanted them to be a part of.’”
Still, it is the written rules for which Homie is suing NAR. The association’s policies all shaped an industry that stifles competition and innovation, Homie argues.
Homie has previously blamed a volatile real estate market for its struggles. It started laying off staff in 2022, the same year co-founder Johnny Hanna stepped down as CEO. His successor, fellow co-founder Mike Peregrina, left a year later. Homie’s team got smaller as the company cut more staff.
And then, in April, it told most of its remaining brokers that their time was up. A select few stayed on as contractors, which a company attorney said at the time is more aligned with standard industry practice.
The lawsuit filed last week blames the industry at large, and NAR specifically, for Homie’s troubles. Were it not for NAR’s “exclusionary” policies, the complaint says, Homie and other “innovators” might have had a fighting chance.
Homie is asking a federal judge to hold NAR and its “co-conspirators” liable for the damages Homie says it suffered, including lost profits, in “an amount to be determined at trial.” It is also asking for a permanent injunction of NAR’s Clear Cooperation Policy — the rule it says keeps “low-price competitors” out of the game.
“By shining a light on these unjust practices, we’re not just hoping for change — we’re demanding it,” Homie said on its website. “We envision a real estate industry where fairness and equity are the standards, not the exceptions. We’re committed to building a future where the real estate market works for everyone, not just a privileged few.”
Shannon Sollitt is a Report for America corps member covering business accountability and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.