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Home arrow News arrow Michigan Threatened by the Real Estate Anti-Discounter Law
Michigan Threatened by the Real Estate Anti-Discounter Law Print E-mail
Wednesday, 26 July 2006
Fortune has learned that Michigan Gov. Jennifer Granholm has come out against a state bill that would make Michigan the tenth state to outlaw discounted, no-frills real estate brokerages. The bill, which has already passed in the Michigan House, would impose so-called "minimum-service requirements" on all real estate agents in the state.

As with bills passed in nine other states including Texas and Illinois, the Michigan bill is being pushed by the state's powerful Realtor trade group and would effectively force all agents to provide full service. Some discounters would otherwise be willing to offer limited services and charge home sellers much less than the traditional 6-percent commission. It forces consumers to purchase services they neither want nor need.

Granholm, a Democrat facing a tough reelection campaign, is actually siding with the Bush Administration in opposing minimum-service requirements. While the Feds can't stop state legislatures from passing minimum-service bills, they have been speaking out against the bills in their roles as public advocates.

Realtor associations in Michigan and elsewhere defend their lobbying efforts as pro-consumer. Bill Martin, head of the Michigan Association of Realtors, says his organization wants to assure consumers are getting what they pay for.

Full-service realtors promise sellers many services, including hosting open-houses and handling negotiations with potential buyers. One key service is posting the seller's home to the Multiple Listing Service, homes-for-sale databases run by local Realtor associations. While the FTC can't control what legislatures do, it does have authority over Realtor boards that control local MLS's.

Austin agreed to stop discriminating against customers of limited-service realty firms by blocking their homes-for-sale from appearing on public MLS Web sites like One of them might be Michigan's largest MLS, Realcomp. As was the case in Austin, Realcomp blocks listings entered by limited-service realty firms from appearing on public MLS Web sites.

By M. Sese

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