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Massive lawsuit against Boston real estate commissions could be coming.

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Massive lawsuit against Boston real estate commissions could be coming.

Watch this video for the details

How the real estate lawsuit started

Five sellers are named as plaintiffs in the case, which has drawn 500,000 others facing off against the National Association of Realtors, Keller Williams and HomeServices of America and seeking $1.78 billion in damages.

The trial that started this week involves some of the biggest names in residential brokerage, including NAR’s CEO Bob Goldberg, HomeServices’ CEO Gino Blefari and Keller Williams co-founder Gary Keller.

Rhonda Burnett, for whom the case is named, took the stand to discuss her experience selling her home with an agent from HomeServices’ subsidiary, Reece Nichols, Inman first reported. Burnett sold her home for $250,000 — $25,000 under asking — and paid over $15,000 in commissions. 

Burnett said that her listing agreement with the agent prompted her to select the commission rate she wanted to pay. The options included 7 percent, 8 percent 9 percent, 10 percent and a blank space where the agent had filled in 6 percent. 

As a Boston condo broker, if her claims are true, I’m appalled by this listing agreement, and I could tell you this would never fly here in Massachusetts.

Burnett said she chose 6 percent because it was ”lower than the rest,” and she claimed the agent told her “nothing was negotiable.”

Though Burnett said she had no qualms about compensating the agent she hired, she pushed back against the idea that sellers should be on the hook for paying agents they didn’t hire.

“I paid the buyer’s broker to negotiate against me and my husband, which resulted in a lower sales price,” Burnett said.

During cross examination, Burnett told an attorney for HomeServices that she considered doing a for-sale-by-owner to avoid commission costs, but she worried that her home wouldn’t sell without a listing on the Realtor MLS. 

Another plaintiff, Hollee Ellis, echoed Burnett’s frustration. The former high school English teacher said she paid a 6 percent commission on her home sale but the buyer’s agent’s portion worked out to more than 20 percent of the net equity of the sale. 

“I’m not against buyers’ agents,” Ellis said. “The buyer who chose them and who they’re working for should pay them.”

“I don’t know why these corporations feel they need to hide from juries, but they’re not going to be able to hide from this one,” Keel said.

Updated : Boston condo for sale website

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