Two Hamilton real estate agencies have been fined $4 million between them for price-fixing.
Lodge Real Estate Ltd has been fined $2.1 million and Monarch Real Estate Ltd has been fined $1.9 million.
The two Hamilton companies were among several real estate agencies charged by the Commerce Commission with breaching the price-fixing provisions of the Commerce Act.
The Commerce Commission alleged that Lodge and Monarch, along with several other agencies, acted as a cartel and engaged in price-fixing behaviour that was anti-competitive.
Lodge and Monarch were the last companies to be fined in the case and brings the total penalties handed to all of the companies convicted of the Commerce Act breaches to almost $23 million.
The other companies that also received substantial fines in relation to the case were:
- Hamilton real estate agency Online Realty Ltd (trading under the Ray White Banner) $1.05 million.
- Property Brokers Ltd and its director Tim Mordaunt $1.5 million.
- Hamilton agency Lugton's Ltd $1 million.
- The head offices of Barfoot & Thompson, Harcourts, LJ Hooker and Ray White, total penalties of $9.825 million between them.
- Manawatu 1994 Ltd, (trading under the LJ Hooker banner) $1.25 million.
- Bayleys Corporation Ltd $2.2 million and Hamilton-based Success Realty Ltd $900,000.
- Unique Realty Ltd $1.25 million.
"Cartels can harm consumers and business by raising prices, restricting supply and changing the competitive dynamic between businesses," Commerce Commission Chairwoman Anna Rawlings said.
"The nearly $23 million in total penalties handed down in this case is substantial and from April next year cartel conduct will be a criminal offence subject to a maximum term of seven years imprisonment.
"We strongly urge businesses to familiarise themselves with the law and ensure they have processes in place to guard against collusion with their competitors," she said.
The comment stream on this story is now closed.
You can receive all of our property articles automatically by subscribing to our free email Property Newsletter. This will deliver all of our property-related articles, including auction results and interest rate updates, directly to your in-box 3-5 times a week. We don't share your details with third parties and you can unsubscribe at any time. To subscribe just click on this link, scroll down to "Property email newsletter" and enter your email address.
27 Comments
It may sound a bit harsh, but the real estate industry sure does attract its fair share of ratbags. Not sure why the barriers to entry are set so low and why the industry has trouble policing itself.
The structure of the industry favours ratbags because the interests of agents are not aligned with either buyers or sellers. Of course, the industry could fix this, but for some reason they don't.
"Property Brokers Ltd and its director Tim Mordaunt $1.5 million."
Getting right to the point, where have I seen that name before?!
Sounds familiar.
Is that Time To Pee?
Time To Ponder I think...
He said on many occasions that DGM's should be held accountable for their misleading comments. So I'm pretty sure he's OK being held accountable for his criminal conduct.
Property Brokers Ltd and its director Tim Mordaunt $1.5 million.
TTP. What say you?!
Licenses should be appealed and cancelled - but of course that won't happen....
If it was small companies carrying on like this they would be.
REINZ is certainly aware of all these developments - will they take action ? or will the REA....
Exactly the point I was going to make. How many licences have been revoked? I suspect none.
I'm sure most RE agents are generally good people. But I am also sure that real estate has a greater share of rat bags than most sectors.
The Arthur Daley's of this world. Just before lockdown I had the pleasure of meeting a few in Hamilton. Smug. Over quoting, and trying to push using the fear of under supply. Good to see a few getting caught.
Tim Mordaunt,
time to pay
that tough penalty
I am curious as to why the article highlights a couple of the agencies and not the others? I thought it might be because those companies were fined the most, but it was actually Bayleys that was fined the most.
It also seems that there was no RE companies that were not involved?
Get your facts straight - there are MANY Real estate companies not involved here
Or they haven't been caught yet. Just goes to prove that NZ REA's need more regulations to try to stop corruption.
Touchy subject?
Shall I rephrase it to - it seems like all the main players were involved. Which in turn can't really leave that many not involved (in the 07land that is)
I presume because this is news just out - others pleaded guilty - these two fought through 3 courts....
Thx, makes sense
because they were the "last" to be fined, i.e. recently. these cases go back years
This ruling is great to see and long may it continue, for a host of reasons, not least restricting supply and pushing up prices as per the Commerce Commission statement.
I hope decent resource is being put into investigating money laundering as well.
Good work ComCom and thank you for having our backs
They've been doing it all game ref!
Trademe jacked their prices up so much they decided to retalite.....got it wrong cost them big time..link to the details
https://www.feelangstone.co.nz/blog/2020/4/21/the-end-of-the-road-in-th…
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.