<HTML> <HEAD> <title>WebForm1</title> <meta name="GENERATOR" content="Microsoft Visual Studio .NET 7.1"> <meta name="CODE_LANGUAGE" content="Visual Basic .NET 7.1"> <meta name="vs_defaultClientScript" content="JavaScript"> <meta name="vs_targetSchema" content="http://schemas.microsoft.com/intellisense/ie5"> <META http-equiv=Content-Type content='text/html; charset=UTF-8'> </HEAD> <body > <TABLE id="Table1" cellSpacing="1" cellPadding="1" width="100%" border="0"> <TR> <TD><b>Comment Number:</b></TD> <TD>518795-00388</TD> </TR> <TR> <TD><b>Received Date:</b></TD> <TD>11/28/2005 7:32:14 PM</TD> </TR> <TR> <TD><b>Organization:</b></TD> <TD></TD> </TR> <TR> <TD><b>Commenter:</b></TD> <TD>Nadel, Mark</TD> </TR> <TR> <TD><b>State:</b></TD> <TD>VA</TD> </TR> <TR> <TD><b>Agency:</b></TD> <TD>Federal Trade Commission</TD> </TR> <TR> <TD><b>Rule:</b></TD> <TD>Competition Policy and the Real Estate Industry</TD> </TR> <TR> <TD><b>Docket ID:</b></TD> <TD>To Be Added</TD> </TR> <TR> <TD><b>Attachments:</b></TD> <TD><a href='518795-00388.pdf'>518795-00388.pdf</a>&nbsp<a href='http://www.adobe.com/products/acrobat/readstep2.html' target = _blank >Download Adobe Reader</a><br></TD> </TR> </TABLE> <hr/> <b>Comments:</b><br/><br/> From: Mark S. Nadel&nbsp;<B>&nbsp;</B>&nbsp;To: Competition and Real Estate Workshop  Comment, Project No. V50015 Department of Justice Federal Trade Commission Re: My Comments in the Proceeding on Competition Policy and the Real Estate Industry Date: November 28, 2005 I had hoped that by this time I would have completed a reasonably coherent full draft of a law review article that I am writing critical of the rate structure used to calculate the commissions paid to residential real estate brokers. Unfortunately, the article continues to evolve and require substantial work, and I am not comfortable sharing it in its entirety in its current, flawed state. Nevertheless, given the DOJ and FTC s commendable efforts to address some inherent problems with competition in the residential real estate brokerage industry, I am submitting two excerpts from that draft article, which address two aspects of the dominant, traditional, percentage-of-sale price commission structure, which I believe, have generally been neglected by other researchers: 1. The arrangement whereby those selling homes are the ones who set the fee that will be paid to the agents working with and supposedly serving the interests of home buyers (the cooperating agent fee listed in the MLS). 2. The use of a percentage-of-sale price commission, which bases the fee paid to the agents on the sale price of a home, irrespective of the quantity or quality of service provided. I recognize that my analysis is incomplete and will require some corrections, clarifications, and further research. Nevertheless, I hope that by identifying and offering a reasonable preliminary discussion of these matters, it will aid policymakers in their effort to identify the steps that may help channel competition in the brokerage industry to better serve the interests of home buyers and home sellers. I have attached an abridged, edited version of my current introduction as well as the two subsections of a later section, which address the two issues I just mentioned. <A name=RDACT1></A> </body> </HTML>