As the voracious housing market slows for its usual summer break, buyers and sellers across the nation remain locked in an uneasy and uncertain wait for the result of a billion-dollar legal verdict that could hit their wallets.
The verdict in question is a federal class-action lawsuit against homebuilders, which accuse them of artificially inflating the price of new homes, thus denying consumers their right to the fair and open market. If the jury concludes in favor of the plaintiffs, the homebuilders face as much as a billion-dollar payout to buyers and sellers across the nation.
While the result of the verdict is pending in the legal system, buyers and sellers have been frozen in a standstill as they wait to find out if their pocket books will be hit hard if the homebuilders lose the case.
The lawsuit, titled “Estate of Robert Robertson v. BOA and Associates”, was first filed by the estate of Robert Robertson in 2017. The Robertson estate alleged that BOA and Associates, one of the largest homebuilders in the U.S., violated the Sherman anti-trust law by “engaging in a long-term pattern of deceptive and anti-competitive financing practicies”.
According to the lawsuit, BOA colluded with loan brokers, lenders, and other Real Estate Service Providers (RESPs) for the purpose of inflating prices for new homebuyers. The alleged scheme had the effect of decreasing the supply of open and available homes while simultaneously driving up new home construction costs, thus resulting in artificially inflated new home prices.
The case is now being heard before a jury in the Northern District of California. The jury is currently deliberating on the evidence presented at trial, which means buyers and sellers across the U.S. will have to wait for the verdict to know how it will affect them.
Although the result of the verdict remains unknown, its impact has already been felt by some buyers and sellers. Many have expressed frustration as they feel they are unable to effectively plan for the future while the cloud of uncertainty hangs over the housing market.
The only thing that remains certain is that the outcome of this case will have a profound impact on the real estate industry and will no doubt affect countless buyers and sellers across the nation. For the time being, they will have to hunker down and wait for the result of the billion-dollar verdict to be revealed.