Information wants to be free, and thanks to the decision of a federal court, online real estate listings will be unencumbered by California licensing requirements. Congratulations to the Institute for Justice, who represented ForSaleByOwner.com, a company that runs a classified advertising website that allows individuals to buy and sell homes. California’s demand that websites obtain a real estate broker’s license to publish real estate advertising and information was held a violation of the First Amendment. California law exempted newspapers, and the California Department of Real Estate argued that a listing in a newspaper is somehow different than on a website – the court labeled this as “wholly arbitrary.”
This case exemplifies the disparities in laws that favor brick-and-mortar companies over e-commerce. I wrote this NRO article about a similarly situated company in New York City that provides online real estate listings. LaLa Wang, owner of MLX.com, ran into the powerful New York state regulators (who are just as bad as their California brethren) and against a bad license requirement to be an apartment information vendor. The circa-1974 law requires anyone providing real estate rental or sale information to save paper copies of transactions and correspondence – not particularly applicable to a 24/7 website. This open letter to the NY Secretary of State on her behalf was a principled gesture from which I received no response.