Lawmakers seek regulator answers on not challenging massive acquisition
A group of US senators is urging federal regulators to explain their decision not to challenge Rocket Companies’ $1.75 billion acquisition of real estate platform Redfin, citing potential risks to competition and affordability in the housing market.
In a letter sent Wednesday, lawmakers including Democratic senators Elizabeth Warren, Cory Booker, Mazie Hirono, and Tina Smith, as well as independent senator Bernie Sanders, called on the Department of Justice (DOJ) and the Federal Trade Commission (FTC) to reconsider their stance on the merger. Reuters reported that the senators expressed concern that the transaction—announced in March and scheduled for a shareholder vote the same day—could give Rocket Companies a dominant foothold across key segments of the homebuying process.
“These deals would combine the second-largest mortgage originator, the largest mortgage servicer, and the third-most-visited real estate brokerage website in the United States,” the senators noted in their letter, warning such amalgamation may “reduce choice and raise prices for American families.”
Rocket Companies, the parent of Rocket Mortgage, aims to acquire Redfin in an all-stock deal. The company also plans a separate $9.4 billion acquisition of Mr. Cooper Group, a major mortgage servicing firm, which has drawn additional scrutiny from lawmakers.
The senators warned that the combined influence of Rocket, Redfin, and Mr. Cooper could distort the housing market. They said Rocket could potentially steer Redfin users toward its affiliated services and use proprietary consumer data to raise mortgage rates.
While DOJ antitrust chief Gail Slater and FTC chairman Andrew Ferguson have previously stated they will not obstruct lawful mergers, they have pledged to assess deals for possible harm to consumers and workers. Slater has described this approach as “America First antitrust,” prioritizing domestic competition and market fairness.
The merger comes amid persistently high home prices and interest rates. According to recent market data, average home prices are more than 50% higher than pre-pandemic levels in 2019. Last week, the average 30-year fixed mortgage rate stood at 6.89%, driven in part by congressional debate over a major tax and spending package.
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