This week’s episode of The Real Word took on Howard “Hoby” Hanna’s argument that the real estate industry should set up a two-tier system for Realtors.
In Hanna’s view, the Realtor title should be earned, not bought.
Agents had thoughts, which they shared in the YouTube comments, as well as on an Instagram carousel with a clip from the episode.
Opinions run the full spectrum from “Nope” to “Nobody cares” to “Agree 100%.”
Byron Lazine and Nicole White broke down Hanna’s argument and explored how a two-tier system for Realtors would impact agents and consumer perception of the Realtor brand.
Read on for the highlights (with a generous sampling of comments). Then tune in to enjoy the full conversation.
What Hanna Proposed & How Agents Reacted on YouTube
More than 1.4 million licensed real estate agents are competing for business nationwide.
According to the Consumer Federation of America (CFA), 49% of agents closed zero or one home sale in 2023. 70% sold fewer than five homes.
The current path to the Realtor title:
- Get licensed
- Pay National Association of Realtors dues
- Call yourself a Realtor
No transaction history required.
Hanna, CEO of Howard Hanna Real Estate Services, wants that to change. In an interview with the Pittsburgh Post-Gazette, he pointed to the difference between a brand new agent and a veteran with years of production behind them.
“There’s no success metrics that have to be under your belt to be called a Realtor. So, what’s the difference between a brand new licensed salesperson versus a veteran that’s been in the business seven years, that’s sold $30 million worth of real estate in their career?”
His fix is a two-tier system.
- Tier one keeps the Realtor title, reserved for agents who have hit a bar of three years licensed plus a minimum number of completed transactions.
- Tier two covers agents with a new license. They would work under a sponsoring or mentoring broker, with the broker signing off on their work, until they have shown they can produce.
Hanna also wants the dues structure flipped. Established Realtors would pay less. Newcomers would pay more, since they’re the ones asking the industry to invest time and mentorship in them before they’ve proven anything.
Of course, that immediately begs the question of whether NAR would ensure newcomers had access to the mentorship they needed in exchange for those higher dues.
Hanna has his own theory as to why NAR hasn’t already implemented a two-tier structure like the one he’s proposing:
“The National Association of Realtors, they don’t care really, truly, in my mind, about the profession. They care about how many people are paying dues.”
Byron and Nicole dug into what a change like this would mean for agents. Byron pointed out that raising the bar to use the title lines up with what separates strong producers from everyone else.
“I think anything that in this business creates track record, having to do deals, earning it, learning the business, it’s why teams are kicking everybody’s butt is a good thing.”
Byron framed Hanna’s proposal as a specific plan for NAR to consider (and possibly implement):
“He’s actually giving them a playbook to do what they haven’t been able to accomplish and what they’re so passionate about doing, which is creating value behind the name and the trademarked use of Realtor.”
Nicole raised a practical problem. Agents who do not want to be labeled a newcomer or an apprentice might skip NAR membership instead of accepting the lower tier (with the higher membership cost), the opposite of what the association would want.
She asked the enforcement question a lot of agents are asking.
“What makes anyone think a two-tier system doesn’t just become another line item nobody checks?”
Byron’s answer landed on the states, not NAR, since license law and what agents can put in a bio or email signature is regulated state by state.
The comments underneath the episode covered a range of reactions:
- Agreement with raising the bar
- Skepticism about whether NAR would enforce it
- Agents who said the title does not move the needle with clients
That last comment is one plenty of agents have voiced for some time now: raise the bar to getting a real estate license at the state level, and leave NAR to do its own thing with the Realtor brand.
Agents Reacted to the Instagram Carousel
BAM and Byron Lazine posted a carousel on Instagram with a clip from the episode, and the comment section took off.
View this post on Instagram
The post has pulled in over 100 comments and counting.
The reaction split in much the same way it did on YouTube. Some agents backed the three-year bar, arguing it’s overdue. Others said clients don’t check for a Realtor designation before hiring someone, so the whole debate misses what’s really driving business.
Here’s a sampling of their comments:
NAR may or may not adopt a two-tier system, and there’s more than one reason why they’re likely to shrug and focus on protecting the Realtor title in other ways.
Meanwhile, regardless of what NAR does, Byron made the point that strong real estate teams already run on a higher standard:
- Track record
- Transaction count
- A mentor checking your work before you’re on your own
Here’s how he put it:
“This is why teams already have all this figured out. The industry, NAR, you did a poor job of creating a standard at which agents are going to operate… But teams have already figured this out. The real estate teams have already set standards in their business on if you want leads, you want appointments, you want introductions to customer, here’s the things that need to be done to receive those benefits.
“So, there are already standards at which a team agent needs to adhere to and they’re doing it through a lot of times a systemized mentorship.”
So, here’s the real question the episode leaves you with: should NAR adopt Hanna’s two-tier system and three-year bar, or is the industry better off staying the way it is?
Where do you weigh in on this? Head on over to Instagram to share your thoughts.
