The National Association of Realtors® (NAR) may be losing its grip on the very people it depends on for its continued existence.
Between sexual abuse allegations, the Sitzer/Burnett verdict, and the growing number of commission lawsuits, NAR so far has nothing but words to back up its claim that it will (somehow) overcome its current challenges.
And the industry is wondering what comes next.
Never mind that the damages from the Sitzer/Burnett verdict amount to over $5 billion, which is more than NAR has in its coffers.
Michael Ketchmark, the plaintiffs’ lead attorney, has made it clear he intends to “topple” NAR completely. The Gibson lawsuit he filed after the Sitzer/Burnett verdict claims a jaw-dropping $200 billion in damages.
Industry analysts are now saying it’s unlikely that NAR will survive. Randy Airst, the chief executive of Exceedant, the real estate data analysis firm, spoke on what it would take for NAR to come out of this financially intact:
There are so many gauntlets that N.A.R. would have to run through—and win every time.
The first gauntlet is coming up with billions of dollars for appeals. And as Mr. Airst bluntly put it, “The money is not there.”
And now, a New York Times article by Debra Kamin has brought together a letter from the NAR Accountability Project and other notable voices in the industry clamoring for a new association for real estate professionals.
Read on for the highlights.
NAR Accountability Project email
Jason Haber, Compass agent and the founder of the NAR Accountability Project, has already been seeking out funding for an organization that will replace NAR as the primary nationwide advocate for real estate professionals.
After reviewing the impact the NAR Accountability Project has had this year (including making progress toward new leadership and HR policy changes at NAR), a recent email spells out the Project’s aims for 2024. Below is part of the email.
…Many have inquired about the future of the NAR Accountability Project and our ongoing efforts to transform the real estate industry.
Today, we provided a glimpse of what may unfold in The New York Times.
Please take a moment to read the article, which you have access to even if you don’t have a NYT subscription.
As you can see, we are now exploring -though not yet committed to- launching a new national trade association to represent agents in a dynamic and powerful way.
This idea remains exploratory, meaning all ideas and suggestions are welcome.
We are not deciding anything without your input. Our commitments to you remain the same as they did on day one: We are committed to transparency, and to listening to your voices.
If you have suggestions on how a new trade association could function, ideas on how it could benefit our industry and agents, or thoughts on what is needed now to restore trust with the consumer, we are all ears.
There are two ways to contact us:
Join us on Facebook: NAR Accountability Facebook Group
Or email us: firstname.lastname@example.org
All comments are welcome.
Thank you once again for being on this transformative journey with us. 2024 promises to be an exceptionally exciting year ahead.
NAR Accountability Project
Other voices in support of a new association for real estate professionals
Many industry professionals have spoken up to share their disappointment with NAR on multiple counts, with some of them adding to the push for a new organization to represent real estate agents.
After all, between NAR’s handling of the sexual harassment scandal and its anemic defense during the Sitzer/Burnett trial, it’s fair to ask whether NAR is still capable of being the advocate real estate professionals need right now.
Like Haber, Umansky has also said he’s laying the groundwork to start an alternative association for real estate professionals. He and Haber have both said they’ve talked to each other about it and are open to collaborating on NAR’s replacement.
They’re making decisions to protect themselves and the multiple listings services. They worry more about that than protecting the Realtors.
Nebraska Realtor Robin Philips has been a NAR member for 22 years. Like others, she asks why NAR put up such a weak defense in court for Sitzer/Burnett, and she worries she’ll lose income if commission rules are changed.
I feel like we were really let down in these lawsuits. We pay a lot of money to be defended, and I don’t believe we were.
Most agents I talk to say if they had the choice to not be a member, they would choose not to. The sexual harassment allegations feel like the straw that broke the camel’s back, and a lot of people are now saying, ‘This is just insane’ …N.A.R. has done a horrible job of telling us what they do for us.
These voices are not outliers.
Some key findings include:
- When asked “How do you value your NAR membership?” respondents gave an average score of 3.75 on a scale of 1-10 (with 1 being “not valuable at all” and 10 being “extremely valuable”).
- The vast majority (85.98%) of real estate agents joined NAR because they were required to, either for MLS/lockbox access or brokerage requirements.
- 71.7% of respondents stated they would “probably or “definitely” cancel their NAR memberships if they could still have access to MLS/lockbox.
And, when asked, “What membership benefit(s) would entice you to reconsider your decision to remain a member?” the most common response was:
That, in itself, speaks volumes.
Stay tuned as we learn more about NAR’s fate in the new year.