Who Exactly is the National Association of Realtors (NAR)?
The NAR has been in the news frequently over the past couple of years, and it has often been in the context of controversial subjects. But just who is the NAR, and why should you care?
Key Takeaways
- The NAR is the largest trade organization in the U.S.
- The NAR holds its member agents and brokers accountable.
- The NAR has fought for property rights for over 100 years.
I know many of you are used to me publishing relevant real-estate-market information and talking about the intricacies of homebuying and selling. Today, I thought I'd take a diversion and talk a little about the National Association of Realtors (NAR). You've probably heard of the NAR, but I'm betting - based on numerous conversations I've had recently - that you don't really know who they are or what they do.
Believe it or not, the NAR has impacted you if you have bought or sold a home in the last 100+ years. Even if you've bought and sold by-owner, the NAR's policies and market influence have affected you too.
Who is NAR?
The NAR is the largest trade association in the United States. Approximately 1.4 million real estate agents and brokers belong to the NAR. While it's possible for an agent or broker to do business outside the confines of the NAR, it's highly unlikely you've ever encountered a non-NAR real estate agent or broker in the residential real estate space. If you've used an agent to buy or sell a home, chances are they are a member of NAR. In fact, an agent cannot call themselves a "Realtor" unless they are a member.
To be clear, the NAR does not license agents. Licensing is handled by state agencies such as the Texas Real Estate Commission (TREC). Instead, NAR represents agents for the purpose of helping their businesses be more profitable. Their mission, according to their website, is to "empower REALTORS® as they preserve, protect and advance the right to real property for all."
What Does NAR Do?
The NAR does many things to promote its members and their businesses. First, they publish a Code of Ethics that all members are required to abide by. Most are common sense - treat fellow agents and clients with respect, return calls and messages in a timely manner, lock and secure properties when finished showing them, etc. If agents break one of the ethics, NAR can fine them and even take away their membership.
As a consumer, how does this affect you? The NAR ostensibly tries to protect the consumer by making sure agents are all playing honest and fair. They also have powerful lobbyists in Washington that seek to protect and enhance property rights. For example, the NAR and its member associations have successfully lobbied in the past against higher property taxes (at the state level). They have also lobbied against lowering the tax-threshold when you sell your home.
NAR Controveries
While the NAR has done a lot of good, not everyone believes they are acting in the best interest of the consumer. For example, last year the NAR settled a lawsuit in which they were accused on conspiring to keep agent commissions higher than they should be. Consequently, the lawsuit argued that the NAR was costing homesellers more than they should be paying when selling their homes.
At this point, I don't want to get into the weeds of all the lawsuits that the NAR has been involved with over the past few years. Suffice it to say that the real estate market is changing, and it appears that the NAR is losing some of its luster and some of its power.
Conclusion
My purpose in writing this post is to help you understand who the NAR is at a high level. As a member of the NAR, I find myself sometimes conflicted. The NAR has done much good for all of us, but I also recognize that some of their policies and procedures - while most likely helpful at one point - are not necessarily helping the general public today. As with any organization, it needs to evolve to stay relevant.
As a Realtor myself, my objective is always to help you first and foremost. I want what is best for you as my buyer or seller, and I will always do everything in my power to get you what you are looking for in any transaction. Sometimes - often times - that means working to secure the best financial position for you in the transaction. But sometimes there are other more important factors. Whatever they are, I always want to help you achieve them.
I may write another post or two that goes into more details about the NAR lawsuit(s) that have been in the news lately. But for now, just know that whatever happens, if and when you choose to work with me as your agent, I will be completely honest with you about how I get paid, what your options are, and how to best go about realizing your goals! And also realize that for all the negativity about the NAR in the news, they have done lots of good for consumers as well as agents and brokers.