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GOOD and BAD about NAR: Can we fix NAR?

Reading Instructions: If you are a NAR member, please take your “NAR hat” off and read this post as an individual. This post does not intend to offend anyone. Many of you feel strongly on this subject on either side of the issue and I certainly respect it. I will tell you when it is time to put your NAR hat back.

Recently the he U.S. District Court in Chicago allowed the Department of Justice (DOJ) suit against NAR to proceed. The key point – DOJ alleges that NAR discriminates against brokers using non-traditional business models, “denying them the full benefits of MLS participation”. If you don’t know details click on the link above to read about. I will get back to this suit later on.

There are many good things NAR did and is doing for realtors and clients, such as improving agents training and knowledge, enforcing minimum transaction standards, and the most important from my point of view – the code of ethics. Some of you will say that the most important role of NAR is to protect Realtor needs and that they act as our union. The problem with protecting realtors is that by doing that NAR crossed at certain point a very important line. It did it when it started protecting our own interest more than the interest of customers we are supposed to serve. By doing it, we hurt not only our customers but we hurt ourselves as well. Once you reduce or weaken your competition, you eliminated a key factor of making progress. And this happened to us, realtors.

In my personal opinion, NAR and MLS actions stifled competition and progress and delayed real estate entry to the information age by 10-15 years. We did it not because we are bad people (after all, most of us are NAR members), but we thought that it is a best way to protect our business. Unfortunately, it is the worst way, because if you limit the competition, you shoot yourself in a foot by eliminating key driver of your own progress. Without competition you stagnate. You might full yourself that you do it because you are the expert, so you know the best. One of the symptoms “of loosing objectivity” is believing that you are the best when there are clear signs that this might not be the case any more. Let me give you an example.

Someone recently has mentioned www.realtor.org website as an example of NAR innovation. I would compare this website to a website created by a communist government of Vietnam teaching farmers how to grow rice. If it existed (it might, but I didn’t bother to check) it would closely resemble NAR website. It would have dry, 50 years old, carefully processed by bureaucrats and lawyers content. Sorry for a little bit of exaggeration, but I needed to make a point.

NAR owes us - REALTORS a lot, as it is the key contributor to creation of a growing public perception of us being unsophisticated and greedy bunch. The key question I am raising is: Can NAR be reformed and start representing the best interest of clients and Realtors? A few years ago, I would probably say no as graveyards are full of failed trade associations.

Fortunately for NAR and MLS, the current real estate revolution started a few years ago. You can read about it in “Who started real estate revolution?”

We are lucky that Zillow, Trulia, Red Fin are putting pressure on us. They showed that there are other ways to serve real estate clients. Of course nothing would happen if clients didn’t respond. And clients did respond. They love new services. It is not important at this moment that Zillow estimates are not accurate and the Red Fin agents might not know much about real estate. It is important to see that clients want different services than they were getting from us. It is a message which we need take very seriously to our hearts.

NAR, MLS and a few local associations noticed the competition. For the first time, NAR and MLS realized that someone else is capable of creating alternatives and clients might abandon realtors. After all this years of red tape and stagnation, NAR and MLS started to push for more changes, better technology, integrated MLS (you can find some background information in MLS in Turmoil). Do they have enough time before the history will push them to the abyss of organizations that time has passed?

There are many voices, including in our community calling for a reform of MLS for different reasons. There is one very important feature of MLS that justifies for me the need to protect and consistently refine and improve the MLS concept. MLS is giving an equal playing field. This is why small, independent brokers can compete against large brokers. We should make sure that the equal playing field extends to new brokers and new business models. If we don’t do that, real estate market place will be taken over by a few large players and the end result not only will wipe out thousands of brokers and agents, but it will reduce clients’ choices as well.

Can NAR be reformed? It has to be reformed. It is in our best interest to make sure that NAR embraces change as quickly as possible. So, put your NAR hat back on and tell me what could be done to better embrace change, including competition, and to protect clients and our best interest. We could call, for example, for introduction of NAR constitution which would promote an open discussion among the ranks, promote competition and change, as our nation founding father did over 200 hundred years ago. NAR activities should be more transparent to all of us. We should have right to openly question NAR leaders and challenge them. The fact that you as a NAR activist know what is going on doesn’t change the fact that for the rest of us NAR actions and decisions are often a mystery. Moreover, NAR leaders lost their credibility with me as their actions are hurting both, clients and members.

We can win our market share by being the best and not by creating rules to limit the competition. There is no doubt in my mind that clients, agents and brokers will be better served if we put a pressure on NAR to change.

Will DOJ win the suit against NAR? I don’t think that we should wait to find out. Let’s start cleaning our house now.

Please check also: Can We Fix NAR? Sequel Part 2

Posted by Artur Urbanski on 07/15/2007 05:50 AM

Comments (50)

nar, nar leaders, mls in turmoil, doj, change, zillow, rulia, red fin, clients, realtors

50 Comments on GOOD and BAD about NAR: Can we fix NAR?

JUL

2007

Wow! GReat post! I give you a "5". That said, I have to tell you that I disagree with the suit. I own ValueList Real Estate Services, Inc. and to the best of my knowledge, we are the 3 oldest discount real estate company in the nation. I'm sure that there are older, but I haven't found them yet.

Anyway, when I started ValueList 12 years ago we experienced some negative backlash from the agents, but not from NAR or my local MLS. I don't think that NAR should be forced to open the MLS up to the public. Protecting the value of the asset that we all, by putting our listings on the mls, own is important. It's a hell of an asset and nobody else comes close.

What NAR does need to look into changing is Realtor.com. It sucks and is unfair to NAR's members. Read Jim Lee's postings on Realtor.com and mine if you get a chance. It's ashame that NAR is letting this happen!

Bob Mitchell

ValueList Real Estate Services, Inc.

It all sounds very good Artur. However, your post asks duties of the NAR that are not it's core purpose. See: NAR's Mission and Vision

Mission
The core purpose of the NATIONAL ASSOCIATION OF REALTORS® is to help its members become more profitable and successful.

Artur,

I have been a member for about 10 years, but I never have viewed NAR or the state and local boards as anything more than a club I had to join to be in the business.

Business models (like Redfin and Zillow) have come and gone over the years, but the core tradional real estate buisness has sustained. The "market" will eventually determine the outcome and crown the winners and losers. Some will prosper and some will flounder. And then we'll move on to the next generation.

AU,

NAR is too political at this point to change.

You seem very concerned with whats happening inside of NAR.

This is your 4th post on the topic..

interesting.

From Lenn's response and link, I read NAR's Vision:

"...to become...the acknowledged leader in developing standards for efficient, effective, and ethical real estate business practices..."

I think this is in direct opposition to the DOJ's approach of championing allowing anyone to slap a listing onto the privately-owned MLS, like an "Avoid Foreclosure" sign on a light pole, without any real agency status. That creates a terribly unlevel playing field.

We have Craigslist, light pole signs, REI groups, and myriad other venues for scammers and pickpockets. NAR should tighten up on members and set us further apart in the eyes of the public from scandalous activities as much as possible to claim a high ground.

Interesting post. Though the main complaintents that the DOJ is basing their case on also are the same group of people who would like to see the Real Estate industry consolidate and see 90% of the mom and pop realtors go out of business. Then they can hire cheep people to sit in call centers and act like walmart clerks.

The other group who have their complaints which the DOJ has taken up are the discount brokers, who base their business on getting listings on adding no value other than being cheep. They don't care if they make any money on having those listings in fact they really don't want them to sell very fast. The main point in having them for the discounter is so that they can generate and steer as many buyers to purchase the listings of traditional brokers. Kind of a vulture approch to life. Not many people like a vulture.

Yes NAR Needs to change, Yes the MLS's need to get a clue, No it is not a good idea to feed the monsters who are looking to bite us. Some of the monsters who are looking to bite us are, Zillow (Very poor company to put forward to your customers) Trulia trying to basically form their own national MLS, they just will not admit it yet, Google Base, yet another company trying to setup a national MLS, again will not admit it yet. (if the DOJ takes down NAR just watch our wonderful Republican elected officials will be campaigning for laws which will put the Real Estate industry squarely in the hands of large companies like Google, Microsoft, Yahoo, ...) when that happens, it will be time to put the application in at walmart becouse those companies will make sure that most of the profit opportunities flow to them.

Like Bob, my model is unlike any other real estate brokerage model in my town. Initially, I did experience some whining from agents, but my local association and the MLS has been nothing but supportive.

Seems that we are willing to "Lower the Bar" rather than 'Raise the Bar" in your post. Certainly NAR is a Huge Beauracracy and political machine but that is a part of their purpose. When the DOJ deregulated the Securities business they did not do away with the NYSE, S&P they required NASDAQ to have licensed Brokers amployed by firms who were all members of the SEC. We need to move in that direction so we know can have $7.00 tradind on Scott Trade or traditional investing at Merril, Lynch consumer decides.

By the way Artur, do to the number of posts you make on behalf of Zillow, are you a Zillow stock holder?

This is a fabulous post. I don't completely understand the lawsuit, because it seems that to list or sell real estate you need a license from whatever state you do business in. And isn't that the only requirement for NAR membership? If NAR prohibits non-traditional licensed sales people and brokers joining the organization, it seems that would be bad. But if they do allow them in, which I think is the case, does that not give them full access to MLS?

As far as non-traditional firms offering an "inferior" quality of service, I think that price/quality options are here to stay, and those of us who claim to be full service agents will have to provide just that. I think regulations should cover disclosure of what is or is not being offered to the consumer.

Bob, Thank you. I really appreciate your comments. I hope that the suit fails as well. What we are dealing with often are perceptions. I don't believe that suit would happened if perception ogf NAR wrong doing was not out there.

Lenn, that's exactly my POINT. Let's amend the NAR mission statement and include clients interest as well. That's the problem of all unions and trade associations. They think just about themselves.

Hi Fred, thank you for your reply. You are absolutely right. For years there was a status quo. I don’t think that it will stay this way, however. We are a part of a huge market. A lot of money is in stake. NAR by being conformant and by protecting this status quo for years, made it and realtors vulnerable. There is a lot of innovation going on to change the status quo. I don’t think anything can stop it (this is why I called it a real estate revolution). The best thing as NAR members we could do would be to change the status quo to a system that can be orderly maintained and make itself vulnerable. The point I am making is that the “market has spoken”. Clients told us by their overwhelmingly positive reply to new market players, that they are RECEPTIVE to changes. The change can benefit NAR and realtors only if we become part of it. NAR can certainly do a better job representing us and doing what is right for us. To do that we need to accept that clients need should drive the process, not just do things that benefits realtors. Have you seen a reply from Lenn? I believe that we need to change NAR’s mission and make sure that whatever we do is driven by clients needs.

Scott, yes I am very interested in NAR activities to become more transparent to members. I believe that the reason for NAR's current legal problems is that NAR became too decoupled from its membership. I don’t know how old are NAR’s mission and vision statements, but they need revision. Thank you for your reply.

Mike, I really appreciate your input. All the good things NAR does should be protected. We might loose years of progress and accomplishment in improving quality of customer care if NAR losses its legal battle(s). To protect all the great contributions of realtors over the years we have to press NAR’s leadership to accept the inevitable change and do not what was good 20, 50 or 60 years ago, but what will protect our business in the future. Whatever we do as realtors cannot be decoupled from the interest of our clients.

James, thank you for your excellent comments. There are a lot of voices out there and you always have to check who is saying what to understand real motivation behind. I think that we need to protect the interest of small brokers and agents as they bring the majority of expertise and knowledge and this is what gives clients choices. So, we (small brokers and agents) need to be careful not to get caught in a rhetoric that might hurt our business and our clients (by giving them less choice). NAR claims that it represents our interest. I simply do not believe it. NAR represents interest of those who have more pull and influence, not an interest of an average agent or broker. We need NAR activities to become more transparent – for us to be able to direct it and control it.

Todd, NAR is not a monolithic, uniformly bad organization, after all a lot of us become involved with local associations and down the road, with NAR. I believe that associations and NAR have a huge record of accomplishments. The problem is that we conform to the system and rules set up many years ago and what served the purpose before not necessarily fulfills the role today. We have tendency to go trough the motions and follow the system and that’s good. However, every now and then, we need to update the system and its rules. If we set up the NAR constitution (charter) right it should be able to self improve itself as time goes. One of new rules could be “do what is right for the client first. If its good clients- it will be good for business".

Paul, thank you very much for your input. We definitely should not lower the bar. There is a lot that can be done and a lot of people would like to control our industry. Control of NAR is a way to do that. We have just to make sure that whatever NAR does is good long-term for the business. I happened to believe that you cannot decouple the well being of clients from the well being of the business – at least in real estate.

Not, I am not a stock holder of a friend of anyone in Zillow. I am entrepreneur for many years, so I enjoy seeing a success. There a lot of luck, good timing (that’s partially luck), but also a lot good thinking (in my opinion) behind Zillow. Will they succeed? They are well position, but it is anyone’s guess. Personally, I don’t believe that within next 10 year any organization that will try to bypass agents and small brokers will succeed. Agents and brokers are the core strength of this business. Without their cooperation, you will not have a successful real estate business, at least now and in the near future.

Patricia, thank you for your comments. MLS was and still is in a, too a large extent, monopoly position regarding the listings. NAR and MLS could come up with just about any rules to protect brokers’ property, as they were the only game in time. Trulia and Zillow made them realize that there might be other listings options in the near future.

Regarding non-traditional offerings, I agree – they are here to stay. I we want higher commissions – we have to earn them.

I wonder if the DOJ would be filing suit if the NAR was more selective (i.e. more than the skills it takes to write a check) and had fewer but better qualified members like that of an elite association and not a rubber stamp club?

Daniel, this is a good question. I think that the quality of agents has more to do with Dapartment of Real Estate. DRE has to deal with clients unhappy with the service. I believe that DOJ is more concern with an equal oppurtunity, or rather lack od such according to them. Thank you for your comment.

JUL

2007

Excellent debate! As I mentioned in my comment above and in postings here on AR, I don't think that NAR truly has the best interests of it's members at heart. As an example of this I pointed out the situation with Realtor.com.

**********************Please Think About This For A Second**********************

If NAR is a member based organization, should it's "official web site" allow one member special access and benefits over another so that the company that operates the site can make exordinary amounts of money off of the Realtors?

Not to get to long winded here, but if you don't purchase the enhanced listings package from Move, Inc., you can't have a link from the largest real estate web site (one owned in part by you!) to your site. If you don't purchase the enhanced listings package (which for my little company would cost me over $3,000.00 a year) the public can not find out any information about your unless they already know your name and then go through a fairly complex search procedure to find you. It's not right!

I emailed Ms. Combs (NAR's current president) about this issue several times and never heard back from her. Not so much as a "fxck off you pion" email. I did hear back from the incoming president who referred me to a Mr. Stein who basically gave me a boiler plate defense of NARS relationship with Move, Inc.. When I challenged several of the points that he made as being inaccurate, I never heard back from him. This was even after I called and left a voice mail and left several emails.

NAR's monopoly on the data that we provide needs to be protected, but NAR needs to get a clue! They can start by cleaning up their incestuous relationship with Move, Inc.!

Bob Mitchell

ValueList Real Estate Services, Inc.

Wow! what a post!

This is great. Our local board gives members no input. They have elections where the present officers provide a slate for thumbs up or thumbs down vote. Nominees from the floor must have been to the board sponsored leadership training and be present at the election, usually half the rubber stamp self appointed slate are absent. I have had questions about the local board operations and emailed the officers I received two out of 30 or so responses and an angry call from the paid administrator of the board informing me that to ask questions I needed to submit them to her in writing and notify her of my desire to ask the board members at their regular meeting at least two weeks prior to the meeting. The next meeting was in 13 days and they were taking two months off for the summer. BTW these are the folks who make the decisions on state and national officers.

As far as I am concerned I do not understand why I get fined at the local levil for putting my contact information in the comments section but have to pay to add it back at the state and national level.

I am particularly concerned that the leadership acts like a bunch of self serving self appointed inbreds and does not look out for the consumer, but rather focuses on defending its 100 year old business model. Just look at how NAR responded to the 60 minutes piece. 60 minutes mentions the "sacrosanct 6% commission" and NAR responds by arguing percentage - I don't care if the average is 7%, 6% or only 5.2% the issue was not 6% but the commission and business model that NAR embraces. They argued numbers instead of addressing the irrefutable point, NAR is not interested in recognizing other business models. It is easier to blame 60 minutes and attack Redfin than to do the right thing. What a bunch of babies.

I hope you keep this debate going with similar posts!!!!!!

Bob, I agree with everything you say. Good, hard working realtors, who become "privileged" by serving on NAR (the Big Brother of Real Estate), change their personality. They become a part of “the organization”. They forget who they were and whose interest they should serve. “The organization” knows better. It might not be possible to change, but is worth a try. It is not different for us displaying a different personality once we ware at home with our families, from that in the work place.

Dan, excellent comment. This is very unfortunate, but also very typical for union/trade association type of the behavior. It usually is incurable as there is no individual logic there, but only group logic, so it is almost impossible for individuals within organization to fix it. If anyone tries to do so - they become villains, as they try to change existing rules. Rules are more important that logic and reasoning. The only hope is for agents and brokers to put more pressure on NAR from the outside of “the inner circle”. It might be dangerous, because once “you unleash a revolution”, you might be not be able to control it. I would want NAR to stay around, as it has a lot to offer, but it has to become accountable to its membership. Thanks again for your comments.

I'm either naive or very fortunate, because it seems to me that our Local and State Associations are doing a great job for Realtors AND consumers in Anne Arundel County, MD. I have to assume that their leadership is coming from NAR, so it can't be all bad. That being said, I do agree that they wore blinders for many years, obstructing progress by blocking buyer-brokers' access to the MLS, and man other policies.

I agree with Lenn that NAR could use "fixing" - that we, as an organization, should have a stated purpose that includes promoting the highest level of professional service and representation to consumers.

Hi Margaret, thank you for your comment. There many, many good realtors and there good associations. You mentioned that "I have to assume that their leadership is coming from NAR, so it can't be all bad". Unfortunately, it looks more as Dan Homan described above: "I am particularly concerned that the leadership acts like a bunch of self serving self appointed inbreds and does not look out for the consumer, but rather focuses on defending its 100 year old business model". I believe that we have to include customer interest in the NAR mission statement.

Regarding Lenn's statement, she wrote:

"It all sounds very good Artur. However, your post asks duties of the NAR that are not it's core purpose. See: NAR's Mission and Vision
Mission
The core purpose of the NATIONAL ASSOCIATION OF REALTORS® is to help its members become more profitable and successful. "

Based on this I don't think Lenn sees the need to change anything. I have a lot respect for Lenn (I love her Virginia post!), but you cannot continue supporting an old charter, just because “it is there”. It certainly was not written in stone!

JUL

2007

"The core purpose of the NATIONAL ASSOCIATION OF REALTORS® is to help its members become more profitable and successful. "

NAR's core purpose is in being the largest lobby in the US. What they do as watchdogs for homeowners is frequently overlooked and under-appreciated by its membership.

Hi, I understand the mission and I worry that the way it is formulated might become a reason for the NAR "undoing". Being the largest lobby doesn’t say anything about home owners or home ownership. Protecting the business might become a very heavy handed, and protect rights of a few within the lobbyist organization and not necessarily clients. NAR would have much easier job of defending itself, if it could say I do what is best for my business and this includes clients, agents and brokers. Instead, it got tangled in trying to prove that one business model is more righteous than another.

Artur, you asked me to comment so here I am.

"NAR owes us - REALTORS a lot"
I am not a member of the NAR, but that statement confuses me. As far as I know Realtors® ARE the NAR. Yes there is a bureaucracy that administers and runs the organization. But as Realtor® I would take It as my organisation. Any change that needed to be made would be my responsibility as a Realtor®.

I agree that part of helping real estate sales people is helping them become a better resource to their clients. I see many examples of the NAR doing this. The NAR has a lot of educational resources available to realtors. Did it cross a line? I don't know but if that line is crossed believe it hurts everyone.

Actually I can think of an example. NAR economists announce all sorts of predictions about the markets. The predictions are predominantly (at least the ones I've seen lately) way off. It seems clear to me that these are spin campaigns, obvious ones.

The problem I have is that these announcements and predictions, being inaccurate spin, ARE representing the NAR membership. By allowing these biased predictions to continue, Realtors® are being given a bad name. Honesty is more important in sales than "bending the truth" to make a buck.

"Can we fix NAR?" yes of course as your organization you can fix it. I wouldn't see the NAR as an organization devoted to innovation as you suggest. The NAR's role in new technologies in my opinion is more to help members adopt innovations and maximize their utility. This is of course after the innovations have somewhat matured.

I see Zillow and Trulia as tools for agents more than they are "putting on the pressure." But that's just me maybe?

I wouldn't have included RF in the list. There are thousands of individuals and brokers with "alternative models." The company originated here in Washington State. I've seen the company go through a number of business models. There's nothing special or unique about their models. They're just selling a little real estate like anyone else. They do a fabulous job however of communicating a marketing message. It's worked really well. The bloodhound blog had a good post on this today.

I have to say that The ActiveRain Real Estate Network is "openly questioned" all over the place, and I for one appreciate it. I would think that the organization that is The NAR does as well. Asking questions gets us somewhere new and better.

I'm confused. Perhaps I'm sheltered, too.

Here in Atlanta, GA we have two different MLS options. GMLS and FMLS. Neither of these are owned by the NAR, or the local board. Companies with agents that are not members of the NAR/GAR/local association are able to access both MLSs. So, where is the constraint of trade?

One can be a state licensed real estate agent without being a REALTOR. One can work for a company that isn't a NAR member. They can have access to the MLS without being a REALTOR.

Maybe it's different out west. Are you guys just behind ;)

But, seriously, I wonder about the DoJ case because the issues that they raise don't seem to exist here.

Now, is the NAR delivering what its members need? I don't know. I see a world where 80% of those that get licensed are gone at the end of a year. And, further, 80% of those that make it through the first year are gone in the next four. I see a low barrier to entry that certainly doesn't protect members from competition. I see state real estate commissions controlling the licensing of agents (as opposed the the American Bar Association controlling licensing in the legal profession).

Again, maybe I'm just in a market that isn't normal. Maybe I'm sheltered.

Caleb, thank you for the comments. You made a number of excellent points. However, I totally missed my main point I totally missed my point. NAR is a typical example of the organization that cannot change on its own. Why? It lost the ability to change and evolve.

Let me explain it how it works. Yes, Realtors are NAR members. One would think that NAR represents the will of an average realtor. However, it is not how it works in the centrally controlled organization. Using the old communist (yes NAR belong to the same category – it is a centrally run, union or party like organization) party jargon, there is “cadre” or “elite” and there are “masses”, or everyone else. Let me go through an example to illustrate how it works. Let’s assume for the purpose of this example that you are a NAR member. You noticed that your organization needs to change. You might think: “I will work very hard, I become elected to the “NAR central” and I will promote changes”. So you got elected and try to “shake up an organization”. Before you can finish your first sentence, someone will show you “the book of rules” and tell you: you were elected to defend these rules. If you persist, the central will put a pressure on you and will “chew you up”. You have to choice, either to leave and to five up. There benefits of “seeing a greater message”. You might become a proud member of the central and you will carry their message forward. It is much easier! Do I exaggerate? Unfortunately, I don’t.

Unless a mechanism is put in place in place (such as an American Constitution) that allows a n organization to change and adapt, nothing sort of a “revolution” can be done to change the organization’ thinking.

My point is that only the competition from an outside can force NAR-like organizations to change. We are lucky as “the revolution” has already started. It is important that the “masses” of agents and broker realize that it is time to put a pressure on the NAR elite to embrace the change. If we don’t, DOJ might do it for us and consequences of this might be disastrous to our industry and clients.

By the way, I was shown today a book of rules of AR (yes, Active Rain). I was scolded for not understanding how the “feature posts” system works and disturbing an AR member’s hard work to enforce them. My jokes are usually not very good, but I cannot resist trying one. AR is on the way to becoming a part of NAR. It misses only N in front! Yes, I know. It is not funny. But this is why I am trying to prompt you to publish featured posts guidelines. You created a great system – make sure it does not run away from you and becomes uncontrollable.

Thank you for a link to the today’s bloodhound post and thank you again for taking the time to comment. I really appreciate it.

Lane, thank you for your very good comments. From what you are saying it seems to me is that GA system is not much different from what we have in the West. Yes, you can have a license, but you to become Realtor ™, you have to become a part of local association, a member of NAR. NAR and associations are doing a lot of good things. At the same time they are shooting themselves in a foot and try totally unnecessarily prohibit some business models. You are right - there is a plenty of competition, so don’t try to stop it, because you will hurt yourself and those who supposedly you try to protect – all of us. So one really have to wonder, what are they smoking?

This is why I came to ActiveRain. Great post.

Artur, I hope that you don't mind me jumping in to address Caleb's comment. If so, please feel free to delete this comment.

Caleb: A few months ago, right after joining AR as a matter of fact, I was working on my web site and from AR had found out that it is important to have bigger web sites linking to your site in terms of SEO. I decided to make sure that I had a link on my associations official web site, Realtor.com. Turns out that I didn't and couldn't unless I was willing to pay over $3,000.00.

I thought that this was wrong, so I contacted NAR through their 800 number and basically ran into a bureaucratic roadblock. I then emailed the current president of NAR, who never even acknowledged my email. I didn't even get an automated replay.

I did however get a reply from the president elect who passed me on to the gentleman who is the liaison between NAR and Move, Inc.. This gentleman sent me a boiler plate response that was frankly, nothing more than propaganda. I wrote him back challenging certain points and never heard back from him. I followed up via email 2 additional times asking what the procedure would be to bring this matter before the board of directors for consideration. I then called and left him a voice mail, which was never returned.

Yesterday, I talked with the executive vice president of my local board who is one of over 600 "directors" and asked him what the procedure would be. He told me that I should run for a local director's position and work my way up through the organization in order to get into a position of being able to change it from within.

I asked him how long it had taken him to become one of these 600+ directors....the answer? Over 20 years.

Hmmm, I'm 46 now.......see what I mean? Not that NAR doesn't do some pretty good stuff. They do, but they definately aren't interested in any kind of input from the masses and in relationship to it's relationship with Move, Inc., I believe that they have strayed for enough from their core mission to be in violation of it.

Just my two cents worth here.

Bob Mitchell

ValueList Real Estate Services, Inc.

Thank you Patsy!

Bob, wow it is almost scary! I was just imagining the situation, but of course I am not surprised... I have to say that I have unfair advantage. I was involved with this type of organizations a few times. Changing NAR is definitely a challenge! Thank you very much for sharing your opinion.

JUL

2007

Bob, can I use your last entry to a sequel on NAR? Please let me know. As a matter a lot of my education on NAR comes from a very accomplished local broker. He was a President of the local association and he was a Director on the State level. He was pushing for changes. Guess what? He got burn out. I couldn't believe how this experience was similar to what I went through in my twenties.

Hi Artur, Seems that this topic has opened up quite a few other issues. Much of your initial post is based on sweeping generalizations and cliches. If you really want to see fundamental change it might be more effective to set out some bullet pointed issues and offer some constructive solutions. That way we could focus on the basic issues and perhaps see some great input. Some have made a good case against lowering general standards and the resultant lessening of standards and levels of service to our customers.

NAR is a mix of good (the research resources) and the bad (when they support Congress people in a district whom my clients hate). So many realtors are part time business people and fulltime members of the NAR social/political club that I'm pessimistic about the possibility of change.

Bill, thank you for your excellent input. I believe that the last Bob Mitchell’s comment contrasted with previous generalizations –was very specific. Under normal circumstances, any attempt to influence NAR by a few individuals would be totally impossible. I happened to believe that it might be worthwhile to try because of the following reasons:

Ongoing DOJ law suit against NAR
New market entrants showed that bypassing realtors might no be impossible; there is growing concern shared by NAR leadership and ranks.
Growing market discontent with realtors (blocking competition and cheaper solutions, etc.)
Growing discontent among Realtors about lack/faulty leadership from NAR leaders
Emergence of blogging as a powerful tool to challenge a status quo and misinformation (an example is Dan Rather’s demise from CBS as a result of bloggers input)

So, we could start with several things, such as:

Collect more examples similar to the one by Bob Mitchell – illustrating unresponsiveness of NAR to Realtors input and leadership’s lack of understanding of the public impact of their policies.
Grow grass root support and create Realtors lobby
Outline suggested reforms to NAR including policies, mission statement, objectives, organizational structure and the way to select NAR leadership, etc.
Develop strategies of involving NAR leadership into discussion with Realtors lobby
Excerpt pressure on NAR leadership

Will it work? There is a very small chance but with changing situation and growing public and Realtors discontent there is a chance. So, possibly, it might be worth to try. Bob, if you believe we should try – let’s involve our colleagues, send this message around and see if we can get something going. What do you think?

Ann, you made an excellent and important point and let me restate it. There are many, many things NAR did and is doing very well. After all, the majority of NAR are us, hard working agents and brokers who try to excel in their service to customers. The problem is a disconnection of the NAR leadership from the market realities and their inability to modify the system to adapt to changing business landscape. To give them a credit – no one at the moment has a power to change the system as it reached a “consistency of magma hardened over the centuries” (sorry for this slight exaggeration). Unless you put the heat under the NAR leadership (a lot of it) nothing will change. If we don’t do that ourselves and DOJ do it first (puts enough heat under the NAR leadership), we might loose years of Realtors progress and accomplishments.

JUL

2007

Hi, I would like to bring your attention to an interesting post by Beth Butler "What happens if MLS goes away."

Lenn,

You are an extremely accomplished broker and blogger and you produced many high quality posts on AR. As a matter of fact, I complimented you on a great job you did on your Virginia post yesterday. While searching for different posts on NAR and MLS I found this post. To my surprise I realized that you are commenting on my post Good and Bad Things about NAR: Can We Fix NAR? Why am I surprised? I am surprised because you didn’t do it in the comments section of my post, but you prepared your own post. Additionally, you even didn’t bother to notify me about this post to give me a chance to respond. Moreover, you seriously misrepresented my position. It is very surprising from accomplished and respected broker like you.

The only comments you made on my post are as follows:

“It all sounds very good Artur. However, your post asks duties of the NAR that are not it's core purpose. See: NAR's Mission and Vision
Mission
The core purpose of the NATIONAL ASSOCIATION OF REALTORS® is to help its members become more profitable and successful.”

Subsequently, you published this rebuttal to my post without notifying me about it to give me a chance to respond. After carefully studying this post, I understand why.

Let me clarify my post and my position:

My post is not about the DOJ lawsuit against NAR. I am merely opening my post with a referral to the lawsuit. My post is about good and bad things NAR did and is doing. As a matter of fact, my post triggered a very a lively and informative discussion on this subject and I welcome you and your readers to join it.
I did not say that NAR “should change the focus from that of protecting Realtors to protecting "the interest of customers we are supposed to serve." In my reply to your above comment I said: “Let's amend the NAR mission statement and include client’s interest as well. That's the problem of all unions and trade associations. They think just about themselves.” I do not propose capitulation. I opened a discussion on how to prevent a disaster. It happened that NAR leadership misrepresents of what most of us, agents and brokers, sincerely wants. We want to do our job as well as we can. Let’s market place to decide how high commissions should be. NAR’s position is ill defined and jeopardizes years of NAR accomplishments. NAR is powerful and rich, but do you remember how powerful AT&T used to be before DOJ sued them?
Lenn, you are right – the government is not always right. But what often matters more is a public perception. And public is not favoring realtors’ position. Why? Because NAR and MLS stifled our progress for years and now, once a few start up companies demonstrated that they can satisfy different needs of clients, NAR and MLS failed to notice. All of us might dearly pay in the future for the NAR leadership’s lack of vision.

Lenn, have you noticed how MLS is rapidly changing over the period of last several month? This is a direct result of the competition from Zillow and Trulia. MLS is changing because it is scared. It is scared not of Zillow and Trulia. It is scared of enthusiastic public response to their services. This response clearly showed MLS and NAR leadership vulnerability and failure. They failed to notice that clients’ needs are changing. Couldn’t we provide services similar to those offered today by Zillow and Trulia years ago? We certainly could, but NAR chose its own interest (not ours – agents and brokers) over interest of clients and chose to suppress our creativity. This is why it is time that we “get our act together” and reform NAR before others do it for us. Please, join discussion on how we can accomplish it.

I welcome your rebuttal, but I would appreciate it even more if you have not misrepresented my position and gave me a chance to reply by informing me about it.

Artur - I am happy to see this discussion is now on 3 posts - it's a ground swell of sorts. Unfortunately, so many of us get consumed with our day to day issues that one day we look up and our world seems to have changed overnight. That is the worst position to be in from a business perspective. I think AR provides an awesome platform for these discussions in a way that NAR is lacking - I just wish we had AR 5 years ago or that NAR had opened up these discussions in this kind of format long ago. There is no dismissing the consumer movement towards information. As an industry, we have given a peek but never given full access. I can remember back when there were MLS books and there were big fines associated with giving those books away. I never understood that- forcing someone to seek you out just to get information that now can be readily found just makes us look like that is all we have to offer. Let's keep this going!

Artur: Please feel free to reference my posts or comments when ever you feel.

Beth: I haven't read your post that Artur refers to above yet, but will shortly. The MLS "monopoly" on the listings is the biggest asset that NAR and it's members have going for it. As I pointed out above and in my posts on "Realtor.com", it is this monopoly (or something close to it) that makes Realtor.com the number one real estate web site. No where else can you go and expect to get nearly as complete a list of properties that are on the market, therefore, that's where the people go.

Similarly, protecting the data that is on the MLS works to our interests. I have a friend who thinks that we should do away with yard signs because then people would be forced to call an agent to find out what was on the market! A bit extreme, but it illustrates my point.

Bob Mitchell

ValueList Real Estate Services, Inc.

Bob, thank you very much. I will publish a sequel soon to keep things going. MLS and Realtor.com are tremendous assets, no doubt about that that. Realtors have a lot to loose.

Beth,

Thank you very much for your comments. I love your statement"I never understood that- forcing someone to seek you out just to get information that now can be readily found just makes us look like that is all we have to offer. Let's keep this going!". NAR and MLS are changing, but too slow. Zillow and Trulia demonstrated to us that NAR overplayed its hand and the monopoly might be gone very soon. It is always smart to share and now things might be totally out of NAR's control.

AUG

2007

Since price fixing is a violation of the Sherman Antitrust Act and I have never considered breaking this particular law (expensive fines), I have no fear of the DOJ but do fear that the NAR is not moving with those of us who are here to stay no matter what our business model.

There are more than 42000 Active Rain members. We need to reach out and touch the NAR as a group before they do irreparable harms.

In regard to Julie's comment, I have become convinced that NAR's actions and the needs of the real estate community and it's members have become disassociated. Bob Mitchell ValueList Real Estate Services, Inc.

Julie, I certainly agree. NAR leadership can do irreparable harm. They seem to be in the state of denial and never heard about Judge Green and AT&T case. Active Rain is a great forum and good way to reach the community. Thank you for your comment.

Thank you for your comment Bob.

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