Bulletin: NAR Has Been A Leader In The Kind Of Entitlement That Comes When There Is No Competition

An Explosive NYTimes Story Exposed The Self-Dealing Of NAR Senior Executives
American Real Estate Association Is A New Competitor To NAR’s Monopoly
Appraisal Institute Is The Perfect Comp For NAR’s Bad Behavior

The National Association Of Realtors (NAR) got another dose of bad press yesterday when their self-dealing was examined in depth by the New York Times by Debra Kamin. She has been relentless in holding them to account: (gift link) Chauffeured Cars and Broadway Tickets: Inside the National Realtors Group (on page A1). Up until recently, NAR has had no real competition and has behaved as such, lavishing gifts and wheelbarrows of money on senior executives.

I’ve been on an M/W/F publishing schedule for Housing Notes but this NY Times’ NAR story seemed too important to wait another day – hence this “Bulletin.” The NY Times NAR story has got to be brutally offensive to their membership, especially after reading further on how modest the compensation is for most sales agents in the U.S.

The American Real Estate Association Enters The Arena

I’ve known Jason Haber, the co-founder of the American Real Estate Association, for years so I thought I would reach out to see what he thought of NAR practices exposed in this NY Times story. He told me Monday evening:

“After catastrophic defeats in the court room and in the court of public opinion, NAR continues to find new ways to disappoint its members. Have they no sense of decency? Have they no respect for their membership? Today we learned that our dues paid for golf club memberships, first class airline travel, hotels, tickets to Hamilton, car payments, housing stipends, pet care, six-figure incomes for ‘volunteers’ and more. Is it any wonder the public holds agents in such low regard when our national trade group continues to embarrass us. It’s for all these reasons, and more, that we created the American Real Estate Association. It’s not time just for a change, it’s time for a transformation of our industry.”

Sales Agent Median Wages Are Modest

The outpouring of real estate agent reality shows of the past decade has created a disconnected perception of the wages earned by typical sales agents. I wrote about this back in July in a post called: World’s Worst Kept Housing Market Secret: Real Estate Reality Shows Aren’t. Yet the agents on these shows are usually top producers trying to take their careers to another level.

I found the following wage breakout of national sales agents fascinating, especially after interacting with real estate agents in Manhattan as an appraiser since 1986, one of the most expensive housing markets in the U.S.

In reality, the national industry wages for real estate sales agents are far more modest than the millions the reality stars seem to make. According to May 2023 data from the Bureau of Labor Statistics, the national median annual wage for a real estate sales agent was $64,640.

Florida has the highest concentration of sales agents per 1,000 population.

New York real estate agents make the most of all the states.

The Appraisal Institute Is The Perfect NAR Comp

Apologies for the following short rant about my appraisal industry’s largest trade group which is only about 1% of the size of NAR.

The Appraisal Institute, my industry’s largest and most dominant trade group does far less for its membership than its high membership fees warrant. AI continues to threaten members with investigations as retribution for not toeing the line to keep their self-dealing and sexual harassment settlements under wraps. I’ve chronicled their awful behavior for eight years on Appraiserville with the receipts. I mentioned last week that a female RAC member (I am a former president of the RAC) had filed a complaint of sexual harassment with the Appraisal Institute against a male FOJ who got suspended from all official duties for a few years – he even called me a few years ago very upset to tell me I was right about AI (he constantly attempted to manage me, ha). I learned recently that this formerly suspended sexual harasser set up his accuser with claims of forwarding “secret” documents to me to force his victim to appear in front of AI’s ethics board. Of course, there is a deep irony in this FOJ’s action. A few years ago the harasser approached me personally at a joint TAFAC/IAC conference in Washington, D.C. to offer me “dirt” on then-CEO JA. Now he gets to further harass his victim and AI is willing to help him by holding a sham ethics hearing. AI’s lack of ethics, corruption, and self-dealing are baked into its DNA. The question is, what will the current membership do about its leadership problem?

But I digress…

Final Thoughts

The NAR financial entitlement is a result of the absence of competition in the trade group space. After a while, the benefits of being a trade group executive who receives financial benefits morph into an entitlement that, if unchecked, expands over time and becomes an assumed right of those executives. That’s what’s happened in both NAR and AI. Be sure to read the New York Times (gift link) Chauffeured Cars and Broadway Tickets: Inside the National Realtors Group.

NAR never saw this public relations fiasco coming because they were so deeply ensconced in their silo eating steak dinners before seeing Broadway shows.

It’s never a good idea to underestimate a rabbit.