National Association of Realtors logo and NAR headquarters
Illustration by Lanette Behiry/Real Estate News

Could an alternative to NAR be coming? 

The New York Times — which has put an uncomfortable spotlight on NAR this year — suggests that member dissatisfaction could give rise to other options.

December 27, 2023
3 minutes

The National Association of Realtors has faced immense scrutiny this year, especially after a New York Times investigation highlighted allegations of sexual harassment and a "culture of fear" at NAR. The Times has now provided new details that suggest the association could be losing some of its power within the industry.

Is a new trade organization on the horizon? After summing up NAR's many challenges in 2023 — namely the sexual harassment claims and mounting commissions lawsuits following the staggering loss in the Sitzer/Burnett case in October — the Times reported on Dec. 27 that some in the industry are interested in establishing a new trade organization if NAR doesn't recover.

Jason Haber, a Compass agent who launched the NAR Accountability Project in response to the harassment allegations, told the Times that he's seeking funding to start a new organization. Mauricio Umansky, founder of The Agency and a reality television personality, also said he is looking to create a new association. In the article, Umansky said NAR is "making decisions to protect themselves and the multiple listings services," adding that the association "worr[ies] more about that than protecting the realtors."

Haber and Umansky are reportedly open to working together to build a new organization.

Could lawsuits cripple NAR? Randy Airst, an industry analyst interviewed by the Times, was pessimistic about NAR's chances of surviving financially due to the scale of monetary damages stemming from the many commissions lawsuits. 

NAR and two other defendants are looking at damages of $1.8 billion — or up to $5.4 billion — in just the one case that has gone to trial. And that suit covered a single state. More than a dozen new lawsuits, some of which are national in scope, could result in tens of billions more in damages.

Just making it past one of the first hurdles — coming up with billions of dollars for the appeals — could be difficult. "The money is not there," Airst said.

The article noted another threat to the association: the Department of Justice, which has taken a keen interest in NAR policies. Even if the many civil suits disappeared, the DOJ will likely push for significant changes to buyer agent commission practices and access to MLS data.

Will a policy change improve NAR culture? The Times article also revealed a new policy implemented by the organization's executive committee after the NAR NXT convention in November. The committee approved a lifetime ban from events for any elected officer who resigns or is removed from office.

The Times reported that the policy change came after NAR staff members voiced concerns that former president Kenny Parcell — the main target of sexual harassment allegations who resigned from his role in August — would attempt to attend the NXT event. In an email to the New York Times, Parcell, through his attorney, denied that he intended to show up at the convention.

Real Estate News has reached out to NAR to confirm this new policy.

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