Kevin Sears, President, National Association of Realtors
Illustration by Lanette Behiry/Real Estate News

NAR president talks ‘stability’ — and dollars and cents 

During a podcast, Kevin Sears said interim CEO Nykia Wright will remain through the end of the year, and shared the financial realities behind NAR’s settlement.

April 9, 2024
4 minutes

Key points:

  • NAR’s Culture Transformation Commission “hitting their stride,” Sears said during a podcast.
  • Sears defended NAR’s commissions settlement and said the association wouldn’t have been able to post the bond to appeal.
  • “Will there be some changes in the association? We don't know yet,” Sears said in response to questions about paying the $418 million settlement.

As NAR seeks stability in the wake of its historic commissions settlement and a series of leadership shakeups, Nykia Wright will remain as the association's interim CEO through the end of the year, President Kevin Sears said in an episode of the Real Estate Insiders Unfiltered podcast.

"That will add stability for membership, for staff, for the association in that we don't have to worry about having multiple presidents recently, multiple CEOs recently," he said. "I think that, at the end of the day, is going to be a good thing for us."

In the wide-ranging interview, Sears also addressed NAR's decision to settle the commissions lawsuits — and how the organization will pay the $418 million tab.

Culture commission focusing on a 'safe and productive workplace'

Sears became president in January after a tumultuous year that included the resignations of two presidents and longtime CEO Bob Goldberg, and allegations of sexual harassment and a culture of fear among the staff.

The Culture Transformation Commission established in the wake of the harassment allegations "is really hitting their stride now," Sears told podcast hosts James Dwiggins and Keith Robinson. 

"We think that we're going to be getting some recommendations from them in the coming months. You know, they really look at that and they said, 'How can we make it so that it's a safe and productive workplace, both for staff and volunteers, and together?'"

And there is clarity about Sears' role as an elected leader: "I'm not your boss, Nykia is," he said he told NAR's 350 staff members. "But we're partners."

NAR settlement protects members, Sears says

Sears defended NAR's decision to settle the commissions lawsuit brought by sellers rather than continue to appeal the verdict. "It's a good thing for us, because if the judge approves it in roughly six months or so, then it means it's behind us," he said.

"We feel that we would have been successful on appeal to overturn the jury verdict," he added — but with a multibillion-dollar verdict hanging over their heads, Sears said settling was the right thing to do. 

"If we had to post the $5.4 billion full bond, the association wouldn't have the financial wherewithal to do that."

Moreover, the appeal "would have only protected the National Association of Realtors, not the well over a million members that we got into the settlement, not the local, state, territory associations, not the association-owned MLSs that we got protected in the settlement," Sears said.

"So during our appeal, which could have been up to two years, they still would have had to defend the copycat cases that have popped up across the country, and they would have been on their own for that."

He acknowledged that there were some "corporate carveouts," including Berkshire Hathaway and all their affiliated businesses, and 90-some brokerages that had over $2 billion in sales in 2022 not covered by the agreement. 

"All of their agents, their members are protected in our settlement," he said. "It's just a corporate entity that was carved out."

Where the settlement funds will come from

Once the judge approves the settlement, NAR will need to pay $202 million within 90 days, with annual payments of $72 million for the next four years.

"Next month, the senior leaders, finance committee representatives, we're going to be getting together with outside folks, financial experts," Sears said. "We're going to look at the finances of the association and figure out how exactly we're going to meet our financial obligation for the settlement," he said.

"Will there be some changes in the association? We don't know yet," he admitted. "Whether it be some streamlining, I mean, probably but we don't know yet. We need to get through that process. And luckily, all I can say is we do have some time because this final approval isn't for at least six months."

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