NAR rejects proposal to disclose Realtor knowledge gaps
Nearly an hour was spent debating the idea, with some calling it an “ethical duty” as others said it would “create ‘ahas’ or ‘gotchas’” in NAR’s Code of Ethics.
Key points:
- An ethics proposal that would have required Realtors to tell their clients about any relevant knowledge gaps prompted significant discussion at NAR’s midyear meetings but ultimately failed to advance.
- But another proposal adjusting when Realtors must make a request for compensation when working with a seller of an unlisted property was overwhelmingly.
- NAR currently has 1,439,163 members — but the trade association is only budgeting for 1.2 million, with drops expected amid “continued market uncertainty and external pressure on membership.”
WASHINGTON, D.C. — An attempt to require Realtors to tell clients if they lack knowledge about a particular property type or geographic area failed at the National Association of Realtors' board meeting, which took place Thursday as the trade association's annual midyear meetings wound to an end.
The board, which has more than 1,000 directors, also approved a budget predicting NAR membership would drop to 1.2 million and decided to keep annual dues at $156 per member.
Ethics proposal defeated after debate
NAR's Professional Standards Committee proposed adding a new standard of practice to the Realtor Code of Ethics that would require Realtors to "disclose to their clients if they do not possess the knowledge, information, or skills about a property type or geographical area to protect and promote the interests of their clients considering the complexity and particularities of the transaction." The committee spent two years crafting the proposal.
B.J. Harris, the committee's chair, said the rationale was to "reinforce" the "ethical duty to protect and promote the interests of clients," adding that this is "something we all should be doing anyway."
Todd Beckstrom, a director and the committee's immediate past chair, spoke in favor of the proposal as a way to increase professionalism in the industry. But others thought it was too vague on when and how the disclosure would be required, with new agents particularly at a disadvantage.
"We do not need to create 'ahas' or 'gotchas' in the Code of Ethics," a director from Florida said. "The moment that we disclose [that lack of knowledge] you've lost that trust with the consumer for the rest of your relationship with them."
NAR's Executive Committee spent nearly an hour debating the proposal on June 17 before voting to refer it back to committee, 2026 NAR President Kevin Brown said. It was the only proposal to prompt substantial discussion.
Navigating a 'post-settlement environment'
But another recommended Code of Ethics change was overwhelmingly approved. Previously, Realtors were required to make any request for compensation from a seller of an unlisted property "at first contact." Now, such a request must be made "no later than the time of presenting an offer."
The Professional Standards Committee referred to the "post-settlement environment" in its rationale for the proposal, noting that it aims to ensure "that a potential buyer's negotiating position is not compromised by a premature request for compensation at a Realtor's first contact with an unrepresented seller."
NAR's Executive Committee recommended the proposal's approval. It passed without discussion on the floor.
NAR membership projected to drop to 1.2M
The Finance Committee's recommendation to leave annual member dues unchanged at $156 was also overwhelmingly approved. A projected membership total of 1.2 million served as the basis for dues revenue in NAR's 2027 expense budget — the same figure used for 2026. Despite that earlier projection, NAR's membership currently stands at 1,439,163 members, according to 2026 Treasurer Craig Sanford.
The latest projection "represents an appropriate expense planning baseline, reflecting a prudent decrease in response to the continued market uncertainty and external pressure on membership," according to the Finance Committee's proposal, which said a 1.2 million total "provides a realistic, balanced, and executable foundation for the 2027 budget."
The board also voted to allocate $35 of members' $45 consumer advertising campaign assessment to operations — a continuation of its strategy in the wake of the Sitzer/Burnett settlement.
'A long way to go,' but 'a great amount of ground' covered
NAR CEO Nykia Wright offered brief remarks at the meeting, thanking board members for their "time and attention as we continue to move forward with our progress" on NAR's three-year strategic plan.
She assured directors that NAR's executive team is hearing their feedback and offered thanks to "the states and locals, the ISCs [Institutes, Societies and Councils], the MLS community, and the brokerages." While "we do have a long way to go," she said, "a great amount of ground" is being covered.
Wright said board members were emailed a strategic plan progress update and said more information will be coming later this month. "Given that it's not quite the end of the second quarter, we still have a few more days to eke out a couple more successes," she said.
NAR declined to share the email Wright was referring to with Real Estate News.
"What Nykia provided during the BOD meeting was a mid-quarter strategic plan update that was shared because the board meeting took place in the middle of the quarter," an NAR spokesperson said, adding that the organization "expects to have a more comprehensive strategic plan update available" after Q2 and "will be happy to share additional information at that time."