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In the shortest such meeting in recent memory, the National Association of Realtors board of directors wrapped up its business in about an hour Thursday morning. The board voted to keep member dues unchanged next year and to amend NAR’s Code of Ethics, though the latter change needs another vote to become final.
No dues increase and rising membership
The NAR board approved a recommendation from the trade group’s Finance Committee to keep members’ annual dues at $156 in 2025 on the final day of NAR’s midyear conference, the Realtors Legislative Meetings, at the Walter E. Washington Convention Center in Washington, D.C.
A policy change last year allowed the committee to use the comprehensive overall Consumer Price Index — a measure of inflation — “as a guide” each year when it recommends an annual dues amount to the board of directors. At the time, the committee proposed that dues rise 4 percent with CPI each year from 2025 to 2027.
Inman has asked why NAR chose not to raise dues for next year and will update this story if and when a response is received.
In 2023, NAR raised dues for 2024 from $150 to $156. NAR members also pay a special assessment for a consumer ad campaign, which was raised to $45 in 2022.
Greg Hrabcak
NAR Treasurer Greg Hrabcak presented the Finance Committee’s proposal to the board. The board has about 1,000 members, at least 913 of whom were present at Thursday’s meeting.
In doing so, Hrabcak told the directors, “Membership is tracking favorably to plan and is increasing each month.”
This may have been a surprise. At least through February, NAR’s membership had been steadily declining in the wake of scandals, proliferating antitrust commission lawsuits, market conditions, and competition from a new trade group, American Real Estate Association (A.R.E.A.).
In February, NAR’s enrollment dipped below 1.5 million members for the first time since May 2021, the fourth-consecutive monthly decline. In 2023, NAR membership fell on an annual basis for the first time since 2012.
In a February presentation, NAR Chief Economist Lawrence Yun predicted further membership declines at the local, state and national levels over the next 24 months, “given the reduction in business opportunities over the past two years” and “the lag effects of past housing cycles.”
Inman has asked NAR for its latest monthly membership numbers and will update this story if and when a response is received. Until at least March, those figures were posted to NAR’s website, but last month the trade group scrubbed decades of membership data from its site, making it no longer available either to members or the public. NAR told Inman the data will be available to members again at some point in the future, but declined to explain the move.
The board voted overwhelmingly to keep dues the same, 894 in favor and 20 opposed, with no discussion from the floor.
Ethics changes
The NAR board also voted to amend Article 4 of the NAR Code of Ethics to clarify Realtors’ obligations when they have ownership interest in a property. Because it is a Code of Ethics change, however, the amendments will only go into effect in January if NAR’s delegate body approves them at NAR’s annual conference in November.
NAR’s delegate body is made up of local board presidents who attend one delegate body meeting in their one year of service and who only meet when changes to the NAR Constitution or the Code of Ethics are being considered.
Currently, Article 4 reads:
Realtors shall not acquire an interest in or buy or present offers from themselves, any member of their immediate families, their firms or any member thereof, or any entities in which they have any ownership interest, any real property without making their true position known to the owner or the owner’s agent or broker. In selling property they own, or in which they have any interest, Realtors shall reveal their ownership or interest in writing to the purchaser or the purchaser’s representative.
If the delegate body were to approve the change in November, the above would be stricken and Article 4 would read:
Realtors who have a present ownership interest in property for sale or lease, or contemplated interest to purchase or lease property, must disclose in writing the existence of such interest to all parties to the transaction prior to a party signing any agreement.
In addition, the article’s first standard of practice, 4-1, would change. Currently, that standard reads:
For the protection of all parties, the disclosures required by Article 4 shall be in writing and provided by Realtors prior to the signing of any contract.
If the delegate body approves, that would be stricken and would change to:
The present ownership interest in property for sale or lease, or contemplated interest to purchase or lease property, includes transactions in which Realtors:
1. represent themselves
2. represent a member of their immediate family
3. represent their firm or any broker or agent thereof
4. represent an entity in which the REALTOR(R) or member of their immediate family has a legal interest.
The board also voted to add a new Standard of Practice 4-2 that the delegate body will now consider. It reads:
REALTORS(R) are not required to disclose the identity of the client or customer, nor the specific nature of the interest referred to in Article 4, but must disclose that an interest exists.
NAR’s Professional Standards Committee put forth the recommended changes.
“Given that the potential for conflicts of interest exists on both the buy side and the listing side when a Realtor has a personal, familial, professional, or legal relationship to a party in any transaction, or has a present or contemplated interest in the property involved in a transaction, a Realtor’s obligations under Article 4 should protect buyers, sellers, lessors, and lessees alike,” the committee’s stated rationale for the changes reads.
“The proposed amendment to Article 4 incorporates the obligations currently outlined in Standard of Practice 4-1, so a new Standard of Practice 4-1 and Standard of Practice 4-2 have been added to give further clarity about said conflicts of interest and the information that Article 4 requires to be disclosed.”
The NAR board voted overwhelmingly to approve the changes, 881 in favor and 18 opposed, without any discussion from the floor.
NAR board meeting was unusually short due to governance changes the trade group implemented for the first time this year shifting the majority of the responsibility for approval of committee recommendations from NAR’s board to its Executive Committee.
Kevin Sears | NAR President
At the beginning of the board meeting, NAR President Kevin Sears reminded the directors of the change, telling them, “We will continue to keep you informed of the recommendations being presented to the Executive Committee and will keep you informed of the Executive Committee’s actions.”
Under the governance changes, the Executive Committee must meet a minimum of four times per year, give at least 15 days notice to the NAR board in advance of each meeting, and open its meetings to any interested NAR members.
At the midyear conference, the Executive Committee met twice, but its meetings were closed.
Inman has asked NAR why the meetings were closed, which committee recommendations the Executive Committee considered and whether they were approved. We will update this story if and when a response is received.
