Strengthening NAR’s Value Proposition

Author: Jonathan Dalton

Posted on December 5, 2007 
Filed Under NAR - General

As a starting point, can we all agree that there are areas in which the National Association of REALTORS can improve both in the perception of the public and of its members? I hope so. All of us can improve in one way or another. Of course, if you believe NAR is fulfilling its mission perfectly already, you’re excused.

Let’s take the public side first. One of NAR’s main advertising messages is that all of its members subscribe to a strict Code of Ethics. Which is true, as far as that goes. Being a member of NAR does mean we’ve subscribed to the Code of Ethics. But very few of us join NAR specifically because our personal business beliefs align with the COE. In fact, the COE often is an after-thought thoroughly secondary to the real reason to join NAR - to have MLS access.

This isn’t an issue in all areas and those in real estate markets where the local boards do not control the MLS have my undying envy. That’s not the case here in Phoenix. If you want to have MLS access - if you want access to listings to search for your buyers and to what remains the best marketing vehicle out there - you MUST join NAR.

It’s not mandatory, as I’ve been told. But it’s necessary if you want to have any business.

If NAR wants to strengthen the COE as a value proposition to the public, surrender the control of the local boards to area brokers. Get out of the listings business and focus on your core purpose of promoting real estate agents in the eyes of the public and all levels of government.

Give real estate agents the choice whether they will live up the standards of the COE and give teeth to the statement that NAR members subscribe to such a strict code; those who choose to join when their MLS access no longer depends on membership truly will meet the high standard implied in the advertising.

Now the agent perspective. Stop with the monthly forecasts. Or, at a bare minimum, force the senior economist du jour to anchor his remarks in reality at some point in time.

David Lereah and Lawrence Yun have done more to damage the trademark than any other forces in action. There are many agents who subscribe to the same “it’s always a great time to buy, real estate never falls” theory of real estate economics; fortunately, they’re limiting their damage to the people with which they come in contact.

Lereah and Yun, however, are quoted widely. And in the nearly two years of desperation fantasies guesses about the timing of the market bottom they’re ignoring the very basic reality of this business. For many of us, our success does not depend on the condition of the real estate market.

Mega-producers such as Russell Shaw have said this forever. But any agent, with a little bit of effort, can find ways to succeed regardless of market conditions.

The most overrated question in our business is “how’s the market?” (At last week’s sales meeting I shouted Tom Hopkins’ “Unbelievable!” just for the fun of it.) The market isn’t good. The market isn’t bad. The market is what the market is. People still buy. People still sell. It’s up the us as real estate professionals to find them.

Constantly striving to call the bottom implies that the market is “bad” when there is no such thing as an empirically “good” or “bad” market. There are seller’s markets and buyers’ markets and neither is better for the other. Working primarily with buyers in 2005, I was hard pressed to say the market was great. It was great for the sellers. It was horrifying for my buyers.

And that doesn’t even touch on the fact that constantly calling for the bottom only serves to destroy both your credibility and that of the organization you represent - and all of its members by extension.

NAR isn’t broken beyond repair. As a lobbying group, NAR remains incredibly strong. A large portion of the effort is put forth on behalf of real estate agents but NAR also takes stands on multiple housing-related issues that primarily impact consumers. Our local lobbyist cringes when we joke that nothing passes he doesn’t want passed, but I don’t think we’re too far off the mark.

There’s value in that.

There’s value in conveying an accurate assessment of the real estate market without the speculation that a recovery’s around the corner. We won’t see the recovery until it has happened; calling for it monthly is folly. We’re not at a point where NAR report accuracy.

There’s value in having a membership that truly believes in the (overly lengthy) Code of Ethics rather than a membership who only wants MLS access and considers the bi-annual ethics training little more than a nuisance of doing business. We’re not at a point where membership is optional, either.

Truthfully, there’s virtually no chance of NAR surrendering the local Multiple Listing Services without a broker-level revolt. Though there are a few dissenters, most notably in Minnesota, NAR isn’t looking to shrink its membership ranks. In fact, anticipated drops in membership led to a dues increase for those who remain. Apparently the fiefdoms built while the market was running in overdrive cannot be broken down. Or no one at NAR headquarters has the will to destroy them.

Want my support for the ongoing Public Awareness Campaign, Richard Gaylord and friends? Take the steps above as a starting point and it’s yours.

<Editor’s note: this post is a contribution from Jonathan Dalton>

Comments

3 Responses to “Strengthening NAR’s Value Proposition”

  1. Jim Duncan on December 5th, 2007 6:20 pm

    Jonathan -

    Well said. NAR’s broken, but not beyond repair.

  2. Jonathan Dalton on December 5th, 2007 9:55 pm

    Question remains how it can be fixed, if it can be fixed. I’ve read/heard that changes need to come from within but I’m not sure how that’s possible when dealing with such a monolithic organization.

    There are 800-odd NAR board members, for example. Will working on a sub-committee for a local board truly make the slightest bit of difference?

    It would be nice but I find it unlikely.

  3. Repairing NAR … a Few Brief Thoughts | Phoenix Real Estate and Homes for Sale - Dalton’s Arizona Homes Blog on December 6th, 2007 12:05 am

    […] the longer version check out my debut post on NAR […]

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