Here we go again!

NAR should be seen here in its true light, a purveyor of control, monopolization and the promotion of the punishment of creative models that do not meet the local real estate dominance model put in force and sustained by its vast network of local Associations.

Although we are not supporters of discount brokerage as a viable business model, we feel the need to speak out on this issue and the freedom of Broker-Owners to create business models without the fear of retaliation and punishment by NAR and local Associations.

We are forced to ask the question, “Is anyone paying attention to how our dues, financial assets and human capital are being used by NAR?” Furthermore, are we paying attention to how NAR and local Associations are dealing with Broker-Owners who are not lining up in lock-step with centralized policy?

NAR’s support of Realcomp’s position, backed by a commitment of $500,000 in member funds, comes on the heals of its unprecedented announcement of its support for the extension of the federal home buying credit.

FACT ANALYSIS: This is a credit that is funded by tax-paying consumers and given to under qualified home buyers who lack their own financial capacity to purchase a home without a subsidy. Is this NAR’s new version of the now regretable community lending laws forced upon banks by Congress?

It appears that while NAR attempts to convey to its members that it is on the cutting edge of creative solutions for the industry (yes, some of these solutions are excellent), behind the scenes it continues to accellerate the wielding its financial and market control to further sustain its self-serving monopoly and potentially lethal grip on the industry.

While we are not opposed to supporting sound MLS policies or lobbying in favor of industry issues, we do wonder why NAR continues to fight independent Broker-Owner creativity at the local level and why it supports home purchases funded by the extraction and transfer of wealth from tax paying consumers to under-qualified home buyers.

HISTORICAL REVIEW. NAR has locked horns with the DOJ over many of its policies and historically come out on the losing end of these battles, squandering millions of our dollars on old-line, control models that contribute further to the decline of our industry and the capability of Broker-Owners to sustain their businesses.

Isn’t it time for the industry to start asking NAR leaders some hard questions about what they support and why? More importantly, why isn’t NAR using its lobbying and financial clout (again, our money) to assist Broker-Owners with financial support, in the form of business loans and grants for the reinvention of our failing models?

We have three dangerous forms of consumer, financial and business model control happening within the industry, each harming Broker-Owners and their ability to create and sustain profitability. The first of these is NAR itself, the second is franchising and the third is local MLS property information policies.

Each of these three factors can and sometimes do work against the ability of Broker-Owners to create models that produce sustain ROI and profitability.

After all, NAR, franchisors and local Associations have their own self-serving agendas for financial survival, even it it means the further erosion of Broker-Owner viability.

NAR, like all large organization and bureaucratic structures, is beginning to miss the mark with respect to whos money fuels the financial coffers. Bureacracies often forget for whom they toil.

Tails should not wag dogs.

No related posts.

Here is the official scripted response by NAR from Vicki Cox Golder, 2008 NAR First Vice President & Laurie Janik, NAR General Counsel. NAR President Dick Gaylord is also featured here.

Related posts:

1. Bill Gates – ’92 Predictions
2. DOJ & NAR SETTLE SUIT – It looks like everyone’s coming up roses!

REALonomics Editorial

There is an old saying, “After all is said and done, more will be said than is done.” The long battle between the Department of Justice (DOJ) and the National Association of Realtors (NAR) was declared “settled” today.

Not so fast! After a reading of the Final Judgment document, REALonomics offers the following cursory observations:

• THE GOOD: NAR cannot prohibit the distribution of full MLS listing information;
• THE BAD: Local Associations cannot engage in unique policies about local listing distribution;
• THE UGLY: NAR must report to the DOJ quarterly…this ain’t over, folks;

After all has been said and done, more has been said…and spent…than done with respect to how the real estate industry under the leadership of NAR has moved from its control model to a transparent model that will unleash the kind of innovation and consumer-centric services we need.

Furthermore, the DOJ has now completed one of its central objectives, to position itselfself as the sole arbiter of real estate property information access, all local associations and members of NAR and more importantly, as we have said before, to eventually control services and commissions.

Mark this down and highlight it: When the DOJ does anything under the banner of “public interest” there is a north and south point of reference, depending on one’s facing. Decide for yourself what this important section of the settlement might mean to the industry, long term and short term (highlights ours):

The big loser here is actually the industry itself, the thousands of broker/owners and yes, temporarily, even the consumer. NAR will remain under the DOJ microscope for some time to come. This entire debacle, we predict, is the precursor to mandated services and commission control. In this case, we hope to be wrong. The solution, we have long contended, is a reinvention of our models, how we use and distribute property information and finally, how we best serve the consumer, our ultimate client.

The settlement serves no real purpose yet! It’s just more of the same old square dancing between NAR and the DOJ. But watch out when people say it means nothing fail to see the overall DOJ strategy fuel by anti real estate indutry sentiment from consumer watch dog groups.

PRINCIPLE: It’s about the MONEY, stupid…commissions. This is just the beginning of a long death march toward more national scrutiny. We are going to tango with the DOJ again. This is not really about VOWs and property information. It truly is about US, the industry and our practices that smell of control and dominance and to quote the DOJ, anti-trust inclinations.

BIG WINNERS: The non-brokers, non-industry innovators and the neo-brokers are the big winners here. The “judgement” is a precursor, nothing more, nothing less. It’s the swinging open of a previously locked door so that we can see what’s on the other side. It’s what lawyers call “precident” and “legal trending.”

BIG WINNERS: Transparent advocates. It will be impossible to thwart the Democratization of Real Estate in an ultimate sense. This decision is like a strand of DNA but not the entire structure.

True, NAR may now face restrictions on its traditional control tactics but there’s more to the story when we recognize that competitors are waiting in the wings to bring open-sourced property information models to the forefront by empowering property owners to do whatever they please.

Our issue as an industry remains completely unchanged. Why haven’t we been able or willing or both to reinvent this industry into a vibrant, consumer-centric model that both empowers users and delivers adequate and sustained profit to broker/owners. The short answer is we don’t know how to do it!

For now we will simply continue the NAR/DOJ dance until one of them collapses. Does anyone think the DOJ will collapse?

READ THE Final Judgment.

Related posts:

1. NAR Explains DOJ Settlement