After months of plaintiffs’ lawyers in commission lawsuits claiming that the National Association of Realtors sets real estate agent commissions, the trade group finally decided to, in its words, “set the record straight.”
In a video posted on Wednesday, NAR interim CEO Nykia Wright told viewers that, “the notion that the National Association of Realtors controls what real estate professionals get paid is wholly untrue.”
“NAR does not set commissions; it never has and it never will. Period. End of story,” she continued.
Wright said that the industry has been “vilified by certain plaintiffs’ lawyers, sensationalized by a few reporters and misrepresented by people who know little about this business.”
The influential trade group lost a $5.3 billion class-action lawsuit in Missouri known as Sitzer/Burnett in October. A jury ruled that NAR and various real estate brokerages conspired to stabilize or increase commissions and used the NAR’s cooperative compensation rule as a vehicle to do it.
NAR is also a defendant in nearly two dozen additional commission lawsuits across the country.
In the video posted on Wednesday, Wright addressed claims that the internet age and tools available to homebuyers should have reduced the cost of using a buyer’s agent. Michael Ketchmark, the attorney who won the Sitzer/Burnett case, argues that the workload of the buyer’s agent has decreased with the advent of the internet.
“The internet can be a tool, but it is not a replacement for the essential services agents who are Realtors provide. A real estate transaction is not a simple click and purchase, like buyer a plane ticket online,” Wright said. “Most Americans choose to use a real estate professional when buying or selling a home not because they’re required to, but because of the help that one provides in navigating the challenges that are part of the process of buying or selling a home.”
The video pointed to the many other things the trade organization does to assist Realtors, including its advocacy and lobbying work, as well as the opportunities it provides for training, education, and professional certifications.
“NAR has led our industry forward for more than 100 years by focusing on ethics, professionalism, advocacy, and putting consumers first. The result is transparent and competitive marketplaces, satisfied clients, and stronger communities,” the trade group wrote in a statement accompanying the video.
In addition to commissions and the value of an agent, Wright also addressed what she called “a new association.”
Last Tuesday, The Agency founder Mauricio Umansky, and NAR critic and Compass agent Jason Haber, announced the creation of the American Real Estate Association, an alternative real estate agent trade association.
“We welcome competition from anyone who can match our impact and deliver the kind of value we bring,” Wright said in the video.
“We take pride in the work we do and will continue to help sellers walk away having sold at a competitive price and buyers get the keys to their dream homes,” she concluded.
NAR recently named Kevin Sears, a Massachusetts broker, as its latest president following the departure of Tracy Kasper, who resigned after allegedly being blackmailed. Kasper took over in August in the wake of a sexual harassment scandal that resulted in the resignation of her predecessor, Kenny Parcell. Several longtime NAR staffers, including CEO Bob Goldberg and head of HR Donna Gland, have also left since the $5.3 billion Sitzer/Burnett verdict in Missouri.
Editor’s Note: NAR posted an updated version of the video Wednesday evening, correcting the claim that it had never set agent commissions.
