Among the most important organizations in the real estate industry is the National Association of Realtors. The members of this organization are considered to be realtors or real estate brokers. The NAR was founded was to effectively promote the broader real estate industry while also making sure that every member displays professional behavior while on the job.
At the moment, this organization is comprised of more than one million members all around the world. When the NAR first began in 1908, it was known as the National Association of Real Estate Exchanges and was mainly based out of Chicago. Even though the NAR started with just one state association and 120 founding members, it has since grown to consist of 54 state associations.
Over the years, the NAR has changed names and core objectives several times before reaching the association that it is today. The NAR Code of Ethics was created in 1913 with a primary focus being placed on the Golden Rule. It wasn’t until 1972 that the name of the organization was changed to the National Association of Realtors.
Today, the NAR’s mission is to “preserve, protect, and advance the right to real property for all”. Their vision involves making sure that they guide their members through the constantly changing real estate landscape. Keep in mind that anyone who becomes a realtor must adhere to the Code of Ethics mentioned previously, which is why the National Association of Realtors has a leading role in the real estate industry.
The real estate professionals who become realtors automatically gain a strong reputation by being associated with the NAR. As such, realtors are in high demand from people who want to list their home on the market or purchase a new home. The following is a detailed overview of the National Association of Realtors and the role they have in the industry.
Everything You Need to Know About the NAR
The National Association of Realtors is an organization that was formed to enhance the real estate industry and make sure that members within the organization adhered to certain regulations and guidelines. Real estate agents and industry professionals who join the organization are referred to as realtors. Upon joining the NAR, these professionals are granted access to many tools and benefits that will help them perform their jobs more effectively.
The NAR also works hard to maintain private property rights and promote home-ownership. Today, the NAR boasts nearly 1.4 million members. Along with real estate brokers and salespeople, NAR members include counselors, property managers, and appraisers. The organization itself is broken down into 1,200 separate local boards and associations, and 54 territory and state associations. There are also dozens of NAR associations outside of the U.S.
In order for a real estate agent or similar industry professional to become a member of the National Association of Realtors, the real estate firm that they work for must first become a member. The entities allowed to become members of the NAR include partners of a partnership, sole proprietors, branch-office managers, and corporate officers.
Once the principal firm or entity has joined the NAR, every agent, appraiser, or broker within the firm will also be given the option to join. Anyone who’s able to become a member of a local NAR association will also be granted membership to state and national NAR associations.
The annual dues that NAR members are tasked with paying are $150 alongside an assessment of $35 that goes to the Consumer Advertising Campaign that the NAR maintains. In return for these dues and membership to the organization, realtors are given access to an array of notable benefits and tools that allow them to provide clients with exemplary service.
The NAR Code of Ethics
The NAR maintains a Code of Ethics that requires every member to adhere to if they want to continue being a member of the NAR. The purpose of the Code of Ethics is to hold realtors to a higher standard, which is why people who are looking to buy or sell a home know that they are hiring a reputable professional.
This document has been in existence since 1913. However, it has undergone many changes since that time. While the Code of Ethics was initially centered around the golden rule, it has since expanded to include many more guidelines that realtors need to follow. The Code of Ethics is essentially broken down into three segments that include duties to customers and clients, duties to realtors, and duties to the public.
Each segment is further broken down into articles and standards of practice. For instance, the segment about duties to customers and clients contains nine articles, many of which consist of multiple standards of practice. An example in the duties to customers and clients section involves Standard of Practice 1-3, which states that realtors cannot deliberately mislead owners about the market value of their home when attempting to gain a listing.
When looking at the duties that NAR members have to the public, one example is Standard of Practice 12-7, which states that the only realtors who can claim to have actually sold the property will need to have been involved in the completed transaction as the cooperating broker or listing broker. The only way a cooperating broker can place a “Sold” sign on the property in question is if they have first obtained permission to do so by the listing broker.
As for the duties that NAR members have to other realtors, it’s important to look at Standard of Practice 16-8, which states that one realtor can enter into an exclusive agreement with a buyer or seller even if a previous exclusive agreement existed with another realtor. Overall, there are dozens of standards of practice that each realtor is expected to follow. It’s possible for realtors to be charged with unethical practice if they break one of the guidelines, which can involve extensive investigations.
How the NAR Works for Realtors
As mentioned previously, there are around 1,400 local boards that real estate agents are able to join once they become an NAR member. The fees that each realtor owes amount to $185, a small portion of which is used by the NAR for political lobbying. When a realtor pays their dues on time, the NAR gives them access to a considerable amount of resources and benefits that other real estate agents outside of the NAR wouldn’t have easy access to.
The NAR is also responsible for making sure that each realtor within the organization maintains the Code of Ethics. If more than one violation of the Code of Ethics occurs, the realtor could be asked to leave the NAR. The benefits that NAR members are given change on an annual basis to better reflect changes in the real estate industry. The NAR wants their members to improve the industry and raise its standards.
Strategic Benefits of NAR for Realtors
Realtors who gain membership to the NAR are given many different types of resources that allow them to be better at their jobs. In fact, the educational resources are more than enough to justify the annual dues. These resources allow realtors to obtain a comprehensive understanding of the local real estate market. It’s possible for realtors under the NAR to use nationally collected data from the Pending Home Sales Index as well as the Housing Affordability Index while on the job.
With these resources in hand, realtors are able to provide their clients with in-depth knowledge of the current housing market conditions. Over time, the NAR has been able to partner with more than 30 companies that are involved with the real estate industry. These companies have delivered many distinct benefits that are separated into categories like:
- Marketing resources
- Educational tools
- Risk management
- Personal insurance
- Travel and automotive
- Technology services
- Electronics and mobile technology
- Home and lifestyle
- Transaction management
- Office supplies and services
Added Benefits of NAR Membership for a Realtor’s Client
If you’re thinking of hiring an NAR realtor to help you buy or sell a home, doing so can be beneficial for he transaction. For one, you’ll be given comprehensive data about specific neighborhoods and areas that non-members likely wouldn’t have access to. When you want to place a home on the market but don’t know what price to list it at, a realtor can use extensive data about nearby homes and the prices they have sold at to determine what the ideal listing price for your home would be.
Most realtors have good standing in the industry and have built up networks with other real estate agents. If you want to view a home, the realtor you’ve hired may have already developed a working relationship with the seller’s agent, which means that the visit could be scheduled in next to no time.
Is It Worth It to Hire an NAR Realtor?
If you’re wondering about the feasibility of hiring an NAR realtor to help you buy or sell a home, keep in mind that hiring a realtor for this process makes it more likely that you will be able to complete the transaction without any unnecessary delays.
While there are certainly reputable real estate agents who have simply chosen not to become an NAR member, hiring a realtor automatically gives you access to all of the resources the NAR makes available to their members. The benefits of hiring a realtor far outweigh the potential downsides, of which there are hardly any. Since realtors don’t cost more to hire than real estate agents, doing so shouldn’t be an issue.