SAN FRANCISCO – Nov. 13, 2013 – A meeting of the National Association of Realtors® (NAR) Board of Directors wound up the 2013 Realtors Conference & Expo that took place last week in San Francisco. It approved the following changes:
The NAR Board unanimously approved an ambitious project: Partner with a major investor to turn the association’s Chicago headquarters into a world-class property. While details must be worked out and the decision is not final, the board vote enables the exploration phase to move forward.
The property would replace NAR’s 50-year-old, class B+ property with a Realtor-branded, 1 to 2-million-square-foot Class A+ building and plaza. It would include a 5-star hotel, condominiums, office space and ground-level retail. Under preliminary plans subject to final agreement with the partner, Realtors would own 180,000 square feet of the building plus a percentage of the overall project.
Among its main decisions, the Board adopted a policy position opposing the use of eminent domain to help underwater homeowners. The tactic has local governments buying a home at current fair market value as a way to help current homeowners living in a house worth less than they paid for it during the recession.
Under the policy statement, NAR says it understands the need to help struggling homeowners, but taking mortgages hurts the availability and affordability of financing for other borrowers because of the uncertainty it creates for lenders and investors.
In a related matter, the Board authorized the distribution of $485,000 in funds from NAR’s Issues Mobilization program to the West Contra Costa, Calif., Association of Realtors to help it fight the use of eminent domain to seize mortgages in Richmond, Calif., the first city in the country to launch such a program.
Discrimination, disparate impact
The Delegate Body, approving a Board of Director’s action from earlier this year, added a policy opposing gender-identity discrimination to its statement of Fair Housing Policy.
In addition, the Board adopted a new policy on disparate impact, which is a form of discrimination under the Fair Housing Act. The new policy makes NAR’s support clear for Fair Housing, but it takes the position that Realtors shouldn’t be penalized when legitimate business practices unintentionally have a disparate impact on a protected class.
An example would be an owner’s policy to screen out drug criminals from a rental property. Under the policy, the burden should fall on organizations alleging disparate impact to show the owner had a discriminatory intent.
The Board modified a policy change approved earlier this year that required one year of national service as a condition of becoming a Realtor Emeritus member. Under the modification, the Board is phasing in the requirement, allowing candidates for emeritus status to meet their requirement with a year of service on a state or local committee or other specified role. The modification is scheduled to sunset in five years, after which the one-year of service will have to be in a national role.
In several changes to the association’s dues, the Board created an exception to how dues are calculated for members who engage exclusively in mortgage loan origination, though the exception applies exclusively to California because of a unique licensing requirement there.
Separately, the Board approved dues amounts of $500 for the National Affiliate member category (which applies to members of affiliated organizations), $200 for the Academic Category, and $105 for the Institute Affiliate category, up from $75, with $35 each going to the national, state and local levels.
The Board amended Interpretation No. 32 of Article I, Section 2, of the NAR Bylaws to clarify that the cost of lockbox services, where it is a service of the local association, may, at the association’s discretion, be included in association dues.
The Board took a number of actions to enhance the industry’s professional standards.
To ensure practitioners are qualified and have access to the information needed to do broker price opinions (BPO) properly and to require disclosures when they’re doing them for others, the Board made changes to Standard of Practice 11-1, including requiring Realtors doing a BPO to be knowledgeable about the property type and area.
To ensure that only individuals and not companies, associations or other entities can file ethics complaints, the Board clarified that “person” in the Code of Ethics means “natural person.”
The Board amended Section 22(a), Decision of Hearing Panel, in the Code of Ethics and Arbitration Manual to direct hearing panels to consider a respondent’s prior violations, among other things, when determining how to discipline a member.
To help advance the industry’s interests in the legal arena, the Board allocated $363,667.55 to help with legal costs in six cases, including Minnesota and Florida cases involving copyright infringement by website operators using MLS data without authorization, a trademark dispute in California, and an issue involving the duty to arbitrate in New York, among others.
The Board recommended, and the Delegate Body later approved, a constitutional amendment to limit the NAR treasurer to a single two-year term, although in cases of a vacancy, former treasurers can be appointed by the Board to step in. Separately, the Board approved changes to create parity between how past treasurers and other past national officers are treated. Among other things, past treasurers will be designated ex officio members of the Board of Directors.
Among a handful of changes to some NAR committee structures, the board renamed the Strategic Planning Committee as the Strategic Thinking Advisory Committee and expanded its focus to include trends affecting real estate consumers.
Later in the meeting, the Board approved a three-year strategic plan, which emphasizes innovation and transformation in the way NAR undertakes its planning. It was developed after a 15-month process called REThink, which sought input from members in sessions around the country and online.
Property lot descriptions
In a public policy action, the Board adopted a policy on Interstate Land Sales Act disclosures to pave the way for NAR to support legislation preventing buyers from using a disclosure technicality to back out of condo purchases.
Primarily in areas with once-hot condo markets, buyers who bought units before they were developed, when prices were high, have been getting out of contracts by charging developers with not fully describing lots in disclosure documents. The tactic penalizes developers because full descriptions are typically not possible until after project completion.
Legislation in Congress would address this by imposing the same reporting requirements on projects under construction that apply to projects already completed.
Contributions to the Realtors Political Action Committee this year reached $24,700,946, including $8,111,081 for national advocacy efforts. That’s 11 percent more than was raised last year, reported Michael Ford, RPAC Trustees Fundraising Committee chair. In all, 261,000 members invested in RPAC this year, including 4,718 major investors and 602 President’s Circle members.
Realtors Relief Foundation
The Realtors Relief Foundation generated more than $55,000 in proceeds from its first online auction, which attracted bids, both on-site and online, from 1,000 participants. Since 2001, the Foundation has distributed $22 million in assistance to Realtors and others hit by disasters.
• Directors heard a report from realtor.com President Errol Samuelson on its success in boosting traffic since a special meeting this summer in which the Board gave increased flexibility to the website to feature more new-home, rental, and non-MLS listings. Among other things, the site now has some 250,000 rental listings and is on track to increase that to 450,000 early next year, making it the leader in rental listings among national listing aggregation sites.
• The Board also heard a report on the success of NAR’s consumer advertising campaign, now in its 15th year. Just under 70 percent of consumers now recognize NAR as the sponsor of the campaign ads – the highest degree of recognition since the program started – and 92 percent say Realtors can help consumers find a home that’s right for them, another high.
• The Board heard about the new “.Realtor” high-level domain name slated to be available in early 2014. Over the course of the conference, some 12,000 members pre-registered to use the new domain in their business.
© 2013 Florida Realtors®