PHOTO: National Association of Realtors (NAR).
Redfin has decided to sever its ties with the National Association of Realtors (N.A.R.) a month after The New York Times exposed a long-standing pattern of allegations involving sexual harassment, discrimination, and retaliation within the organization, which had gone unaddressed.
While the Seattle-based online brokerage acknowledged the challenge of completely disassociating itself from N.A.R. due to the group’s substantial influence in the industry, it announced on Monday that it would immediately require a significant portion of its 1,800 brokers and real estate agents to terminate their N.A.R. memberships and cease paying membership dues, often amounting to hundreds of dollars annually for each member.
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N.A.R. is a formidable nonprofit entity with 1.5 million members, making it the largest professional organization in the United States. The organization boasts over $1 billion in assets and holds control over crucial resources in many U.S. housing markets, including databases of home listings that agents rely on for buying and selling properties, lockboxes, and industry-standard contracts. Additionally, N.A.R. owns the trademark for the term “Realtor,” which means that in many parts of the country, real estate agents must pay membership dues to use the title “Realtor” and participate in property transactions.
Even before the sexual harassment allegations surfaced, N.A.R. had been experiencing dissatisfaction within the industry. The organization is currently embroiled in multiple lawsuits alleging violations of antitrust laws and the inflation of fees paid by home sellers to their buyers’ agents.
Redfin’s CEO, Glenn Kelman, expressed long-standing frustration with N.A.R.’s resistance to revising its policies on broker compensation. In June, Redfin decided to remove Joe Rath, Redfin’s head of industry relations, from N.A.R.’s board of directors. Redfin secured a seat on the 900-person board in 2022 due to its size and influence in the industry.
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Mantill Williams, a spokesperson for N.A.R., acknowledged Redfin’s decision but emphasized N.A.R.’s policies on agent compensation and the value of membership dues in accessing home listing databases. He declined to comment on the sexual harassment allegations and their role in Redfin’s decision.
Redfin’s ability to completely sever ties with N.A.R. varies by location. In many major U.S. cities, including Houston, Las Vegas, Nashville, and Phoenix, N.A.R. controls listing databases to such an extent that Redfin agents cannot operate independently. However, in over 100 housing markets across the United States, including Seattle, Boston, and New York City, Redfin agents will no longer pay N.A.R. dues, resulting in an annual loss of approximately $1 million for N.A.R., according to Mr. Kelman.
When Redfin initially joined N.A.R. in 2017, Mr. Kelman had hoped to influence the organization’s policies from within. However, over time, Redfin’s leadership came to believe this was not achievable, as N.A.R. was perceived as an insular group that closed ranks when facing criticism.
Mr. Kelman finds this cultural aspect of N.A.R. problematic, stating that there are progressive elements within N.A.R. eager to take a more consumer-focused stance. He expressed puzzlement at N.A.R.’s loyalty to a select few members and refrained from predicting if others would follow Redfin’s lead, noting the industry’s cautious nature. Nonetheless, Redfin has been working to untangle its relationship with N.A.R. for several months.
In August, The New York Times published an article in which multiple women accused Kenny Parcell, N.A.R.’s former president, of harassment and inappropriate behavior. Mr. Parcell resigned within 48 hours of the allegations coming to light. Calls for greater reform within the organization persist, with more than 29 employees and former leaders revealing a pattern of silencing whistleblowers, supported by a lawsuit and an internal memo obtained by The Times.
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Following the Times’ report, Jason Haber, a real estate agent with Compass, initiated the N.A.R. Accountability Project, advocating for an overhaul of the organization’s executive leadership. He also launched a petition demanding the immediate resignation of Bob Goldberg, N.A.R.’s chief executive, which has garnered over 800 signatures.
Mr. Kelman emphasized that the emergence of harassment issues brought a heightened level of concern to the situation.
SOURCE: NY TIMES