NAR's Rebuttal
May 19, 2007
Rich:
Thanks for your prompt response and for your offer to run an Editor's Note on your Web site. Permit me a couple of suggestions.
Our concern was not whether your portrayal of business models like RE/MAX or Redfin was fair. As I told you several times, NAR represents all business models and favors none. In fact, that's why you decided not to interview Pat Vredevoogd Combs when you sought someone to defend the "traditional" business model. Our concern with the segment was your one-sided discussion of our Internet listing display policies. We understand why you chose not to delve into the DoJ case, but we don't understand why you let two critics attack our policies, then chose not to interview any of the three spokespersons we offered to address the opposing view in favor of one sentence of narration. The lack of fairness was obvious and did not build credibility.
Regarding your statement about NAR "governing" the industry, our code of ethics is unique in the business world. It does indeed address business practices as they affect relations between REALTORS® and with consumers. MLSs are governed by their own boards of directors and NAR gets involved only on cross-jurisdictional issues like Internet listing display. Does the National Association of Broadcasters "govern" CBS? Perhaps "represents" would be a more accurate term.
On the Editor's Note, below is EXACTLY what the General Accounting Office said in its 2005 report, including several words you omitted:
Although there are no comprehensive data on brokerage fees, past analyses and anecdotal information suggest that commission rates have persisted in the same range -- roughly 5 percent to 7 percent of a property's selling price -- over long periods, regardless of local market conditions, housing prices, or the cost or effort required to sell different properties.
"Past analyses" means prior to 2005. "Anecdotal" means unscientific. The Real Trends number is more widely accepted and was in fact cited by the GAO in its much more comprehensive 2006 report on the industry. From the New York Times and Wall Street Journal to the Washington Post and the AP, the Real Trends figure has been reported and accepted as the best available. Like you, we wish there was more data available but the fact is that the average commission is NOT 6 percent and has not been for many years. Clearly, commissions are negotiable.
Regarding MLSs, REALTORS® do indeed control most of them. That's because REALTORS® OWN them. Just like CBS controls 60 Minutes.
Would you please consider revising the Editor's Note with these thoughts in mind? Thanks!
Sincerely,
Stephen Cook
Vice President, Public Affairs and Strategic Planning
National Association of REALTORS®
500 New Jersey Avenue NW
Washington, DC 20001
