“This is a moment in history when NAREB and our national leaders must stand up for justice and equality,” National Association of Realtors President Dr. Courtney Johnson Rose wrote.
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When the National Association of Realtors (NAR) recently reached a settlement in a series of class-action lawsuits seeking to compensate buyer’s agents, some experts praised the move. “A win-win situation for home buyers and sellers” and “earthquake” This is good for consumers.
However, in National Association of Realtors (NAREB), we represent Black real estate professionals who most often work with Black homebuyers, and we fear the impact this will have on Black agents, brokers, and homebuyers will be devastating.
Settlement in Missouri case, Sitzer | Burnett awaits court approval as he expresses concern about resurgence of discriminatory practices that hurt Black real estate professionals and create greater burdens for Black families and individuals who want to become homeowners Many obstacles.
At the heart of the settlement is a change to the commission structure for real estate transactions. NAR agrees to eliminate explicit broker compensation for MLS listings.
While this change is intended to introduce equity and reduce costs, it has the potential to exacerbate disparities, particularly for marginalized communities. The settlement could require homebuyers to pay their agents directly, which could have significant ramifications for Black families and individuals struggling to enter the housing market.
Our colleagues at the National Association of Hispanic Real Estate Professionals also care On the impact of the settlement agreement on its members. Gary Acosta, co-founder and CEO of NAHREP, said the plaintiffs and supporters of these lawsuits claim to represent consumers, but in fact, what they orchestrate “does nothing more than harm first-time homebuyers and small businesses.” Malicious attacks on enterprises”.
The Unique Challenges of Obtaining Homeownership
Research conducted by groups such as nonprofit organizations urban institute to mortgage companies loan tree Even Nar Reveals how minorities, including black people, face unique challenges in gaining homeownership due to historical discrimination and economic disparities. The added financial burden of paying agent commissions may further limit their ability to purchase a home, perpetuating a cycle of inequality.
In fact, there are more than 2 Million African American Renters Ready for Mortgages Who Are Not Homeowners, and Black Homeownership Rates hovering at 44.1%, significantly It is lower than the 73% homeownership rate of white people, with a gap of 29%.
What’s more, removing explicit broker compensation from MLS listings opens the door to discriminatory practices, such as “pocket listings,” that could turn back the clock and exclude Black buyers from certain properties.
Pocket lists are essentially private lists, also known as “Off-market house listing” and is considered by some to be “Sell your house on the sly” Enabling sellers to directly select potential buyers may discriminate against Black people or other marginalized groups. With this settlement, there is a risk that discriminatory practices such as pocket tagging will become more common, potentially undermining hard-won gains in fair housing and equal opportunity.
How NARB promotes “housing democracy”
At NAREB, we formed a task force to study solutions, and our findings echo these concerns. In 1947, our founding members established Our organization in Tampa, Florida faces pervasive discriminatory practices in housing such as segregation, redlining, and exclusion from NAR because of skin color. Our motto is “Housing Democracy” and equal housing opportunities for all.
Many of our members — Black real estate agents and brokers — worry that the settlement could reignite discrimination in real estate transactions, with discriminatory practices like pocket listings undoing decades of progress in combating housing inequality.
Additionally, shifts in commission structures have disproportionately affected first-time and first-generation homebuyers, many of whom are Black, further widening racial homeownership and wealth gaps.
At NAREB, we are assisting our members in navigating these changes. Initiatives like the NAREB Black Developer Academy provide pathways to economic empowerment and could mitigate some of the impact of the settlement on Black real estate professionals. However, more comprehensive measures are needed to mitigate the negative impacts on Black real estate professionals and communities.
Down payment assistance programs and tax credits for low- and moderate-income homebuyers may help ease the financial burden of new commission structures, thereby promoting greater inclusion in the housing market.
Additionally, we will increase our advocacy efforts to prevent discriminatory practices and ensure equitable access to homeownership. NAREB has also developed the Realtist Toolkit for our members, which includes the most relevant information and resources to help them.
As we face the impact of the settlement, we tell our members that we must remain vigilant in upholding the principles of fairness and justice in the real estate sector. By addressing systemic barriers and promoting equitable policies, we can work toward a future where housing is available to all, regardless of race, religion, or socioeconomic status.
We need the public and private sectors to recognize that Black consumers and real estate professionals may be experiencing additional burdens and use this moment as an opportunity to take steps, such as expanding special purpose credit programs that can increase Black homeownership.
Homeownership is a generational driver of wealth, and for decades, Black people have been denied this wealth through discriminatory policies and practices. This is a historic moment when NAREB and our national leaders must stand up for justice and equality. They must acknowledge the damaging effects of past policies rather than create an environment to which they can return.
Without pathways to homeownership, the dream of equitable communities will never become a reality. We must keep this dream alive in our enduring pursuit of housing democracy.
Dr. Courtney Johnson-Ross is president of the National Association of Realtors. For more information, visit the organization’s website at NAREB.com.
