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Following Day 1 of voting for Inman’s News Knockout of 2024, readers decided which of the year’s top stories would advance to the Elite 8 round of voting.
The battle between the NAR and the National Association of Realtors, the Tripartite Agreement and the MLS, and the Portal and Commission articles remained close throughout the first day of voting. But by Tuesday morning, reader preferences for NAR, MLS, and Portal won out.
Meanwhile, stories about commission lawsuit settlements, scrutiny of changing industry practices, and allegations of wrongdoing by high-end brokers emerged as landslide winners in their respective categories.
Which stories will advance to this year’s Top Stories in the Final Four? Only Inman readers can decide.
Bracket 1: Commission Litigation Settlement vs. NAR
“NAR agrees to significant changes to $418 million fee settlement.”
Written by Taylor Anderson
The National Association of Realtors was in the spotlight this year when it announced a $418 million settlement in an Antitrust Commission case that has rocked the industry in recent years. The settlement, to be paid by NAR over the next four years, also provides for a series of industry practice changes that agents, brokers, associations and MLSs must implement by August 17, 2024.
In it, NAR agreed not to create rules that would allow listing agents to set compensation for buyer brokers. The association also enacted new rules prohibiting compensation offers from being made within MLS. Buyer brokers who are MLS participants are also required to enter into a written representation agreement prior to home tours.
The terms of the settlement fundamentally change the way real estate professionals view their roles as salespeople and advisors, and have already begun to impact how consumers view the industry, according to early data from Inman Intel.
“NAR CEO Nikia Wright appears in ‘bizarre’ new video, then disappears.”
Written by Andrea V. Brambilla
The pressure the association was facing following the resignation of not one, but two chairmen, led to this article highlighting some of the shuffling happening behind the scenes through a public video featuring CEO Nikia Wright. began to appear in more forms, including The video was published on the morning of January 30, 2024, deleted for several hours, and then re-posted with minor but significant modifications. ”
“[T]”It is simply false that the National Association of Realtors controls the compensation of real estate professionals,” Wright said in the first video. “NAR does not set fees. It never was and never will be. Period, end of story.”
When the video was reposted hours later, the keywords “never happened” had been edited out. A 1983 study of the residential real estate brokerage industry conducted by the Federal Trade Commission found that prior to 1950, charging less than the standard commission rate violated the association’s code of ethics.
The video was also strange because NAR was not accused in the fee-setting lawsuit. But the failure represented “the real estate industry’s most powerful trade group, which is in turmoil as it grapples with scandal, multiple lawsuits, the resignation of several high-profile leaders and an investigation by the U.S. Department of Justice.” Inman’s Brambilla wrote.
Bracket 2: MLS vs. Portal
“REcolorado will be sold to a private buyer and will sever ties with the real estate agent organization.”
Written by Taylor Anderson
Another major move this year that called into question the nature of the relationship between the Realtor Association and MLS was the sale of REcolorado to a private buyer in September.
The controversial sale, which was finalized after weeks of delays and threats between MLS and some subscribers became public, resulted in a separation between REcolorado subscribers and NAR-affiliated associations. , and provided a model for how other MLSs can separate from real estate agent organizations. future.
REcolorado was sold to MAZL, LLC, a company registered to Joseph E. Burks, president of Colorado Stock Rights and an associate member of the South Metro Denver Association of Realtors.
“Real estate agent files lawsuit against Move and NAR over ‘fake lead’ scheme”
Written by Marian McPherson
Competition among real estate portal sites has intensified this year, with CoStar in particular spending big bucks to step up its marketing in hopes of taking the crown. But as competition has increased, so has increased scrutiny of how the portals operate, with a group of real estate agents claiming that Move, the parent company of Realtor.com, has accused the company of sending unvetted and fraudulent leads through websites such as Realtor. The company was harshly criticized in a class action lawsuit for selling . Com.
NAR and lead generation technology platform Opcity were also named as defendants in the lawsuit for allegedly engaging in the sale of fake leads. The lawsuit alleges that senior executives and other executives at News Corp, Move, Realtor.com, and NAR were also aware of growing dissatisfaction with the quality of agents’ leads and “intentionally and consciously addressed that concern.” He claims that he ignored the incident.
On December 10, the defendants moved the lawsuit from Los Angeles County Superior Court to federal court, arguing that it is a class action.
Bracket 3: Clear cooperation policies and practice changes
“Refkin: NAR’s apparent cooperation violates ethics rules and state laws.”
Written by Robert Refkin
This fall, most real estate industry executives made their positions clear on NAR’s controversial clear cooperation policy. One of the most vocal opponents of the emerging policy is Compass CEO Robert Refkin. In this widely read opinion piece for Inman, Levkin argues that the Chinese Communist Party has forced agents to violate the NAR Code of Ethics and state law, unfairly restricting consumers’ choices about how their homes are sold. claims to be doing so.
The policy stipulates that agents must list a home on the MLS within 24 hours of putting it on the market for sale, which is often the case in the luxury sector (one of Compass’ specialties). This may be unpleasant for the individual customers visiting. Compass has a large network of agents across the country, so it’s easy to see why selling homes within that network alone can be attractive to maintain in-house sales. But the Justice Department is also investigating the policy, and Mr. Refkin happens to be on the same side of the powerful government agency that keeps a close eye on the industry.
“Michael Ketchmark: We’re watching your every move.”
Written by Andrea V. Brambilla
Ahead of a major change in industry practices that goes into effect on August 17, real estate professionals have been scrambling to ensure they have all approved documents and conversations with new clients. With new contracts being rolled out, canceled and re-rolled in some regions, some agents were left wondering if they were really ready for the big day.
In addition, lawyers for the seller-plaintiffs in the legal battle between NAR and industry players have indicated that they intend to continue to apply pressure, and that the industry needs to prepare for it.
Michael Ketchmark, lead attorney for the plaintiffs in the Sitzer case Mr. Inman said of the Barnett case: “If anyone thinks they can avoid this settlement agreement and the law by creating a new form or hiding this collaboration with a new website, they are wrong. If we feel that such behavior is being used as a way to avoid this, we will promptly take legal action.”
Bracket 4: Malicious Act vs. Intermediary
“Brother Alexander indicted in federal court on sex trafficking charges.”
lillian dickerson
In 2024, multiple people in the real estate industry were hit with lawsuits over allegations of sexual assault, sexual harassment, and kickback schemes. But the most shocking allegations came to light in the final month of the year when the once-popular luxury brokers, brothers Oren and Tal Alexander, were indicted by the federal government on sex trafficking charges.
The brothers have been under increasing pressure for months, with multiple lawsuits filed against them since last spring on charges of sexual assault, rape and drugging women. The brothers continue to deny the charges against them, even though dozens more alleged victims have come forward with charges against them.
As the days passed, their intermediary, Official Inc., began to go bankrupt, and they became the subject of an FBI investigation and were sued by their white label company, Side Inc., and on December 11th, He was arrested on charges of aiding and abetting an investigation. “operating a sex trafficking scheme,” the federal indictment states.
“Keller Williams’ former representative files lawsuit over changes in profit distribution”
Written by Andrea V. Brambilla
A handful of brokerages have introduced or modified profit sharing programs in 2024, including Side, eXp Realty, and Keller Williams.
However, when KW made changes to its program, KW’s agents were less than enthusiastic, and last spring three former agents filed individual class-action lawsuits against the franchisor.
In August, KW announced a policy change that would reduce profit sharing from 100 percent to 5 percent for vested agents who joined the company before April 1, 2020 and are in “aggressive competition” with KW Securities. Voted yes. The company also sent a letter to agencies affected by the policy, informing them that they have six months to reinstate before their profit sharing is reduced.
A few months later, KW abandoned its plans to make the profit sharing changes retroactively in response to the backlash it received. Currently, agents who joined before April 1, 2020 can collect 100 percent of their profit share even if they go to a competing brokerage. In October, the former agents who filed the lawsuit with KW reached a settlement to resolve the lawsuit.
Email Lillian Dickerson
