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Following Day 1 of voting in Inman’s News Knockout of 2024, readers decided which top stories of the year have advanced to the Elite Eight round of voting.
Races between stories about NAR and the American Real Estate Association, the three-way agreement and MLSs, and portals and commissions were neck-and-neck throughout the first day of voting. But by Tuesday morning, reader preferences for NAR, MLSs and portals pulled through victorious.
Meanwhile, stories about the commission lawsuits settlement, scrutiny over industry practice changes and alleged bad behavior by luxury brokers emerged as winners by a landslide in their respective brackets.
Which stories will advance to the Final Four top stories of the year? Only Inman readers can decide.
Bracket 1: Commission lawsuits settlement vs. NAR
“NAR agrees to sweeping changes in $418M commission settlement”
By Taylor Anderson
All eyes were on the National Association of Realtors this year as the association announced its $418 million proposed settlement of the antitrust commission lawsuits that had rocked the industry for the last few years. The settlement, which NAR will be paying out over the next four years, also stipulated a series of industry practice changes that agents, brokers, associations and MLSs had to put into effect by Aug. 17, 2024.
Among them, NAR agreed to not create rules that allow listing agents to set compensation for buyer brokers. The association also created a new rule prohibiting offers of compensation from appearing in the MLS. Buyer brokers who are MLS participants would also be required to enter into a written representation agreement before touring homes.
The terms of the settlement fundamentally changed the way real estate professionals view their roles as salespeople and advisors, and has already started to impact the way in which consumers view the industry, early Inman Intel data shows.
“NAR CEO Nykia Wright appears — and disappears — in ‘odd’ new video”
By Andrea V. Brambila
The pressure the association was facing following the resignation of not one, but two presidents began to show in more ways, including in this story that highlighted some of the shuffle happening behind the scenes through a public video featuring CEO Nykia Wright. The video was publicly posted on the morning of Jan. 30, 2024, removed for a few hours, then reposted again — with a slight, but important, modification.”
“[T]he notion that the National Association of Realtors controls what real estate professionals get paid is wholly untrue,” Wright said in the initial video. “NAR does not set commissions. It never has, and it never will. Period, end of story.”
Hours later when the video had been reposted, the key phrase “it never has” had been edited out. Before 1950, it was against the association’s code of ethics to charge less than a standard commission rate, according to a 1983 study by the Federal Trade Commission called “The Residential Real Estate Brokerage Industry.”
The video was also odd because NAR had not been accused in any lawsuits of setting commissions. But the blunder was representative of “the real estate industry’s most powerful trade group in turmoil, fighting scandals, multiple lawsuits, the departure of several high-profile leaders and an investigation by the U.S. Department of Justice,” Inman’s Brambila wrote.
Bracket 2: MLS vs. Portals
“REcolorado sold to private buyer, cutting ties with Realtor orgs”
By Taylor Anderson
Another big move this year that called into question the nature of the relationship between Realtor associations and MLSs was the sale of REcolorado to a private buyer in September.
The controversial sale, which closed after weeks-long delays and threats between the MLS and some of its subscribers were made public, created a separation between REcolorado’s subscribers and associations affiliated with NAR, offering a model for how other MLSs might separate from Realtor orgs in the future.
REcolorado was sold to MAZL, LLC, a company registered to Joseph E. Burks, president of Equity Title of Colorado and an affiliate member of the South Metro Denver Realtor Association.
“Realtors file suit against Move, NAR over ‘fake leads’ scheme”
By Marian McPherson
Real estate portals turned up the heat in competing with one another this year, with CoStar in particular shelling out major cash to level up its marketing in a bid for the crown. But as competition grew, scrutiny over how portals operate also intensified, with a group of Realtors coming down hard on Realtor.com parent company Move in a class action lawsuit that alleged the company had sold unvetted and fraudulent leads through its websites, including Realtor.com.
NAR and lead generation tech platform Opcity were also named as defendants in the lawsuit for their role in allegedly selling the fake leads. The suit claims that senior execs and other members of management at News Corp, Move, Realtor.com and NAR also knew about agents’ growing discontent with lead quality and “willfully and consciously” ignored the concerns.
On Dec. 10, the defendants moved the lawsuit from LA County Superior Court to federal court because of the suit’s class-action status.
Bracket 3: Clear Cooperation Policy vs. Practice Changes
“Reffkin: NAR’s Clear Cooperation breaks ethics code, state laws”
By Robert Reffkin
This fall, most real estate industry executives made their stance on NAR’s contentious Clear Cooperation Policy known. One of the most vocal opponents of the policy to emerge is Robert Reffkin, CEO of Compass. In this widely read opinion piece for Inman, Reffkin argues that CCP forces agents to go against the NAR Code of Ethics and state laws and unduly restricts a consumer’s choice in how their home is sold.
The policy stipulates that agents must list a home on the MLS within 24 hours of publicly marketing it, which can be a turn-off for more private clients, who often turn up in the luxury sector (one of Compass’ areas of specialization). Since Compass has a large national network of agents across the country, it’s easy to see why simply marketing homes within their network would be attractive, to keep sales within the firm. But with the DOJ also investigating the policy, Reffkin also happens to be on the same side of a powerful government agency that is closely watching the industry.
“Michael Ketchmark: Every move you make, we’ll be watching you”
By Andrea V. Brambila
In advance of major industry practice changes that went into effect on Aug. 17, real estate professionals scrambled to ensure they had the approved paperwork and new client conversations all lined up. As new contracts in some locales were rolled out, reversed, and rolled out again, it had some agents on edge, wondering if they were truly prepared for the big day.
On top of it all, the seller plaintiffs’ attorneys in the legal battle against NAR and industry players suggested that they would continue to keep the pressure on, and that the industry should be ready for that.
Michael Ketchmark, the lead counsel for plaintiffs in the Sitzer | Burnett case told Inman, “If anyone thinks they’re going to be able to avoid the application of this settlement agreement and the law by creating some new forms or hiding this cooperation on new websites, they’re wrong. If we get any sense that people or corporations are doing that out there as a way around this, we plan on taking swift legal action.”
Bracket 4: Bad Behavior vs. Brokerages
“Alexander brothers charged with sex trafficking in fed indictment”
By Lillian Dickerson
Several parties in the real estate industry were hit with lawsuits in 2024 over allegations of sexual assault and sexual harassment, kickback schemes and more. But the most shocking claims were revealed in the final month of the year when once hot-shot luxury broker brothers Oren and Tal Alexander were federally indicted on charges of sex trafficking.
For months, the brothers faced increasing pressure as multiple lawsuits were filed against them, starting last spring, with allegations that included sexual assault, rape and drugging women. The brothers continue to deny the allegations against them, even as dozens of additional alleged victims came forward with claims against them.
As the months went by, their brokerage, Official, began to crumble, they became recipients of an FBI probe, were also sued by their white-label firm, Side, and, on Dec. 11, were arrested for facilitating a “long-running sex trafficking scheme,” according to a federal indictment.
“Former Keller Williams agents sue over profit share changes”
By Andrea V. Brambila
A handful of brokerages introduced or modified their profit-sharing programs in 2024, including Side, eXp Realty and Keller Williams.
But agents at KW did not take too kindly when the company made changes to its program, with three former agents filing separate class-action lawsuits against the franchisor last spring.
In August, KW voted to change its policy so that vested agents who joined the company before April 1, 2020, and “actively compete” with KW brokerages would have their profit share amount cut from 100 percent to 5 percent. The company also sent out letters to those agents impacted by the policy, giving them notice that they had six months to return before their profit share would be cut.
A few months later, KW abandoned its plans to make the profit-sharing changes retroactive, seemingly in response to the backlash they received. Now, those agents who joined the company before April 1, 2020, are still able to collect 100 percent of their profit share amount, even if they go to a competing brokerage. KW and the former agents who sued them reached a settlement to resolve the lawsuits in October.
English (US) · 