A lot of agents get all in a bunch when they hear the mispronunciation of the word Realtor. Now, what is the word Realtor? Realtor is a brand name for an organization called the National Association of Realtors. They came up with this name because they wanted to bring together a group of people who are in the same industry of helping people buy and sell homes, and that can be a very competitive space.

Everybody is individually representing people, so all the agents become a thousand individual businesses all working against each other if they don’t find a way to cooperate. And so, the National Association of Realtors was created with this idea that all of us can come together and work together to create a win-win situation for our clients.

The Purpose of NAR

If I’m helping somebody to buy a home they need to find a seller who’s willing to sell the home. So every one of these transactions has two people in it, a buyer and a seller, and they both might be represented by a real estate broker, the buyer broker and the seller broker. If they know how to communicate and talk to each other then we can facilitate these transactions and make the whole market flow a little bit smoother.

So that’s the idea. The National Association of Realtors was founded almost 100 years ago on this idea of bringing us professionals together to make the industry flow smoother for all of us. And part of that, once they became a big organization, turned into some political lobbying. They have a large lobbying arm where they work with the government to make sure that the laws are favorable to property rights and helping people to own their own property, buy their own homes to have owner occupied homes instead of renting all the time.

National, State, and Local Associations

And so there’s a lot of really good things that the Association of Realtors does. The National Association is one big organization, but they’re affiliated with a lot of smaller organizations that are State Association of Realtors, and then there’s local Association of Realtors. If you get your real estate license you’ll probably sign up with one of these local Association of Realtors, and then you will also be a member of your state association and also be a member of the National association. So, you can participate on each one of those levels. The local association will give you the stuff that’s most relevant in your day to day business, the state association will help with things that are kind of broader. Like in Utah, for example, the Utah Association of Realtors provides attorney prepared contracts that they’ve created to kind of help you with situations where the government doesn’t already have an approved contract for that.

And on a national level, the National Association of Realtors provides big service. They have big designations and certifications to help you get better educated as a real estate professional. And, they lobby on a federal level for those laws that affect property rights for everybody. So the Association of Realtors is doing a lot of things to help the market.

Now, there are some downsides to this, a big organization like this with a lot of money involved, especially on a federal level. You know, there are over one million Realtors and all of them are making money. So add all that together and you have millions of dollars to work with. When you have money this size, a lot of times the same problems as with any organization will happen in the Association of Realtors.

The Human Factor in Real Estate

We are all humans, we’re all people, we’re all fallible. Sometimes we make mistakes, and when there’s a lot of money on the line, sometimes we make mistakes that are selfish, that aren’t in the best interests of the whole organization, that are best for us. And you see some of the other fallacies with things like the mindset that if we have the money then we think we deserve it, and that the people who don’t have it don’t deserve it.

You start to see lobbying for laws that follow those trends based on those incorrect ideas. But when we talk about the idea of a Realtor, when someone says that they’re a Realtor, legally, that’s a trademark term based on the Association of Realtors. You have to be a member of the National Association of Realtors, NAR, to use the term Realtor.

Real Estate Becomes Our Identity

Now oftentimes it’s mispronounced, and sometimes agents will take a front and say, “That’s not what it is, it’s ‘Realtor’,” And you can see based on that that they’ve taken this as part of their identity.

So a real estate agent, for example, usually works on commission. And so, every deal that they put together is a big payday. Now, they put a lot of work in before they get that pay, then they get the commission at the end. So it’s kind of a risky industry to work in, but if you can do it well it can be very rewarding.

Lots of money, lots of satisfaction, and that satisfaction being of something that you’ve gone out and achieved for yourself, you’ve gone out and obtained that client and closed that sale and handled that transaction, then you’ve gone out and done it again and again, these are things that really build a lot of pride. It really makes us feel good about what we’re accomplishing individually.

And then, when you join an association like the Association of Realtors and meet a bunch of other professionals who are also doing it on their own, we kind of share that pride together. That’s where this identity of a Realtor really becomes strong. And it’s really cool to have a business organization where you can feel like you’re part of something really big and you can see some of the great things they’re doing with property rights and things like that.

The Code of Ethics

Another great thing the association has is what they call the code of ethics. Real estate agents who are members of the National Association of Realtors have a written code of ethics that they need to adhere to to stay members of the association. And so, in that way, they’re raising the level of ethical behavior to help Realtors behave in a way that’s more in the benefit of their clients, of other people in the profession, and members of the public.

And so this code of ethics is a really cool thing that the Association of Realtors has. It’s a benefit to everybody to have those good things coming from the association. Now, the association is fallible because the people in it are just people, and we make mistakes sometimes. But the question of, “Should I support the Association of Realtors and should I correctly pronounce the term Realtor?” is kind of an individual decision where you can look and see, what’s the benefit that’s going on in the world with the organization and what’s the possible downside?

Ethics in Real Estate

Now I, personally, have a really strong drive to advance the ethical behavior in our industry. That’s my passion, that’s what I like to help with. So I’ve been involved with the Association of Realtors to help promote that, I’ve been on the committees where they talk about that, where they rewrite it, where they hold people accountable to the code of ethics. And so, that’s something that I’ve taught about. That’s something that I’ve written courses about. That’s something that I bring up all the time.

In fact, that’s the main purpose of this channel, to promote ethical behavior in real estate and in business in general. That’s the part that I’m really passionate for, and I’ve been involved with the Association of Realtors to help promote that. Now I, personally, found that in the roles that I was in that it felt like the focus of the organization was more on business and dollars than it was on ethics, so I took a step back from those roles and I’ve focused myself again on the ethics, and building up that type of behavior. The good side of the industry.

Promoting Ethical Real Estate

If you’re interested like me in promoting the ethical side of real estate, I would encourage you to do three things.

  1. Talk about it. Let’s say in a positive way, not in a negative way, but on social media when you’re talking with other professionals be like, “Hey yeah, let’s work together to make this a good positive ethical industry!”
  2. If you do see someone being unethical, then if it’s specifically against the Realtor code of ethics and they are a Realtor, talk to them about it or report it to the association. Then the association can take steps to make sure that people improve their behavior and get back in line.
  3. If you find yourself in a situation where you’ve done something that you shouldn’t have, then own up to it. Admit what you’ve done, try to be better, you know, try and make it better for anyone that you’ve hurt and try and be the change that we need in the association, in the real estate market, and in the world.

Maybe together we can truly make this world a more ethical place and a better place for everybody. That’s my hope.