Editor’s note: Since the Homestead Act more than 150 years ago, politics, policy and real estate have gone hand in hand. Today, politics and policy are even more central to a vibrant and functioning real estate market. In this special four-part series of stories during an election year, Inman News looks at the relationship between politics and real estate. (See Part 1: Democrats, Libertarians make inroads in housing; Part 2: Housing’s public policy agenda; and Part 3: Realtors have money, masses.)
When John Seymour was appointed to represent California in the U.S. Senate in 1991, Realtors rejoiced. Seymour had political experience as former mayor of the City of Anaheim, Calif. But he knew a lot about real estate, too. He’d owned a real estate development and investment company for nearly 20 years and he’d been president of the California Association of Realtors in 1980.
Realtors who 13 years ago hoped Seymour’s rise in the halls of political power heralded more such events to follow weren’t disappointed. Johnny Isakson, a Republican congressman from Georgia, once owned a sizable independent brokerage company in that state, and was president of the Realty Alliance and a member of the NAR’s exclusive and powerful Executive Committee. Michael Rounds, governor of South Dakota, is a partner in Century 21 Fischer, Rounds & Associates, an insurance and real estate agency in Pierre. Al Mansel, president of the Utah state senate, is CEO of Coldwell Banker Residential Brokerage, an NRT-owned company in that state, and will be president of NAR next year.
And that list doesn’t include the legions of Realtors, mortgage lenders, home builders and other real estate-connected people who hold other political offices throughout the country or serve on local school boards, community planning commissions and the like.
The rising political stars in the Realtor ranks have a close parallel in the boom in Realtor political fund-raising. NAR’s political action fund, one of the richest in the country, has donated $24 million to federal political candidates and causes since 1989 and ranks second in the national only to the gigantic federation of government employees. That means NAR has out-donated the teachers’ association, the trial lawyers association, the American Medical Association and even the Teamsters Union, according to OpenSecrets.org, and that $24 million figure doesn’t include PAC money from hundreds of state and local Realtor associations, mortgage lenders and real estate services providers or the vast sums donated by real estate-connected individuals.
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The explosion of the Realtor population to 1 million-plus people also has meant more money for Realtor PACs, and that has given them even more power in politics. The peer pressure to donate can be considerable, even for those who don’t have association ambitions and connections. And the donations can add up to real money. The San Diego Association of Realtors, to take just one example, suggests five contribution levels that support five different PACs from the $49 “Champion Club” to the “NAR Golden R,” which requires a one-time $5,000 contribution, plus a $2,000 annual renewal fee.
Seymour, Isakson, Rounds and Mansel are all Republicans. That’s not surprising, given that real estate historically has united with Republicans, whose support for housing and commercial development, limits on government regulation, and lower-income, property and capital gains taxes meshed nicely with real estate’s agenda.
But the relationship between real estate and Republican politics isn’t as tight as it once was. NAR has won many of its core political battles over the years; the political system now benefits organizations that lobby heavily on both sides of the proverbial aisle and the real estate brokerage and mortgage lending sectors have matured and consolidated. As a result, NAR today is focused less on such homeowner-friendly issues as the mortgage interest deduction and capital gains taxes and more on perceived threats of new technology and competition. Job one for NAR’s political types is to ban banks from the real estate brokerage business. But telemarketing, junk e-mail and copyright of electronic databases aren’t too far down on the list.
Relationships between Realtors and politicians aren’t a one-way street. Indeed, associations attract politicians like magnets attract metal objects. The trade groups have piles of PAC money, many members, community connections and grassroots organization–all the characteristics politicians seem to like. Prominent politicians’ appearances and speeches at Realtor conventions are one sign of politicians’ fondness for Realtors. U.S. Reps. Rubin Hinojosa (D-Texas), Don Mazullo (R-Ill) and Barney Frank (D-Mass.), along with U.S. Housing Secretary Alphonso Jackson, were on board at NAR’s annual Washington, D.C., midyear governance meetings last month, for instance, while U.S. Sen. Hillary Rodham Clinton spoke at the same venue two years ago.
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