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The National Association of Realtors is considering changes to its rules governing harassment and speech, even as the second most populous U.S. state considers a new law that could theoretically come into conflict with NAR’s current policies.
The potential changes are outlined in an agenda for the organization’s upcoming Legislative Meetings, which run from May 31 to June 5. An appendix to the agenda states that NAR is conducting a risk assessment of its policies, and that during the process, it identified part of its Code of Ethics and one of its policy statements as “sources of potential risk” or, in other words, legal liability.
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The Code of Ethics rule in question right now bars Realtors from using “harassing speech, hate speech, epithets, or slurs based on race, color, religion, sex, disability, familial status, national origin, sexual orientation, or gender identity.” Meanwhile, the policy statement indicates that Realtors can face disciplinary action for breaking the Code of Ethics.
The changes to these rules would include adding a specific definition for what counts as “harassment.” They would also tweak the applicability of the Code of Ethics: New language would encourage Realtors to follow the code’s principles “in all of their activities,” but disciplinary action would be reserved for violations that took place while Realtors were acting in a professional or business capacity.
The agenda states that the changes are meant to add “clarity” and “to reduce risk to state and local associations and their volunteer leadership.” An NAR advisory board recently weighed the changes, the agenda adds. Additional leadership groups will now get to review the proposed changes, after which NAR’s board of directors will have the option to ratify them.
Kevin Sears
News of the rules changes began circulating online in recent days after NAR President Kevin Sears outlined the proposals in an emailed memo to association directors.
NAR did not respond to Inman’s requests for comment.
In addition to changes regarding speech and harassment, the agenda also notes that NAR is considering rules changes stemming from the Sitzer | Burnett antitrust settlement. Those changes would require Realtors to advise their clients that agent compensation “is not set by law and is fully negotiable,” among other things.
NAR’s proposed rules changes come amid a period of heightened attention on issues related to speech and harassment generally. Part of that attention stems from a charged political landscape that has seen battles over free speech erupt on college campuses and elsewhere.
However, Texas lawmakers are currently considering a bill that would potentially crack down on trade organizations’ speech rules — a bill that has implications for real estate specifically.
Senate Bill 2713 would bar entities like NAR from denying anyone membership in their organization due to race, color, religion, sex, disability, familial status or national origin. That’s fairly standard language, but the bill also would prevent trade organizations from denying membership to a person “because of the person’s exercise of the person’s freedom of speech or assembly, notwithstanding any provision of the association’s or organization’s bylaws.”
The bill also states that someone who is aggrieved by a violation may bring action against the trade organization for damages, which might include court costs and attorney fees.
The Texas bill has not been signed into law yet, though lawmakers have so far responded positively to its language.
The Texas Association of Realtors has said that it is neutral on the bill, and a number of real estate professionals support it.
However, if passed into law, the bill could theoretically impact the execution of Article 10 as it currently exists in NAR’s Code of Ethics. Presumably, NAR’s proposed rules changes are meant to avert a conflict, though it’s unclear how explicitly, or not, the Texas bill factored into the push to update the policies.
Neither the Legislative Meetings agenda nor Sears’ memo explicitly mentions the Texas bill. But Sears’ memo does say that since NAR added the subsection on harassing speech in 2020, “it has become clear that there is ongoing confusion and uncertainty regarding the interpretation and implementation” of the rule. Sears added that, sans updates, NAR might not be able to defend the rule, or even the Code of Ethics itself.
“With 1.5 million members across the country, we need to ensure the specific articles of the Code of Ethics are clear in their language and intent and can be enforced fairly and consistently,” Sears said in his memo. “Without this, the defensibility — and sustainability — of the Code itself is in doubt.”
How exactly any changes play out remains to be seen, and four months into the Trump administration, tension over issues related to free speech have only intensified. However, in his memo, Sears said the organization “is deeply committed to upholding principles of fair housing and equal treatment for all consumers” and that Code of Ethics changes won’t alter that commitment.
“We take any changes to the Code of Ethics very seriously,” Sears added, “and the amendment process is thoughtful and rigorous.”
