Local Realtors reject dues increase: Who can blame them?

Given the present economy, how would you feel if your professional organization bumped your dues, in part to help lobby politicians in other states?

Puget Sound area Realtors are giving a cold shoulder to a proposed $40 dues increase from the National Association of Realtors in order to fund a Political Survival Initiative.

Who can blame them? The boost would move a member’s minimum annual payout from $80 to $120.

Mike Eliason, association executive and government affairs director for the Kitsap County Association of Realtors, said his group was the first to take up the dues hike issue.

“While we appreciate the national association’s efforts, we opposed because of the potential impact on our members,” Eliason said.

Perhaps the most common reaction to the dues increase was voiced by SeattleKing County Realtors president Kirsten Greenlaw in a letter to D’Ann Jackson, a local National Association of Realtors director. The letter reader:

“So why do we need a national dues increase that promises to return 70 percent of the money to state and local boards for enhanced local advocacy efforts? We want NAR to advocate the mortgage interest deduction with Members of Congress, not help elect the Governor of Alaska.”

The mortgage interest deduction, along with the capital gains exclusion on a primary residence, availability of funds for jumbo loans and the streamlining of the short-sale process are the key national topics most Realtors wanted addressed with their dues, according to a 2010 survey.
Mike Flynn, NAR director from University Place, said the Tacoma-Pierce County Association of Realtors had not taken an official stance on the matter. According to the association’s Wanda Coats, it will be discussed at tomorrow night’s board meeting.

A decision on the dues increase is scheduled to be decided at NAR’s mid-year meetings, May 9-14, in Washington, D.C.

How does the nation’s largest trade association allocate member dues? According to NAR’s annual report, member dues are $80 for 2010 and 2011. Of that total, $23 is used for legislative regulatory advocacy, $15 for consumer and member relationship building, $15 for state and local association services and support, $10 for economic and technological research, $7 for code of ethics, legal policy, and enforcement; $5 for publications (Realtor Magazine and Realtor.org), and $5 for commercial and international alliance partnerships.

Last year, a Supreme Court case changed the way cash can be used for political purposes, sparking NAR to ask its members for more money in order to lobby politicians to be more real-estate friendly. Hence, the birth of the Political Survival Initiative campaign.

NAR has approximately one million members. Its membership peaked at 1.36 imillion n 2006.

In her letter, Greenlaw wrote that the huge dues increase comes at a difficult financial time for all. Many licensees are moving to non-member brokerages in order to save money during a down market and smaller, independent brokerage owners are choosing to end their Realtor memberships because of the costs.

According to the Seattle-King County Realtors (SKCR), its market averaged over 38,000 closed sales per year from 2003 to 2007. Since then, closed sales have decline approximately 45 percent. In addition, the association’s full-time membership has declined 38 percent from a peak total of 9,100 in 2007.

In a letter dated April 12, NAR’s executive committee told the association’s board of directors that both the $40 dues increase and the reallocation of its public awareness campaign funds were was critical:

“We believe both programs are so vital to our survival that we are unwilling to choose one over the other,” the executive committee wrote.

SKCR said it had hoped for more dialogue before the new $40 proposal was circulated. Members say that any new dues increase could push more members away. They also pointed out that NAR membership was not a requirement to be an active member in the Northwest Multiple Listing Association, a network that includes more than 22,000 real estate salespersons in 21 counties in central and western Washington.

According to Greenlaw “we need an Association that can retain its current members and also has a reasonable expectation to grow its membership as the market recovers. The NAR proposal is not a plan that allows for that in the present market situation.”

Both Kitsap and SKCR endorse a compromise that includes indentifying the elements “for which NAR is ultimately responsible,” and converting public awareness funds to cover other issues and waiting until after NAR’s 2013 budget cycle to add state and local funding initiatives.

Maybe by then, the local housing market will improve and all agents can earmark more funds to help NAR elect the Governor of Alaska.

Tom Kelly’s book “Cashing In on a Second Home in Central America: How to Buy, Rent and Profit in the World’s Bargain Zone” was written with Mitch Creekmore, senior vice president of Houston-based Stewart International and Jeff Hornberger, the National Association of Realtors’ international market development manager.