Going It Alone!
I'm a Water Horse in a Fire Horse year...
After 40 years, I became a non-REALTOR.
Friends watched me struggle last year with all the drama that NAR and the lawsuits put me through as an Arizona real estate Broker and real estate school owner, and so, when one of my dear friends finally told me to “do it”. I did it.
In January of 2026, I joined Phoenix Association’s non-REALTOR access to ARMLS which provides attorney written forms and uses Jointly as the alternative to Transaction Desk used by the REALTORS. There is definitely a learning curve and my agents and I discussed different ways we would handle the transition. Happily, Jointly offered to do an education session for us and we will look forward to their guidance.
Why did I disconnect from NAR, AAR, Phoenix Realtors, Sedona Verde Valley Realtors after 40 years of membership? I tried to think of anything over the last 2 years where any of these entities helped me make my company better, make the real estate experience more ethical, or truly advocate for private property rights. I could think of few. Between news of sexual harrassment at NAR, the many lawsuits involving “inflated” compensation to agents, lawsuits asking disclosure of compensation, NAR’s requirement that as a REALTOR, I was required to join NAR, state association, and local association (the 3-way agreement), and last but not least, a requirement by the local association to be a member of the MLS. Then there is the CCP! Sorry, the Clear Cooperation Policy!
Since August of 2024, the Sitzer/Burnett v NAR settlement has required a buyer broker agreement. Me? I have represented buyers since the old “subagency” days. Frankly, I never understood NAR’s subagency: “a cooperating agent working with a buyer but representing the seller's interests, requiring honesty towards the buyer but owing fiduciary duties to the seller.” I just could not understand how I could have people staying at my house for a weekend, showing them properties, and finding them a house to buy, but NAR said they were only a “customer” to whom I owed no fiduciary duties…frustrated one day, I asked my broker how I could represent my best friend as I would represent family members. She said to get an okay in writing from the listing broker. I did. That was about 6 months after I was licensed in 1986. After that I seldom did subagency, even though there was no REALTOR/MLS way to do buyer representation until the early ‘90s. So, my question to the REALTOR family has always been: “Why didn’t you make buyers pay their agents when you espoused buyer representation?” The answer has always been: “Lenders won’t let buyers include commission payments when they get a loan.”
Let’s look at that for a minute.
If the buyer pays $300,000 for a home, gets an 80/20 loan, the seller gets $300,000 for his/her home. Right? And of the NET to the seller there was a deduction of the compensation paid to their agent who was sharing it with the buyer’s agent. Sellers accept an offer depending on the net amount they finally receive. The lender loaned on 80% of the $300,000. The buyer’s compensation was “baked” into the purchase price. The seller’s broker is paying the buyer’s broker, according to the lender.
Fast forward to August 2024 and the Sitzer/Burnett settlement which requires the use of a buyer broker, negotiated agreement between agent and the buyer prior to showing a property. Many buyers believe that the seller has always paid the buyer broker compensation and many are not willing to pay it directly to their buyer agent. Some buyer’s don’t have the resources to pay their agent directly. Why then can’t the buyer’s broker’s compensation be shown on the contract and settlement statement as a seller concession if the seller is paying the compensation directly to the buyer’s agent as a contract concession? Lenders won’t allow it even though the numbers will all be the same.
My question has always been: Why didn’t NAR lobby for this change over the years since 1992? Another question is: Why do real estate companies continue to offer buyer broker compensation? After Sitzer/Burnett, the broker cannot show a “co-broke” in MLS, but can put the amount on a yard sign, in any advertising, on the table at an open house or blast it all over social media. I hear agents telling sellers that offering to pay the buyer broker’s compensation will bring them more showings. What changed? Has agent compensation gone down? Not noticably, and in some cases it has increased.
My REALTOR family let me down.
Lifestyles of Arizona, has been my brokerage in Sedona since 2006. Prior to that I have had brokerage firms in Phoenix, Esplanade Realty, and Hawaii, how2hawaii realty. My business plan has always included negotiable compensation for both sellers and buyers, marketing that meets the needs of the seller, services for a buyer in order to find their new home, and negotiated compensation dependent upon the work my brokerage will do for our client. Our client.
That should say it all, but it doesn’t. It would be nice to be able to do just what our client dictates. MLSs have rules. There’s a current argument across the USA about “private listings,” the timing of putting a listing in MLS, whether or not a buyer has the right to see any and all properties for sale, if the seller has the right to do a private sale, and how the property is put into the MLS. A brokerage must put a listing into MLS within 24 hours of taking the listing. There are rules to keep it off the market and the seller generally must sign an MLS statement form.
Now the states are getting into the legislative mood to further determine how brokers must offer properties for sale. Wisconsin has already passed a law which makes the seller sign a state-prescribed disclosure and opt-out form which warns the seller that keeping the property off the market may negatively affect their sales price. Washington state is planning to enact a similar law.
Many states have legislated the use of a buyer broker agreement. Before the Sitzer/Burnet lawsuit, the following states legislatively required buyer broker agreements: Alaska, Arkansas, Georgia, Idaho, Maryland, Minnesota, Missouri, Nebraska, New Hampshire, North Carolina, North Dakota, Pennsylvania, South Carolina, Utah, Vermont, Virginia, Washington, Wisconsin. Since the settlement: we can add Indiana and Oregon. California has taken, IMHO, a more reasonable statute: Effective January 1, 2025, all buyers' agents in California will be required to sign a buyer-broker representation agreement with their buyer clients as soon as practicable, but no later than the execution of the buyer's offer to purchase real property.
So, how has the REALTOR family failed me?
When I began my long and loved real estate career, on any corner there were 2 “filling stations” and 2 real estate offices. Along came the Internet and the public became more sophisticated. Multi-pump gas stations replaced the “filling station” and the Internet replaced many real estate offices. It was exciting for both the consumer and agents. NAR and the MLSs continued to work under old customs and continuted to find ways to keep compensations as close to home as possible. Real estate companies widened their financial portfolios by having interest in mortgage companies, escrow/title companies, and other ancillary services (affiliated agreements required in transactions). The consumer has always wanted “one stop shopping.”
Slowly, NAR lost MLS as part of their stemwall. In 1994, NAR allowed associations to decide to allow non-members to access the MLS; but, not until 2026 was the NAR policy modernized and fully implemented. Control slips away. The requirement to be a REALTOR member is gone.
In the ‘90s, NAR then set its sail on education and certifications. Two (2) days of classes makes an agent an Accredited Buyer Representative. Does it? Other certifications only require 1 or 2 days of prescribed classes as well. To use the ABR designation on flyers, websites, or business cards, the agent must pay an annual fee to NAR’s Center for REALTOR Development or not use the designation. IMHO, it would be better to also require the user to take an annual update on buyer brokerage. Think about it! Updating buyer broker agents since the ‘90s…perhaps no lawsuits would have hit the courts.
Fast forward to a non-REALTOR’S future. Neither me, nor my agents have changed in our ability to be the best that we can be. We are still ethical, customer-service-oriented, well educated, and advocates for our clients. We haven’t changed. The real estate industry has changed.
We cannot wait for the day when we independent brokers can pick and choose the different platforms which best fit our clients, instead of being relegated to the use of the MLS first and then they decide where our listing goes next. We know it’s a pipe dream, but we can hope!!
Remember, I’m a water horse in the year of the fire horse!