With today’s NAR Board of Directors policy decisions, a prominent policy passed that will garner a great deal of attention, as it pertains to NAR’s role in Realtor ratings.
NAR will now develop an industry standard for models to allow consumers to fairly and more accurately evaluate Realtors. The framework has not yet been developed, but newly installed NAR President, Chris Polychron will lead a team that creates that framework to bring before the Board at the next meeting at NAR Midyear next May.
The objective of the policy is that “NAR should determine criteria relevant to consumers, combining it with criteria that is relevant to the REALTOR®’s business practice, to enhance more accurate, professional and fair ratings of REALTORS®. This will benefit both consumers and REALTORS®. To be clear, NAR itself will not rate its members. This proposal puts forward the goal of a model or industry standard which other ratings sites would be encouraged to use so as to more accurately rate REALTORS® should they so desire to do so.”
Further, the approved policy reads, “Because of the immediate need to standardize a model for fairer and more accurate ratings, given the fact that there are more than 50 such ratings systems already in existence on other third party sites, and given the fact that all aggregator real estate sites are contemplating and/or putting in place a rating system, a Work Group was appointed to address the issue. (Refer to Exhibit E, pages 1-3, for the Work Group’s report.)”
Rating vs. evaluating Realtors
Current NAR President, Steve Brown strongly asserts that this new industry standard will be much more comprehensive than rankings, which is precisely why they Board struck the word “rate Realtors,” altering it to read, “evaluate Realtors.” The distinction is important and will frame this topic going forward.
“The consumer is already rating us from some 50 portals,” Polychron said, adding that they simply want to establish industry standards, agreeing with us that this is very similar to NAR developing standards for real estate listing data through RETS (The Real Estate Transaction Standard).
Subjective terms in the policy text
One of the difficulties in understanding the policy is that again, it is simply a framework, a stated objective. The details are not even on a drawing board anywhere, rather an idea has been approved for development.
That said, one of our sticking points was some of the subjective language used in the objectives. See if you can spot the subjective terms in the original proposal for what the rating standards may include:
- The REALTORS® market area, and level of local market knowledge, including but not limited to the community, schools, and transportation.
- The REALTORS® portfolio of sold properties: property addresses, property type and sold prices where available.
- The REALTORS® licensure and credentials.
- The REALTORS® involvement in civic, charitable, and community involvement.
- The REALTORS® areas of real estate expertise and specialization.
- A link to the REALTORS® real-time contact information, including a recent photo.
- The REALTORS® current brokerage office information: location, contact information, and license number.
- Languages spoken.
- The number of years of membership in NAR.
- The REALTORS® level of education, including in the areas consumers value.
- Ability for consumers to post reviews and for REALTORS® to respond to them.
- The REALTORS® general interests.
How does one offer a standard for determining expertise? Interests? Philanthropy? While this is simply the foundation for further review and framework, this is extremely tricky, but NAR has to get involved based on how widespread evaluations already are. Brown tells us that to determine expertise, they will use a combination of things like “certifications, linguistic talents, education, so the consumer really gets a full notion of who they deal with. It’s a very holistic approach.”
What is realtor.com’s role in all of this?
Let’s go back to the mention of the Work Group on the topic. Take a look at what the Work Group discussed. Dismiss the fact that the phrase “ratings” is peppered throughout, because the final policy approved uses the term “evaluate.”
Does this framework remind anyone of anything? It sounds a lot like the public and private post-AgentMatch Advisory Board discussions to me.
So what is realtor.com’s role in all of this? Officially, they’re a third party vendor like any other and would theoretically follow the rules if they re-initiated Realtor evaluations, but NAR leadership told us today that they are “relatively certain they [realtor.com] are developing a ratings system.”
When pressed, Brown said, “if and when agent evaluations are launched by realtor.com, [their role will be to] follow the guidelines” set forth in the standards to be fleshed out and approved next year.
It’s no secret that realtor.com is sitting on all of this technology and lessons learned from AgentMatch, so will they pull the trigger and lead this space by being the first to adhere to the new standards, will they simply be part of the discussion in establishing the standards based on their deep interaction with NAR members on the topic, or will they be classified alongside every other portal offering ratings, reviews, and evaluations? Time will tell.
As of publication, realtor.com is unable to comment (executives are all traveling from the aforementioned conference), but we will update this story as more becomes available.