This structure makes the dream of homeownership within reach for more Americans. The commission structure where the listing broker offers to share his or her commission with the buyer broker ensures greater equity and equality for first-time, low-income, and many other home buyers who otherwise couldn’t afford a home and professional representation. If buyers had to pay an out-of-pocket commission to their agent at closing in addition to the price of the home, it would increase their costs and freeze many out of the market.

The associated Multiple Listing Service (MLS) database and system is also designed to incentivize cooperation between brokers who share all their information in one place, providing the best and greatest number of options for buyers as efficiently and transparently as possible. In turn, sellers get access to the largest possible pool of buyers within a market.

There is real value in a structure that levels the playing field for buyers and pays everyday Americans for a critical service. A home is the single largest, most complex purchase most people make in a lifetime. Consumers know they don’t want to go this alone. Even as internet research about a home purchase reached an all-time high of 97% in 2020, nine in 10 people still choose to work with a real estate agent to buy a home. Real estate agents help people navigate complex, data-heavy, and voluminous information, details, and decisions. That includes everything from coordinating with lenders, managing attorney reviews, and advising on zoning to arranging appraisals, serving as a professional negotiator in a highly competitive market, and advising on the latest trends in the local housing market. All that for a median gross income of $49,700 for REALTORS®.

Small businesses participate and thrive because of the cooperative MLS structure. The cooperative broker MLS system makes it possible for smaller brokerages to compete with larger ones through instant exposure and access to the largest, centralized database of residential real estate listings in your market. Because of MLSs, we’re at a point in the market where we’re seeing unprecedented competition among brokers, especially when it comes to service and commission options. That gives consumers many different choices including which customer service approach and broker and commission model they prefer.

This structure is enabled by REALTORS® who go above and beyond to give back to their local communities. In 2020, 79% of broker-owners volunteered their time on a monthly basis and 92% made monetary donations. Meanwhile, 82% of REALTORS® made charitable donations, and 91% of REALTOR® associations conducted a fundraiser for their community in 2020. Over the past 18 years, the REALTORS® Relief Foundation has collected and distributed more than $32 million in relief aid for victims of more than 80 disasters in 39 states and territories, helping more than 13,000 families.

So, beware of the alternative reality being advanced by big money plaintiff’s attorneys looking for a payout and those illegitimately trying to position themselves in the real estate market. What’s real are the everyday real estate agents living and serving in our communities across the country who are helping their fellow, everyday Americans achieve the ultimate American dream.

Source: National Association of REALTORS®

Legislation that C.A.R. is supporting includes requiring implicit bias training for realtors, removing discriminatory language in property records, prohibiting discrimination against people living in affordable housing and repealing Article 34 of the California Constitution. Details of those pieces of legislation are as follows:

Prohibiting Discrimination Against Residents Living in Affordable Housing

Assembly Bill 491 (Gonzalez)-First Hearing Pending: This bill will ensure that multifamily properties provide the occupants of affordable units the same access to common entrances, common areas, and amenities that are available to the occupants of market-rate units and do not isolate affordable units to a specific floor or area.

Uniform Partition of Heirs Property Act (UPHPA)

Assembly Bill 633 (Calderon)- This bill adds California to the list of states that utilize the Uniform Partition of Heirs Property Act (UPHPA). Under current law, if several heirs jointly inherit a property and there is no will, trust or other method of conveying the property at the time of the owner’s death, one heir can go to court to force the sale of the entire property, often at below-market rates. Furthermore, heirs who may be in an immediate need of money have been taken advantage of by predatory persons who buy small shares and then force these below-market sales at which they purchase the property. These forced partition sales have had an outsized negative impact on those in financially disadvantaged groups, more of whom tend not to have wills or trusts. This measure seeks to preserve family wealth by providing a series of simple due process protections to ensure all parties receive their fair share of the inherited proceeds and ensure the best value for the inherited property is obtained. AB 633 passed its first committee hearing, Assembly Judiciary.

Implicit Bias Training for Real Estate Professionals

Senate Bill 263 (Rubio) – This bill now requires a licensee’s continuing education requirement to include a two-hour course on implicit bias training for real estate licensees, including actionable steps licensees can take to prevent implicit bias. It also requires the current fair housing training to include participation in interactive training where roleplay scenarios are used to illustrate live-experiences from the perspective of both a consumer and a licensee. AB 263 passed its committee hearing in Sen. Business, Professions, and Economic Development.

Repealing Article 34

Senate Constitutional Amendment 2 (Wiener, Allen)- Enacted by voters in 1950, Article 34 of the California Constitution requires that any development comprised of “low-rent” dwellings, financed in whole or in part by federal, state, or local government, be approved by a vote of the people in the jurisdiction where the project is located. Article 34 does not just apply to “public housing” but also affects mixed-income developments that often contain units partially “subsidized” by local government. Since 1992, C.A.R. has had policy supporting affordable workforce housing and has sought to advance policies seeking to increase the state’s housing supply. C.A.R. is a co-sponsor of S.C.A. 2, which seeks to repeal Article 34 in its entirety. This bill is pending referral to a policy committee.

If you have any questions about the above legislation, please contact C.A.R. at [email protected].