National Association of REALTORS (NAR)

A BRIEF HISTORY OF THE NATIONAL ASSOCIATION OF REALTORS®

The National Association of REALTORS®, the nation's largest trade association, was founded in 1908 as the "National Association of Real Estate Exchanges."

Three earlier attempts to organize a national real estate group had met with failure. The first effort in 1891, resulted in the formation of the National Real Estate Association, which survived only 19 months. Two subsequent efforts also were without success.

On May 12, 1908, 120 men representing 18 Boards from 13 states and one state association met in Chicago to try again. Their stated objective was "to unite the real estate men of America for the purpose of effectively exerting a combined influence upon matters affecting real estate interests."

The group authorized employment of an Executive Secretary, general counsel and "such other assistance as may be necessary" and also provided for an office for association work. Standing committees, demonstrating the founders' intended fields of activity, were formed and included: Code of Ethics, taxation, state and municipal legislation, and the organization of local exchanges.

In 1916, the organization's name was changed to the National Association of Real Estate Boards," and in 1972 became the "National Association of REALTORS® " and its present logo was adopted.

Throughout its history, the National Association has been working for America's property owners, exerting pressure on government for better housing, improved home financing, the prevention of real estate fraud, community revitalization, fair taxation and encouraging property beautification and protection.

NAR members can be proud of the many key accomplishments along with achievements at every level--national, state and local. Some of the Association's major achievements include:

Making use of the "golden Rule" as its theme, the REALTOR®'s adopted a strict Code of Ethics in 1913. The National Association was only the second business group in the nation to follow the professional of medicine, law, and engineering in the formation and enforcement of a code for its members.
In 1916, Charles N. Chadbourne, a Minneapolis REALTOR®, devised the term "REALTOR®" to identify real estate agents who are members of the National Association of REALTORS® and subscribe to its strict Code of Ethics. The patent office registration of the servicemark, "REALTOR®" and the REALTOR® emblem were approved in 1949. Courts have upheld this designation in every case brought before them.
The principal of "exclusive agency" was established about 1910 and meant that every seller could make exclusive use of a single broker. This concept lead to cooperative selling practices and the establishment of multiple listing services. The public benefits from exclusive agency because only a single fee is due upon the sale of a property, regardless of the number of agents involved in its sale.
After the Great Depression, REALTORS® worked to prevent urban blight from destroying good neighborhoods. In 1939, the Urban Land Institute was formed to concentrate on the problems of urban decentralization and redevelopment. REALTORS® suggested a program for large scale redevelopment by private enterprise. In 1941, major proposals on rebuilding cities were coordinated by the National Association.
The REALTORS®' "Build America Better" program was introduced in 1952 to promote neighborhood conservation. REALTORS® provided expert counseling and helped cities in their efforts to rid neighborhoods of slums. The program was cited in the 1954 Municipal Yearbook of the International City Managers Association, as a major development in the field of housing conservation.

Improvement in the flow of mortgage money has always been a major objective of the National Association. In this respect, REALTORS® provided leadership in the development of the Home Owners Loan Corporation, the Federal Home Loan Bank System, Federal Housing Administration and the Federal National Mortgage Association. Throughout the 1950s, REALTORS® supported credit efforts to help additional families afford housing. They also were involved in liberalizing FHA requirements to make FHA loans available to more people.

REALTORS® have supported floating FHA and VA interest rates since the '50s. A floating rate would make more funds available for government-backed mortgages and result in more equitable closing charges. In 1980, a law was passed with REALTOR® support requiring 10 percent of all FHA loans to have a floating interest rate.

Since its founding, the National Association has opposed excessive government spending and unfair taxation, and remains heavily involved in political affairs to this day.

In 1956, "REALTORS® Week" was introduced. Now known as "Private Property Week," it provides an annual reminder to the public of their constitutionally-protected rights to own, use, and transfer private property.

In 1912, REALTORS® formed a tax committee and succeeded in having the dual taxation on property value and mortgage amount repealed.

REALTORS® worked for the elimination of federal excess profit tax on real estate sales in 1920. The interest paid on real estate mortgages became deductible from income taxes in 1920 through REALTORS® efforts as well. A REALTOR program also was instrumental in obtaining a one-fifth reduction in real estate taxes in 1932.

After World War II, REALTORS® worked to defeat the "quick profits tax" on real estate. They also successfully opposed the imposition of a ceiling on the price of real estate.

In 1952, a six-year campaign by the National Association was brought to fruitation when home sellers were allowed to defer capital gains taxes on the sale of a home, if another home of equal or greater value was purchased within a year. This ruling has subsequently been revised. At present, sellers are allowed two years to buy or build another home.

Expansion of tax relief to the elderly in home sales also was widely promoted by REALTORS®. In 1962, persons 65 years and over were allowed to exclude the first $30,000 of the profit from the sale of their home from capital gains taxes. This amount was increased to $100,000 in 1978 and the age limit was lowered to 55 years. In 1982, the amount was increased to $125,000.

REALTORS® helped defeat efforts to limit deductions for mortgage interest payments in 1976. They continue to lobby against this limitation whenever it is proposed as a means of raising additional tax revenues.

In 1943, the REALTORS® Washington Committee, later named the REALTORS® Political Action Committee (RPAC), was formed. RPAC currently is the largest PAC of any trade association in the nation. In 1982, it raised some $2.5 million in contributions. Citizens benefit from this program by the election of legislators who support the principals of private property ownership and free enterprise system.

The National Association began calling for lower federal deficits and tax relief in 1952 and continue working toward that end. After a massive advocacy campaign in 1980, "The 2% Solution" was adopted by President Reagan as his initial basis of his economic recovery program. The program was designed to benefit the public by reducing federal spending, eliminating federal deficits and bringing down interest rates.

In 1982, a grassroots program, "Paralysis in Government" (PING), generated some two million messages from members and other concerned citizens nationwide. These were sent to Capitol Hill and the White House and demanded a reduction in the federal budget deficit in fiscal year 1983 and beyond. The result of this massive effort was passage of a Budget Resolution that limited the federal budget deficit in fiscal year 1983 to $104 billion, down from a projected $150 billion.

The National Association's nonpartisan voter registration campaign in 1980 resulted in more than 4 million additional voters going to the polls in the 1980 election and was the first such program by a national trade association to be approved by the Federal Election Commission.

The federal government in World War II imposed rent control. Although REALTORS® abided by the law, they worked for its repeal. REALTOR® research has demonstrated that rent control adds to the shortage of apartments and prevents the renovation of units.

In some areas, the fight continues today. REALTORS® participate in task force teams to assist localities in defeating rent control initiatives. REALTORS® also assist in the creation of the Rental Housing Industry Coalition, consisting of national organizations with similar concerns regarding rent control and the rental housing industry.

With the addition of 400,000 sales agents in 1972, the National Association of REALTORS® became the largest trade association in the country. Three living presidents, Nixon, Ford, and Reagan, have addressed REALTOR® meetings. Today, membership is composed of more that 600,000 REALTORS® who are brokers or salespeople, and REALTOR®-Associations, a membership category for salespeople. Members belong to one or more of the 1,864 local boards of REALTORS® located in all 50 states, Guam, Puerto Rico, the Virgin Islands and the District of Columbia.

In the 1990's, the Association continues to provide a facility for education, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right of free people to own and use real property.

NAR Provides...

The REALTORS® Code of Ethics
One membership meeting and an annual convention
REALTOR® Magazine
World's largest real estate library (312) 329-8292)
Fax-on-Demand Information Service (402) 351-9922)
Marketing and educational products
Legal action fund for Boards and brokers
A discount on Cadillac purchases (1-800-325-4642) (For REALTORS® only)
Legislative representation at the federal level

NAR AFFILIATES, SOCIETIES, AND COUNCILS...

American Society of Real Estate Counselors
Appraisal Section
Commercial Investment Real Estate Institute
Institute of Real Estate Management
Property Management Section
REALTORS® National Marketing Institute
Society of Industrial & Office REALTORS®
Women's Council of REALTORS®
REALTORS® Land Institute
Real Estate Buyer's Agency Council