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The bumpy relationship between the National Association of Realtors (NAR) and the Department of Justice (DOJ) took center stage at NAR’s midyear conference on Monday.
The trade group’s legal battles and industry skirmishes with the DOJ were discussed at two separate sessions by NAR president Kevin Sears and NAR executive vice president and chief advocacy officer Shannon McGahn, as first reported by Inman.
During a Broker Engagement Council meeting, one member sought insight into why the DOJ still seems to be focused on NAR despite the trade group’s strong advocacy relationships with lawmakers.
According to Sears, NAR’s relationship with legislators does not translate to a good relationship with the DOJ. Sears said things between NAR and the DOJ were “rocky” in 2024, a year that saw an appeals court overturn a lower court ruling, opening the door for the DOJ to reopen its investigation into NAR, which filed a writ of certiorari — that was ultimately denied — with the U.S. Supreme Court in response.
During two meetings with the DOJ in Washington, D.C. last year, Sears said he found that “there was a clear lack of understanding of how we do business by some of the people that were there in the room.”
“They think we take advantage of the consumer. We protect the consumer. Without the consumer, we don’t exist. Why are we going to take advantage of them? So we explained to them about that,” Sears said.
Over the past 70 years, the DOJ has investigated NAR 35 times.
“They think we make too much money,” he said. “That’s it. I said I represent 1.5 million entrepreneurs who choose to wake up unemployed every day. But it’s through their hard work, by representing their clients and consumers, that they can earn a living.”
Sears was careful to note that all of this was from 2024, stating that he is “cautiously optimistic” for how the trade group’s relationship with the DOJ will evolve in 2025. He told attendees that he is hoping to set up a meeting with Gail Slater, the new head of the DOJ’s antitrust division under the Trump Administration.
“Ultimately, what I’m looking for is world peace: Is there something we can do where we can be on the same page?” Sears said. “Where we can go to our members and go to our brokers and say, ‘Okay, follow these rules and we should be good’?”
Sears also warned attendees that the DOJ is not only watching agents’ social media posts, but also all of the podcasts and videos coming from the industry to ensure that no anticompetitive behavior is taking place.
In a separate session, McGahn echoed Sears’ sentiments that things between NAR and the DOJ seem to be improving, noting that it appears the DOJ is shifting the focus of its investigative efforts.
“The (Trump) administration’s priorities the last go-around were more focused on fees,” McGahn said. “The current administration is much more focused on the technology industry.”
Due to this shift in focus, McGahn said the DOJ’s antitrust division appears to be pivoting to examine state regulations and laws that are impacting the cost of housing, which is inline with President Trump’s executive order aimed at lowering the cost of housing and boosting supply. McGahn reassured members that NAR has “a seat at the table” for these discussions, and that she has known Slater for years.
“We do know many of the staff who are over there, and we’re again pleased to see they requested information on regulatory burden,” McGahn said.
Things do seem to be cooling between NAR and the DOJ as, the DOJ appears to have dropped its challenges to MLS Property Information Network’s (MLS PIN) settlement in the Nosalek commission lawsuit, now that MLS PIN has agreed to remove offers of buyer broker compensation from the MLS. This move is certainly seems inline with Sears and McGahn’s assertions that things are beginning to thaw with the agency, but the future remains unclear.
Neither NAR leader said if the DOJ has dropped or made any changes to its current investigation into NAR practices, which dates back to 2018 and includes the now defunct Participation Rule and the contentious Clear Cooperation Policy (CCP). An additional complication is that the DOJ appointed Roger Alford as its deputy assistant attorney general. Alford served as an antitrust expert witness in the Sitzer/Burnett commission lawsuit testifying against the real estate industry.
Although the past year has certainly been challenging for the industry and the threat of action by the DOJ still looms large, Sears encouraged members to embrace the commission lawsuit settlement agreement business practice changes and to take the opportunity to explain the value agents and Realtors provide to consumers.
“A year from now, I want to make sure that our Realtor members are still smack dab in the middle of the transaction,” Sears said.
