Real Estate Overhaul: NAR’s New Commission Rules
In a landmark shift that could reshape the real estate landscape, the National Association of Realtors (NAR) has rolled out new commission rules following a lawsuit settlement in March 2024.
In a revealing interview with ETRealty.com, PSN Rao, the Hon. Chairman of realtors body NAR-INDIA, sheds light on the pressing challenges faced by real estate brokers in India. The industry, often marred by accusations of unprofessional behavior and misleading potential buyers, is in dire need of reform.
Rao emphasizes the importance of implementing a licensing system for property brokers, a move that could significantly enhance their professionalism and accountability. Despite the real estate regulatory bill’s promise to bring brokers under its scope, it falls short by not addressing the secondary real estate market or establishing a licensing framework. Such oversights, according to Rao, render the bill less effective for the average consumer.
In response to these challenges, NAR-INDIA has initiated various training programs aimed at elevating the skills of real estate brokers across the nation. These programs cover a wide range of topics, including marketing, sales management, and customer relationship management, and are conducted in over 25 cities, benefiting a network of 30,000 brokers.
Interestingly, the rise of online property portals, which some might view as a threat to traditional brokers, is seen by Rao as an opportunity. These platforms serve primarily as listing services and can actually facilitate brokers by providing greater market transparency. They also educate investors and purchasers, contributing to a more informed market environment.
The housing market in India is currently experiencing a downturn, attributed to what Rao describes as a ‘policy paralysis’ of the previous national government. However, there is renewed optimism with the current government’s initiatives, such as reducing FDI limits and cutting home loan rates. Further policy announcements, including the much-anticipated smart city policy and the ‘Housing for All’ program, are expected to revitalize the market.
Despite these positive developments, consumer sentiment remains low, largely due to project delays and contract breaches by developers, particularly in North India. Rao argues that a real estate regulator could address these issues, thereby restoring trust and confidence among buyers.
