Behind Recent Legal Wins, REALTOR® Advocacy Was at Work

Across the street from the U.S. Capitol, where thousands of REALTORS® will descend next week for the 2024 REALTORS® Legislative Meetings, is the Supreme Court. And while REALTORS® are known to carry their message to city halls, statehouses and Capitol Hill, their voices also ring inside the nation’s highest court—even if a bit more quietly.

In consultation with the Legal Action Committee and the Amicus Brief Advisory Board, NAR’s advocacy team has been a driving force behind recent legal victories for property owners at the Supreme Court. Two wins in particular underscore the power of NAR’s legal advocacy, which is often the last line of defense on issues that threaten private property rights. NAR filed amicus briefs supporting property owners in both cases, which involved a dispute over hefty property fees and issues around land takings.

There are many more legal cases NAR is involved in, teaming up with state and local REALTOR® associations, as well as other housing organizations, to address expanding fair housing protections, issues stymieing affordable housing and other real estate priorities.

Case Study: How Advocacy Saved 42 Homeowners

“We need to harness the power of a 115-year-old organization, the biggest lobbying force and largest trade organization in the United States,” Pamela Hanson Carbone, GRI, broker-owner of Domain Properties in Providence, R.I., says of NAR membership. “We need, as an industry, to share with consumers about what we can do and our advocacy wins.”

The Washington Report, published by NAR’s advocacy team, covers the latest legislative and regulatory policy activities. Stay up to date on recent advocacy efforts at nar.realtor/advocacy.

Carbone credits NAR for helping her in 2018 to block a local development plan for a gas station, which would have created complications for homeowners in a nearby neighborhood. With NAR’s guidance, Carbone reached out to HUD for clarification on a rule that stated properties within 300 feet of a gas station are ineligible for FHA loans. After she presented the information to her city council, the gas station proposal was abandoned.

The council also passed a law banning gas stations and fuel storage tanks from being built within 300 feet of residential homes. The law now serves as a model for other municipalities. “We ended up saving 42 homeowners from the building of a new gas station that would’ve prevented all 42 of them from ever selling their home to an FHA buyer,” limiting their future buyer pool, Carbone says.

She retells the story to her clients, an important part of communicating who she is as a REALTOR® and what she does to support home buyers and sellers. She also uses the experience to teach new real estate licensees that they not only represent consumers in a transaction but also serve as a community advocate.

6 Legal Issues on REALTORS®’ Radar

NAR, its partners, and state and local associations are a standing army ready to raise the alarm anywhere property rights are threatened. Here are some of the issues they’re watching closely.

1. Advocating for mortgage market stability: NAR, the National Association of Home Builders and the Mortgage Bankers Association filed an amicus brief in a Supreme Court case challenging the constitutionality of the Consumer Financial Protection Bureau. While taking no position, the groups urged against a broad court decision that could disrupt the nation’s mortgage market. “Nearly all home purchase transactions for more than a decade have been made in accordance with CFPB regulations, and consumers have come to rely on the protections provided by the disclosure and transparency requirements imposed on lenders and real estate professionals under those rules,” the groups wrote. A ruling is expected in June.
2. Fighting against rent control: NAR led an effort to support a Supreme Court review of two cases challenging New York’s rent stabilization law. “Rent control laws exacerbate housing supply and affordability problems by reducing the quantity and quality of available housing,” NAR argued in an amicus brief. The association joined the National Apartment Association, National Association of Home Builders and Mortgage Bankers Association in advocacy efforts on these cases. Though the Supreme Court ultimately declined to weigh in on both cases, Justice Clarence Thomas left the door open for potential future court action.
3. Stopping regulation overreach: NAR and a coalition of partners, including the Farm Bureau and the National Association of Home Builders, filed a lawsuit to prevent a “Waters of the U.S.” regulation that would make it more difficult for property owners and developers to use land. The “WOTUS” rule outlines which streams and wetlands are protected by federal jurisdiction under the Clean Water Act. These designated areas could be subject to special permit requirements and regulations. In March, NAR and the coalition secured a preliminary injunction to stop the new rule from taking effect in Texas and Idaho. The Environmental Protection Agency has since issued a new rule, which still poses problems for homeowners, NAR says. While litigation continues, NAR’s coalition has expanded to include the REALTORS® Land Institute and the South Carolina REALTORS®.
4. Fighting “equity theft”: In March 2023, NAR submitted an amicus brief to the Supreme Court, arguing that property owners are entitled to surplus equity in a case challenging a Minnesota statute that allowed the state to keep foreclosure sale proceeds in excess of debt owed as a windfall. NAR, along with the American Property Owners Alliance and Minnesota REALTORS®, argued the state statute amounts to an unconstitutional taking of private property under the Fifth Amendment. The Supreme Court ruled unanimously in the homeowner’s favor, saying she was entitled to surplus equity that was taken in a foreclosure sale. NAR has since been supporting state efforts to correct laws that contradict the Supreme Court’s ruling.
5. Defending against unconstitutional takings: NAR filed amicus briefs supporting property owners in two Supreme Court cases involving the Constitution’s Takings Clause, which states that private property cannot be taken for public use without just compensation. In one case, a property owner faced thousands of dollars in extra permitting fees to develop his land, which the county would use for infrastructure and road improvements. In the second case, NAR joined Texas REALTORS® and the American Property Owners Alliance to support a property owner whose land regularly flooded after a state construction project on a nearby highway. In April, the Supreme Court issued unanimous decisions in both cases siding with the property owners.
6. Releasing property owners from undue financial burden: In 2021, NAR supported a legal challenge to the federal eviction moratorium imposed by the Centers for Disease Control and Prevention during the COVID-19 pandemic. The case, which was brought by the Georgia and Alabama Associations of REALTORS® and other property providers, ended up before the D.C. Circuit Court of Appeals and Supreme Court twice. The Supreme Court ruled that the federal moratorium was unconstitutional, a landmark decision establishing a legal precedent that has been the basis of nearly all recent challenges on federal administrative overreach.