How Membership Dues are Spent at the National Association of Realtors (2022)

The National Association of Realtors (NAR) is the largest professional trade association in the US. A non-profit tax-exempt 501 (c) (6) based in Chicago, Illinois, NAR represents 1.5 million members (although this number could greatly decline with the most recent judicial proceedings that eliminate rules on commissions, as agents leave the industry when faced with lower commissions) who belong to one or more of the 1,300 associations/boards and 54 state or territory associations.  Members can be residential or commercial brokers, sales people, property managers, real estate appraisers, counselors and others who work in the real estate industry.

NAR functions as a self regulatory agency, a lobbying organization, and as a provider of accreditation and certification of designations.

Key information to know about NAR include:

• NAR is based in Chicago with about 380 employees.
• NAR has more than 1,000 voting members of its governing body.
• NAR has historically. generated about $300 million annually, primarily through membership dues (which average about $200 a year for the 1.5 million members), all of which means NAR benefits greatly from a large base of members and increased membership.  This could change in the future with the most recent court proceedings, driving agents out of the industry if commissions decline (which many people predict will happen).
• NAR has historically spent less than they raise, allowing the organization to accumulate nearly $800 million in net assets by year-end 2022.

So, how are membership dues spent?  The short answer is that about 33% of membership dues are spent on compensation and office-related expenses.  48% is spent on fees for outside services (primarily a media company), advertising and promotion, public policy, and travel and conferences. 10% is spent on grants and other expenses while 9% is added to the general fund..

In 2022, NAR reported total revenue of $328 million (compared to $327 million in 2021, $301 million in 2020, $338 million  in 2019, and $245 million in 2018), of which $285 million (87% of revenue) came from membership dues.

Expenses totaled $298 million (not including $8 million in depreciation) – 91% of revenue – and can be categorized as follows:

• $73 million (22% of revenue):  Compensation
• $58 million (18% of revenue). Fees for Services
• $38 million (12% of revenue):  Public Policy Expenses
• $35 million (11% of revenue):  Office-Related Expenses
• $34 million (10% of revenue):  Advertising and Promotion
• $28 million (8% of revenue):  Travel and Conferences
• $19 million (6% of revenue):  Grants
• $13 million (4% of revenue): Other Expenses (primarily “other” with no detail provided)

As illustrated above, the two largest expenses are compensation and fees for services.  379 employees received $73 million in compensation (an average of $193,000) with the most highly compensated employee reported to be Bob Goldberg, the CEO who received nearly $2.6 million in compensation in 2022.  It is also important to note NAR paid for first class or charter travel, companion travel, health or social club dues or initiation fees, personal services, and provided gross up payments and tax indemnification.

Fees for services were primarily to a company called Havas Media Group who received $45 million in compensation for marketing and communications.

Using the above information, every $100 in revenue was spent as follows:

$100:  Revenue

-$ 22:  Compensation

-$ 18:  Fees for Services

-$11:  Office-Related Expenses

-$10:  Advertising and Promotion

-$ 8:  Travel and Conferences

-$ 6:  Grants

-$12:  Public Policy Expenses

-$ 4:  Other Expenses

-$91: Total Expenses

 $ 9:  Excess Revenue:  To General Fund

NAR spent $91 out of every $100 on organization expenses.  $33 out of every $100 was spent on compensation for the 379 employees and office related expenses; $48 out of every $100 was spent on fees for outside services (primarily the Havas Media Group), advertising and marketing, public policy, and travel and conferences, while $10 out of every $100 was spent on grants and other expenses..  $9 out of every $100 was added to the general fund.

To read the IRS Form 990 (2022), click here.