The realtor Code of Ethics Quadrennial Member Education Program Copyright, 2000 National Association of realtors

Part 1: History and Background of the Code of Ethics

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Part 1: History and Background of the Code of Ethics

  • National Association of REALTORS formed in 1908.

  • No license laws at the time.

  • Real estate industry had a history of speculation, exploitation, and disorder.

  • Code of Ethics was adopted in 1913 to establish a professional standard of conduct.

  • Code of Ethics formed the basis for license laws.

  • From its inception, the Code of Ethics required arbitration of monetary disputes between REALTORS.

Page 2

Part 2: The Preamble of the Code of Ethics, concepts of business ethics and the structure of the Code

Suggested Time: Preamble: 10 minutes Start time: __________ End time: __________

A short lecturette covering this material, along with use of slides is the suggested presentation method.

The Preamble to the Code of Ethics is the aspirational foundation of the Code of Ethics. While the concepts in the Preamble do not serve as the basis for disciplinary action against a REALTOR, they are timeless principles upon which the professionalism of the industry is based.

Every REALTOR makes a personal commitment to uphold the Code of Ethics. The Code defines high standards of ethical conduct for our industry. The Code, in fact, defines professionalism. The REALTOR Code of Ethics is based on the overall concept of service to the public. It embodies the values of honesty, integrity, fair dealing, and competency. The Code also protects practitioners. If practitioners follow the Code, they will minimize their legal liabilities.

The concepts embodied in the Preamble are shown as bullet points in the participant materials. It is not intended that every item be discussed in detail. You should pick at least three or four important concepts to point out to participants. Comments on certain concepts follow.

Under all is the land …”: This powerfully descriptive beginning to the Preamble to the Code sets the stage for all that follows. The phrase clearly conveys the immense and all-encompassing nature of real estate and the real estate calling. Land is the foundation of many aspects of society, whether it be the basics of food and shelter, or the more sophisticated aspects of economy and prosperity. Truly, REALTORS deal in one of society’s most important commodities.

Widely allocated ownership” and “widest distribution of land ownership”: The Preamble uses these phrases in terms of the “survival and growth of free institutions and of our civilization” and that “the interests of the nation and its citizens require … the widest distribution of land ownership.” These concepts in the Preamble speak to a fundamental premise upon which our nation was founded. Given that much of our law and governance derived from England, under which the king held much of the available land, it is easy to see why the founders of our nation would have a desire not to have a few individuals own vast quantities of land. The accumulation of land can lead to inordinate power in the hands of a few. REALTORS support the fundamental concept that many persons owning small parcels of land is vital to the efficient functioning of our democracy.

Several of the Preamble’s concepts in the bullet points relate to the concept of the protecting the integrity of the profession. Aspirations to “maintain and improve the standards of their calling,” “strive to become and remain informed on issues affecting real estate,” “identify and take steps to eliminate practices which may damage the public or which might discredit or bring dishonor to the real estate profession” as well as the concept of sharing “with fellow REALTORS a common responsibility for the integrity and honor of the real estate business” all speak to the common obligations that REALTORS have in looking for the wider implications of their individual conduct in the daily practice of the real estate business.

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