NAR Exposed!

In the wake of the bursting housing market bubble, the National Association of Realtors (NAR) started buying up members of Congress like crazy and got some cool stuff for its members.

And we, the poor slobs who pay taxes, are stuck with the bill. If that annoys you even a little bit, keep reading.

According to the fine folks over at OpenSecrets.org, the NAR has been spending money like it’s going out of style over the past couple of years. In 2009, the NAR spent $19.48 million in its continuing efforts to suck on the government teat and $17.34 million in 2009 — a total of $36.82 million in two years.

That’s a nice amount of money, but it’s mere chump change considering what the NAR got in return. From April 2008 through April 2010, the government actually paid people to go out and buy homes in the form of tax credits. Eligible first-time buyers received fat, government dollars throughout the life of the two-year money grab while repeat home buyers weren’t as lucky — they only got paid for transactions entered into between November 2009 and prior to May 1.

The cost to taxpayers, a mere $21 billion according to the latest estimates from the U.S. Treasury department. In other words, first-time buyers got up to $8,000 in tax credits, repeat buyers received up to $6,500 for purchasing homes, Realtors got some commission checks and most of us schmucks received no benefit and get to pay for it all.

That $36.82 million in bribe money spent by the NAR was a great investment for Realtors throughout the country, then.

Ah, but there’s more. Bear in mind that the Federal Reserve spent $1.25 trillion from November 2008 through March 2010 propping up the mortgage backed securities market. Apparently, the NAR has no problem with the government showing up and taking on the role that has traditionally been reserved for private investors.

Here’s the thing about the mortgage-backed securities market — as investments increase in that market, so do yields as those securities are regarded as less risky. As risk and yields drop, mortgage rates fall, too. In other words, the Fed stepped in and artificially held interest rates low so that more people would purchase houses.

Ironically, economists expected interest rates to climb substantially after the Fed ended it’s spending spree in the mortgage-backed securities market. However, that didn’t happen — rates that had been hovering around 5 percent or better fell to around 4.5 percent or better for 30-year, fixed interest mortgages and have remained at that level.

Why? The credit systems in Europe went to hell and private investors started looking for safer places to put there money — places like the mortgage-backed securities market. Capitalism, indeed, is a wonderful thing — it’s too bad the Fed and the NAR are intent on wasting our money monkeying around in (formerly) free markets.

The NAR bought some other pieces of legislation (all in the name of helping home owners, mind), but those are two huge benefits that are well worth mentioning. In other words, the NAR spent $36.82 million buying off congressmen on those two issues and received benefits costing taxpayers at least $1.46 trillion. Talk about bang for the buck!

Now, some of that might be OK if the NAR wasn’t so stingy when it comes to its members shouldering some of the tax burden for such expensive programs. The attitude of the NAR is summed up very well by a “crisis” that took place in Pennsylvania this year — Gov. Edward G. Rendell wanted to tax professional fees, including real estate commissions.

The Pennsylvania Association of Realtors bought legislators, sent out a survey (completely unbiased, of course) and generally pitched a fit until the attempt to tax professional fees was defeated. A particularly entertaining element to this tale is found in this article featuring Pennsylvania Realtors going to the state Capitol to annoy people.

As I’ll gleefully show in the weeks and months to come, the NAR and it’s members share the same philosophy — they want the government to spend cash that benefits its members, but none of them want to pay for it. No, that’s the job of us taxpayers.

That, really, is a major problem at all levels of government. These pesky special interest groups like the NAR want the government to spend cash that directly impacts them, yet they raise all kinds of hell when they are asked to give something back.

In the case of the NAR, that group’s constant cries of “gimme, gimme, gimme” might be among the worst of any special interest group out there. Look at it this way — the federal government just spend close to $1.5 trillion propping up the housing market, and what has it gotten us? Housing markets were supposed to stabilize, but has that happened? As soon as the tax credits were gone, pending homes sales fell at the largest rate since 2001.

The whole point of spending all that money on tax credits and capital for the mortgage-backed securities to market was to stabilize housing markets. That hasn’t happened. That NAR and it’s clever pack of slimy lobbyists, then, have saddled us all with more debt and most of us don’t have a thing to show for it.

Thanks, NAR. You guys suck.