Should local banks be allowed to become actively involved in the real estate brokerage business? Specifically, should they have an administrative hand in the sale and management of units in co-ops and condos?
These questions are currently hot points of discussion among leaders in the real estate and banking industries. Proponents on both sides of the issue are speaking out, expressing strong opinions both for and against the status quo, which is itself presently being challenged by a proposal under serious consideration by the Federal Reserve Board and Treasury Department. The proposed bill would allow federally chartered banks to engage in real estate brokerage and property management activities.
The official deadline for public remarks on this issue was May 1, 2001. However, consumer comments are still being received and considered by the board. It will probably take several more weeks or months for all the responses to be evaluated and decisions made.
According to James McLaughlin of the American Bankers Association (ABA), some 40,000 comments have been received by involved agencies to date. Many of those comments have been submitted by real estate brokers as part of an anti-bank campaign orchestrated by the National Association of Realtors (NAR). In addition to sending letters, faxes, and e-mails, about 7,500 Realtors descended upon Washington in May to canvass Capitol Hill with a message for lawmakers to "Stop the Big Grab."
While the Fed deliberates, the arguments from both banking and brokering industries rage on. The easiest way to decipher the debate is perhaps to examine each camp individually.