Real Tea Podcast Season 2: Episode 19

Angela Shields (AS): We are excited to have back with us on the Real Tea Podcast Joe Harris, the Vice President of Government Advocacy for the National Association of REALTORS®. And it is not often that we have the opportunity to have a guest from the National Association of REALTORS® here in Nashville, let alone have you come twice. So, thank you so much for joining us.

Joe Harris (JH): Yeah, you keep inviting me, I’ll keep coming back. It’s one of my favorite cities.

AS: So… we are very honored to have you and we’ll twist away. So, I feel like this is part two. You were here about a year ago with us and we had some great conversation about what was going on on the national level.

JH: Yes.

AS: You came then and talked to our Advocacy Day attendees about giving a great update and you did the same this year. So we thought it would be great to bring you back on to the Real Tea and continue that conversation.

JH: Yeah. Happy to do it.

AS: So here we are talking about 2026—the midterms.

JH: Yeah.

AS: Let’s dive right in. So, tell me what you expect.

JH: Well, traditionally, the midterms don’t go very well for the president, who happens to be in power. And in this case, you have a Republican president, Donald Trump. So, you would expect, and history usually shows us, that the opposing party does pretty well.

AS: Mhm.

JH: We’ve seen, including here in Tennessee, the Tennessee 7 special election, uh, was a little closer. I think most people thought it should be given what happened a year ago, right? 22-point win by President Trump. The incumbent won by, I think, 22 points were right around there as well. A nine-point win is still pretty decisive, but not as large you might expect. So those are the that’s an example of what can happen in a midterm for any number of different reasons.

It always has to you know the person who’s in charge is going to get the blame and so that’s what we expect. I think the Democrats are feeling very bullish about their chances in November. Uh they’ve seen a number of elections in Virginia and other places around the country. Last November, governor’s races, New Jersey being another one go their way pretty decisively but they also picked up a lot of state legislature seats as well.

I think the economy continues to be the number one issue. Always is. Folks try to make it about something other than the economy and the voters always whether it’s Joe Biden or Donald Trump, it’s always the economy.

AS: It’s what we relate to.

JH: Mmhm. Yeah, and it and you know the price of gas, the price of eggs, you know these things impact real people.

AS: Right.

JH: You know and so, it’s going to be interesting because it’s not just the historical trends of you know which party controls and which doesn’t but it’s also—this year is going to be interesting from a redistricting standpoint. That’s something that we have not seen in the past that I think is going to be the X factor.

And quite frankly, I think depending on what the Supreme Court decides with the Voting Rights Act—section two of the Voting Rights Act—that will impact states like Alabama, Louisiana… and there’s several other states that are contemplating changing their maps. But depending on what happens there, it could be a pretty good advantage uh for the Republican caucus in terms of of retaining their majority because I think you give the edge to them in this sort of redistricting battle. But there are a lot of obviously six states have already sort of determined they’re going to change their maps .I think there are another five to seven that are trying to do it.

Time may not be on their side depending on what the Supreme Court does and how long it takes them to make a decision but it’s going to be interesting because I think it really does turn on redistricting and obviously the economy and how people are feeling about their own lives come November.

AS: A lot going on. I know that um NAR’s had a lot going on.

You had some news that you shared with our Immediate Past President Kevin Sears being on Capitol Hill. Why don’t you share a little bit about that?

JH: Yeah, so President Sears—Immediate Past President Sears testified before the House Financial Services Committee this past week, a full committee hearing, which is fairly rare in Washington D.C. these days. These hearings tend to be subcommittee hearings. So to get a full committee hearing is very rare. But Immediate Past President Kevin Sears was asked to testify on behalf really of a large swath of of real estate trades and the subject of the hearing was about increasing inventory and ways that we could cut red tape and get America building again and increase inventory. And he did a wonderful job. He got about I would say 75% of the questions that came from the dais and that hearing went on for over four hours.

AS: Oh wow.

JH: And I don’t know what was worse, the hearing itself or the hearing prep that we did for Kevin the day before, which I think lasted five hours. But, he has always did a great job and really honed in on a lot of the initiatives that we’ve been pushing, a lot of the policies that we’ve been trying to enact during his presidency and obviously he sits in a very unique position having been NAR president for two years. So he had a lot of to offer. I think that he got the invitation because the REALTOR® brand is strong, the organization is well respected and they know that when Kevin speaks—and now Kevin Brown—when they speak they’re speaking not only on behalf of themselves but on behalf of 1.5 million members—REALTORS®—practitioners in every zip code involved in every aspect of real estate.

So that comes with an air of respectability and knowing that you know we are as responsible as any other group for the direction of this country in terms of the policies that are going to increase inventory and they want to hear our ideas and they want to hear our research.

AS: Mhm.

JH: I also told the folks today that our research was quoted, used, cited by several members of Congress on that dais during the—during the hearing and that’s a testament to Dr. Lawrence Yun, Dr. Jessica Lautz and and all the the great research that everybody on that team does, and between the advocacy which is relentless, right? We’re on the Hill all the time, the resources and information that they get from us and obviously the financial resources through the PAC and other means.

You know, it’s a quite quite a formidable thing we’ve got going and and boy, do we need it because as I—going back to the research, one of the things that we’ve been sharing a lot lately is our 2025 Profile of Home Buyers and Home Sellers which highlights a very disturbing trend amongst the first-time home buyers in this country increasingly seeing the dream of homeownership become more and more out of reach.

AS: Sure.

JH: This year for the first time ever, the median age is 40 years old for a first-time home buyer.

AS: It just keeps getting higher.

JH: It just keeps getting higher. Last year was 38. The year before that it was 35. So, it’s a—it’s a trend in the wrong direction and the fear is you’re going to have a whole generation of potential homebuyers who are not going to know what it means to put—you know, dip their toe in the in the water of, of owner—homeownership, right, whether it be a one-bedroom condo or a small rowhouse, two-bedroom rowhouse. We—it’s just the fear is that you’re going to have a generation of people who don’t bother, right, who rent and all the equity that is left on the table when that happens and they’re already behind starting so late in terms of building that equity.

AS: Right.

JH: So, these are things and the research bears it out—that great research that we did with the the Profile of Home Buyers and Home Sellers—but these are the things that Kevin Sears and other—and all of us have been sharing pretty widely on the Hill—and quite frankly it it people know that there’s a problem but when you see statistics like that you understand the gravity of the problem and you understand that half measures are not going to work. You’re going to need to have real meaningful consistent legislative proposals to fix an issue that is really persistent since the the Great Recession in 2008.

So that’s where we are. It’s—it’s sobering but at the same time fear not because folks are taking note. The president’s talking about the importance of of of reforming our capital gains structure. Congress is talking about it. You know, you’re just hearing more and more bipartisan agreement that inventories got to be solved, not just building new inventory but unleashing the inventory that we already have through you know measures like the more homes on the market which would double the capital gains exclusion for the sale of a primary residence.

There there are people who are locked in. It’s—a it’s a equity penalty. they are they are hamstrung and locked because they don’t want to pay the capital gains.

AS: Right.

JH: And you’ve been on your home for 20 30 years, you want to downsize, you want to move closer to your kids or your grandkids, or you need to move into an assisted living facility. You don’t do that if you’re going to be on the hook for, you know, hundreds of thousands of dollars.

AS: Right, with the capital gains.

JH: And we’ve seen that around the country regardless of geography. It’s a—it’s a problem that is—exist and it’s only going to get worse.

AS: Right. There’s so much to unpack about what you just said but the first thing that I want to point out is that you just talked about one of the best parts about being a member of the National Association of REALTORS® because one, the advocacy. If you and your team were not there at at the capital, who would be there? Who would be watching out for all of these issues? Because I know of no other group who’s really focusing in on all the things you just talked about.

And that’s just one issue. That’s just one big issue. There’s so many other issues that you all focus in on. And you’re at the other hearings and you make sure a member is there to testify and you prep them and you you make sure everybody is represented. And I know today you talked about how many organizations are actually in front of the president and and have the time, even if it’s just three minutes, to actually pitch these ideas to make sure that we’re protected.

JH: Yeah.

AS: It—it’s amazing how much we get just out of the advocacy realm alone. And for that, I’m going to say thank you because it is it’s amazing to me. I know I’ve seen firsthand. It’s amazing to me how much you all do. It’s unreal.

JH: Thank you for that. Kevin Sears says all the time, there’s not an association of home builders or or home sellers.

AS: Right.

JH: There’s not an association of home buyers.

AS: Right.

JH: There’s an association of REALTORS®. So, we have to speak for the folks who are buying and selling and—and you know led by my boss Shannon McGahn, our our Executive Vice President, Chief Advocacy Officer.

We put together, I think, a really good plan for how we were going to approach 2025 under very uncertain circumstances. A new president, new administration with very little overlap from his previous administration. You look at all of the cabinet secretaries, there’s not many, if any, from the first administration, and that goes down to the staff as well. And then if you recall, we had the DOGE efforts at the beginning where a lot of the folks that we did know these agencies were no longer there. So it was just—just finding our sea legs and figuring out who is it over at Treasury, who is it FHFA or HUD that we could call on when you know some of these ideas were floating around and we needed somebody to get in touch with. And you couple that with all the new faces in Congress—12 new senators, 63 new members of Congress on the House side. So, just the effort by our team—and it takes a team—not just the lobbyists, not just the policy staff, not just the political staff, but our FPC’s, our state and local associations who have enjoyed relationships with a lot of these new members and could fill us in and tell us what we could expect. It takes a village and so the advocacy effort works because we don’t do it alone. We have partners in you all.

AS: Right.

JH: And so it’s a beautiful thing and like you said, there’s not—It’s equal doesn’t exist in Washington D.C. In fact, I get stopped—I don’t want to say often but a lot of my colleagues at other organizations, you know, take me to lunch and want me to explain how our FPC program works because they want to try to replicate that at their own organization. And when I tell them that we have an FPC for all 535 members of Congress, they’re like, “Well, I guess we won’t be replicating that because we don’t have we we don’t have the ability to do that.” But you know, it’s that level of advocacy and it has to be relentless. It has to be intentional. You have to target in on the things that matter.

And for us, we set goals—you know this year, we knew that tax reform was going to be our number one issue. We knew that the tax code was going to be the way that we could try to attack housing inventory, preserve what we know is working through the 2017 tax law and try to add on other tax provisions that impact things like capital gains. And we have a lot of work to do but I feel good that we were able to preserve the most important provisions that we’ve heard from our members because we poll our members and we talked to our members about what really works and first do no harm. That’s the that’s the number one thing, number one goal we had.

And at the end of the day, no matter how prepared you are and no matter how great your strategy is—what is it Mike Tyson says? “Everybody’s got a plan until they get punched in the face.”

AS: That’s right.

JH: So, you know, the best laid plans, you know, sometimes get blown up because at the end of the day, you’re also at the mercy of which direction the administration wants to go in, what direction the speaker wants to go in.

And so you find yourself you know being somewhat reactionary, but you’re never caught flatfooted. And I think that’s what we try to avoid. We try to avoid a situation where we know they’re going to be surprises. We know that we’re going to see something we weren’t expecting but we don’t want to get caught flatfooted. And having a seat at the table means that you’re more often than not hearing about certain things coming down the pike before they actually get enacted. You’re actually able to do something about it.

AS: Well, and it probably—correct me if I’m wrong—has a lot to do with the fact that you’re trusted because we do stay on our topics of private property rights and real estate and we don’t get off on the radical topics that we don’t belong in. And then you also have built up the trust because of all the resources that you provide that you mentioned earlier.

JH: Yeah.
>> Yeah. The resources are very important and I’m always surprised those profiles that we do of every district where they’re showing the demographic breakdown. They’re showing how what percentage are homeowners, what percentage are college educated or high school educated. These are very important to members of Congress as they’re thinking through all of these different bills, not just housing related bills, but all the bills that come before their desk for their consideration. And so it’s it’s a little bit of everything, but you want to be relevant.

AS: Mmhm.

JH: You want to be a resource. You want to be the ones—and it makes me so proud when I’m watching CNBC in the morning, Squawk Box or or something like that, and the National Association of Realtors research is quoted on CNBC.

AS: Yes.

JH: I just love that and that I know has been a very intentional shift of focus not only from Shannon McGahn but from our CEO Nykia Wright. They both want NAR to be the resource that folks are quoting. Not Inman, not you know—NAR, we—it’s our research. We should be the ones delivering that research to policy makers and to consumers. And so, yeah, it’s it’s very intentional, but I think it makes a really—it’s really important. It makes a big impact during the biggest battles like what we’re facing now with with the housing shortage.

AS: Yeah, 100%. So, shifting gears just a little bit, let’s talk about capital gains legislation. So, do you see that becoming part of the federal tax bill or are there any chances it might?

JH: Yes, we’ve been talking about it for over a year—as specifically the More Homes on the Market Act, which was introduced in the House last Congress by Congressman Mike Kelly, Republican from Pennsylvania, and Congressman Jimmy Panetta, a Democrat from California. This bill would double the capital gains exclusion for the sale of a primary residence from $250,000 to $500,000 for single filers and $500,000 to $1 million for joint filers. And what we found is the stay-put penalty for folks who, who want to sell but will not sell locks up millions of units of inventory. And so this sort of bipartisan agreement that we need to find a way to deal with this issue has been growing. It has been growing steadily, exponentially really, since the REALTOR® Legislative Meetings, since Midyear.

And it’s gotten to the point where the President is talking about it, the FHFA Director, Bill Pulte is talking about it—and we actually just had the More Homes on the Market Act introduced on the Senate side just on Wednesday by Senator John Cornyn from Texas and Senator Michael Bennett from Colorado. And so now we have a House bill and a Senate bill and a lot of momentum and we’re going to take advantage of their—we’re still waiting for them to do a press—press conference, but we’re going to activate our FPCs, try to get as many Senate co-sponsors as we can. But I feel really good. Uh there’s a there’s a very good chance that another reconciliation bill is in the offing next year.

AS: That’s exciting.

JH: Yeah, and this is the perfect thing to be included in any reconciliation bill that’s moving. So, I’m bullish on getting the capital gains bill done because so many people in the administration and in Congress are talking about the need and have again been using the capital gains exclusion as an example.

1997 is the last time it was touched, when the median, you know, value of a home was $124,000. Now it’s over $420,000. So the tax laws need to keep up with the times.

AS: Right. Right. Because that’s a huge increase.

JH: Uh, yeah. Yeah.

AS: Well, and then the other thing that you hear a lot of people talking about is the private—I cannot even say it right now—the privatizing GSCs—um let’s talk about that a little bit. What’s the latest you have on that?

JH: Yeah. So, this is something again there aren’t any firm plans. It’s just, you know, a lot of times with with this administration, they float some things out there on Twitter, on Truth Social, and they’re meant to, I think, in my view—I mean, I’m not, you know, in the room with the the advisers who are advising the President on this, but to get people talking about it and see what the reaction is, particularly from the general public, but also from groups like ours.

AS: Mmhm.

JH: And that again is where we have really doubled our efforts and maintaining those lines of communication within key agencies so that when this idea of privatizing the GSCs comes up, we can register our concerns effectively within this administration, also within Congress.

But uh it’s a real possibility. In fact, we don’t know if it’s going to happen this year or early next year, but the GSCs will be taken out of conservatorship, which we support but we also support it being done responsibly with certainty because uncertainty in the mortgage market is a very dangerous thing, as we all know. And we prefer and support the current utility model that has the best of both worlds. You have the government guarantee you have certainty and liquidity and it’s the best protector of the 30-year fixed mortgage which is the gold standard.

And so all these things we’ve communicated with Director Pulte, with Treasury and others and they know where we stand but at the end of the day, that’s all you can do and then see what happens and try to, whenever a proposal is put out there, try to make it try to improve it as much as you can. And again, that goes back to what I was saying about you may get some surprises but you never want to get caught flatfooted. You want to be able to pivot and be able to have trust and communication that improves whatever proposal idea is out there.

AS: So tell me about what—what you see coming up other things that you might see for ’26. Is there anything else you—you think we should be thinking about?

JH: Uh, well, the big thing is is obviously the midterms and that is an opportunity for us to support our REALTOR® champions. A lot of them are going to be challenged from the left and from the right in primaries and in other places. But that’s to me that’s an opportunity just to to show people who’ve been there for us time and again that we’re there for them and their hour of need. But before the midterms, there’s a lot of work to do and a lot of opportunity and reconciliation if it indeed happens. And oh, by the way, before the government shutdown, the 43-day shutdown, both the speaker and the Senate majority leader were very bullish on having two reconciliation bills in 2026.

We’ll see what the timing is because doing one is very difficult. So doing two—we’ll see if if they can get it done. But that provides an opportunity for us. So we’re going to keep hammering away on this capital gains idea. Now we have more homes on the market. There’s also a bill out there introduced by Representative Margie Taylor Green which would dispense with all capital gains taxes on the sale of a primary residence which was getting support from this administration. And so I feel good about us continuing down that path. But also as we all know, January 30th is going to be here before you know it and there’s a chance of another government shutdown.

AS: Yeah. They put a deadline on that.

JH: Yeah.

AS: Are you worried?

JH: Yes, I am because I just saw it happen for 43 days and we didn’t think it was going to happen. We thought that cooler heads would prevail. They eventually did, but it took them 43 days and in the process they set a record for the longest shutdown in American history.

AS: Let’s hope they don’t do another record.

JH: I hope not. And I hope that the the prospect and the reality of a midterm election will, again, make people make smarter decisions because no one wins in a shutdown. The only—in fact a lot of people are harmed.

AS: Right.

JH: And the same issues that persisted in the first shutdown persist right now and are preventing us from coming to a deal to prevent a second one in as many months. And so our focus is going to be on reminding lawmakers it’s—you know, we can walk and chew gum at the same time. We can be aspirational and try to get capital gains done while also saying we need to just block and tackle, you know, we need a first down—keep the government open because if that doesn’t happen the—our industry which relies so heavily on a strong economy on commerce on people spending money or having savings you know—you’re doing a lot of harm to a part of the economy that is extremely important.

We’re nearly a fourth of the economy—real estate—and sowe have been and will continue to be very vocal and we’ll activate our FPCs again if we need to do another targeted CFA as we creep closer to this January 30th deadline. But yeah, the Affordable Care Act subsidies are still an issue. That issue has not been resolved and so lawmakers will have to do that if they’re going to prevent it from happening again.

AS: We’re going to keep our fingers crossed that we don’t go through that again. Looking back as we kind of come to the end of of today, looking back, what are some of the wins that we can remind members that happened in ’25?

JH: Yeah, we had a lot of wins. Again, the 2017 tax bill had a lot of good stuff in it and we wanted to keep it. We wanted to keep 1031 like-kind exchange.

We wanted to keep mortgage interest deduction, the 20% pass through deduction 199A. And not only were we able to do that, we were able to permanently extend both the 199A pass through deduction but also MID. We were able to keep 1031 like-kind exchange. We were able to quadruple the state and local tax deduction from $10,000 to $40,000.

So a lot of good wins because these were not foregone conclusions. All these particularly things like 1031 were on the chopping block as they always are when you’re going through the debate of what goes in and what goes out. But also just the robustness of the support around the capital gains legislation is another win for us. The fact that the President is talking about it and on social media about it. I feel like we’ve—more than any other organization—has kind of kept beating the drum on the importance of that as a tool to address housing inventory and so I feel very good about our accomplishments. We still have a long way to go. Nobody’s taken a victory lap yet, but we’ve positioned ourselves very nicely to to see it through in 2026 and it starts with the the foundational victories that we had in 2025.

AS: So everything you just talked about in my mind shows the value again of advocacy and RPAC. In your—I’m going to really put you on the spot. In your mind, if NAR was not there, what would that world look like?

JH: Well, I will say—I’ll say this. Other trade associations and the real estate ecosystem look to us to be the lead on everything related to real estate and we take on a lot of different roles. We’re the lead on a lot of different letters, policy discussions but there’s not another apparatus in D.C. that touches as many aspects from the administration to Congress to state, local… You cannot—and it goes back to what I said before, we can’t do this alone. This isn’t something that just can be done at the federal level and NAR sets sort of the tone and the framework for how and the communication that’s essential between state, local, and national in order for it to to all work and to all happen.

And so if we if NAR weren’t around, which a lot of people try hard to do through the lawsuit and and other means—through smear campaigns and the New York Times and others—it would be a place where consumers would be worse off at the end of the day.

AS: 100%, and I think our members would be worse off.

JH: Mmhm.

AS: I—I tell members that I get to talk to who would be there to make sure that they got to keep their independent contractor status.

JH: That’s right.

AS: They they may be working as employees.

JH: Yep.

AS: Then who would be there to make sure that the the flood insurance was taken care of?

JH: Yup.

AS: And you could just keep going down the list and so on and so on and so on because I don’t know that people would care enough to be there to fight those battles every day.

JH: We’re the only ones that are consistently talking about flood insurance, consistently talking about independent contractor status. And it’s part of an overarching sort of—an overarching strategy to get Congress to focus on those things that they can agree on because these things have bipartisan agreement. Rather than focusing on the 20% of the stuff you’re never going to agree on, focus on our issues because they impact real people and they have the support of progressives and you know, and conservatives, you know, red, blue, Senate, House. Give these folks something that they can rally around and do in a bipartisan way. And that’s our lane. That’s the sandbox that we play in, and you know, getting them to to get off this hyperbolic, you know, sensationalized stuff that happens when the camera’s rolling.
That’s what we do. We’re like, “Okay, you had your fun on MSNBC or Fox News.
Now come up, roll your sleeves. Let’s get to work” because there’s stuff that you agree on. We have the policies and the solutions right here. All you got to do is just decide that you want to get it done. And that’s kind of what that’s where we—that’s where we butter our bread.

AS: It’s where you all shine as well and we appreciate it so much.

JH: Thank you.

AS: Again, I think it comes back to it’s one of the most important reasons that members should be members. They get the biggest bang for the buck in our advocacy lane. And I say thank you. We appreciate it very much.

JH: Well, thank you. Thank you for having me.

AS: Well, I appreciate you being here and I’m going to try again next year to try it again. Thank you very much.

JH: I keep coming back. Thank you.

AS: Thank you.

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