Archive for May, 2009

FHA just re-released mortgage letter 09-15, outlining details of its program that will allow homebuyers who qualify for the $8000 tax credit to use it towards closing costs. Here’s the official press release.

AP: Multiracial people become fastest growing US group

According to an AP story, multiracial Americans have become the fastest growing demographic group.  Read about it here.

NPR Poll: Economists Say Recession Likely To End In ’09

From Morning Edition this morning:

A survey of 45 top economists concludes that the recession will probably end by the second half of this year. But the poll from the National Association of Business Economics also suggests the economy will stay soft and the labor market won’t improve until next year.

Read (or hear) it here.

“It’s Not You It’s Me”: What Happens AFTER the Closing

You’ve worked with a client for months, been there for every step and probably know more about them than many of their friends/family do.  All the final closing papers are signed and you say your goodbye’s. Now what?

Most will tell you to regularly shower them with mailers and random or timed phone calls so they know you’re still around and there to help them.  I tried the random calling and even “pop bys” with some success but have also noticed a trend in the past year: people are busy and do not need you barging in on a random or timed basis.  If you did a good job for your clients most WILL keep your name in mind and pass your information along to others.

So the natural thought becomes “How do you keep in touch with these busy people without being completely obnoxious or intrusive?”  Well here’s my current plan of attack:

  • A monthly newsletter that people I add have the option to opt-in to receive:  (VAR members receive a newsletter service FREE via ClientDirect)
  • Facebook:  most of my past clients and prospects are my Facebook friends so they can see that I have both a professional AND personal life.
  • A Blog:  this tool is useful to offer local information to your target audience.  It also offers a great way to discuss popular topics an FAQ or KnowledgeBase of sorts
  • Closing Gifts of Value: Gift baskets are nice but for some things I’ve found clients will find of more relevant value are Lowe’s REALTOR Benefits and Homeminders
  • Client’s Access to what they need when they need it.: One of the services I implemented was 24/7 access to transaction documents both during AND after the transaction.  This has been a huge hit among both past and prospective customers/clients.

Your way of follow-up will vary based on your personality and how your customer base prefers to keep in touch.  Has anyone else noticed the ways of keeping in touch changing with the times?

Apparently there are media outlets reporting that the FHA bridge loan (you know… THAT one) is not going to happen. It’s an understandable misunderstanding, I guess. After all, FHA announced the program in front of thousands last week at Midyear, released mortgagee letter 09-15 describing details of the program, and then later retracted it with no explanation whatsoever.

Well, Realtor magazine says it’s just a matter of time before guidance on the bridge loan is re-released.

In the meantime, for whatever it’s worth, FHA released mortgagee letter 09-16, skipping right over 09-15.

Online Renter Blacklists

You heard me right, there are now lists on the internet that landlords can refer to to see if a prospective tenant is a good candidate.  One such list is do not rent to dot com.  It appears that any landlord can submit unfavorable information about a past or present tenant for free, but in order to access the blacklist records, you need to pay $29.99.

The information that a landlord can enter onto the site include social security numbers, driver’s license numbers, renter’s full name, amount of bills owed, pictures of damage and a 4000 character comment section.  NBC12 News reports that there is nothing illegal about landlords participating in this website.  However, there are plenty of consumer advocates who disagree.  Landlords could violate local, state, and national Fair Housing Laws in their comments.  And although this was the reason this article was sent to me (I’m a certified and state licensed fair housing instructor), I see a much bigger and easier trap of violating the Virginia Landlord Tenant Act.

The Virginia Landlord Tenant Act clearly states in 55-248.9:1

Confidentiality of Tenant Records that no landlord or managing agent shall release information about a tenant or prospective tenant in the possession of the landlord to a third party unless:

1. The tenant or prospective tenant has given prior written consent;
2. The information is a matter of public record as defined in § 2.2-3701;
3. The information is a summary of the tenant’s rent payment record, including the amount of the tenant’s periodic rent payment;
4. The information is a copy of a material noncompliance notice that has not been remedied or, termination notice given to the tenant under § 55-248.31 and the tenant did not remain in the premises thereafter;
5. The information is requested by a local, state, or federal law-enforcement or public safety official in the performance of his duties;
6. The information is requested pursuant to a subpoena in a civil case;
7. The information is requested by a contract purchaser of the landlord’s property; provided the contract purchaser agrees in writing to maintain the confidentiality of such information;
8. The information is requested by a lender of the landlord for financing or refinancing of the property;
9. The third party is the landlord’s attorney; or
10. The information is otherwise provided in the case of an emergency.

Who has to abide by the Virginia Landlord Tenant Act?

The VRLTA covers most residential rental agreements. Several types of properties are exempt from the Act, including single-family rental houses where the landlord owns and rents ten or fewer such houses.

  • Apartments: Generally, apartments are covered by the VRLTA regardless of the number of apartment units the landlord rents (see exemptions to the VRLTA in Section 55-248.5).
  • Motels/Hotels/Manufactured Homes: Motels and boarding houses are covered by the VRLTA if the tenant lives in such residence for more than 30 days. Some provisions of the VRLTA protect tenants in manufactured home parks.
  • Public Housing and Housing Choice Vouchers (Section 8): Landlord-tenant relations in public housing, Housing Choice Vouchers or Section 8 housing, and other federally subsidized housing are regulated by the United States Department of Housing and Urban Development (HUD). The VRLTA applies to such rentals as long as it is consistent with federal regulations. Tenants in subsidized housing may gain certain rights from the VRLTA in matters that federal regulations do not cover.
  • Single Family Housing: The VRLTA applies to single-family dwellings if the owner owns more than ten dwellings. However, if the owner owns more than four single-family residences or condominium units located within a city or any county having either the urban county executive form (Fairfax) or county manager plan of government (Arlington), the VRLTA applies. Single-family dwellings may be covered under the VRLTA if there is a clause in the lease that states the VRLTA will apply.

Anytime you particpate in an online forum that could negatively impact another person, you need to be very careful and make sure that you are not violating law.  Confidentiality is a serious matter.  Filling out the forms on this particular website is only opening landlords up to liability and potential lawsuits.  The benefits do not outweigh the risks.

The comments on yesterday’s post regarding the potential Catch 22 arising from NAR’s amendments to SOPs 15-2 and (presumably) 15-3 are worthwhile reads.

A few more posts about the topic have popped up for your reading pleasure:

These SOPs aren’t slated to be enacted until January, and as I understand it, there is still an opportunity to amend them, so NOW is the time to raise questions. Several Professional Standards Committee members are watching VARbuzz comments, so please make your opinions known.

They’ll always have Paris

Better them than us.

Oh, gosh, too many snarky comments to make.Paris Hilton a Realtor?
(HOLLYWOOD) – Paris Hilton, famous for being famous, has told the British magazine Tatler that she is considering a career in real estate.

"I’m a brand. I’m a businesswoman,” she said in an interview. “I do everything – I act, I sing, I design, I write books. What I love the most is the business part. I like what it is leading to. I eventually want to get involved in real estate."

Ms. Hilton is a resident of California, where she presumably would be licensed.

If you’re a Realtor blogger, you definitely need to be aware of this new rule.

At their Midyear meetings last week, the NAR Board of Directors approved amendments to the Code of Ethics affecting Realtors who participate in social media. Here’s an excerpt from a NAR newsletter distributed to Realtor association executives this morning:

Standard of Practice 15-2 was amended and a new Standard of Practice was approved to strengthen members’ obligations to refrain from making false or misleading statements about competitors, including in use of social media tools.

The new amendment includes the duty to publish a clarification about, or to remove statements made by, others on electronic media the REALTOR® controls once the REALTOR® knows the statement is false or misleading. For example, if you’re publishing a blog and someone posts a false or misleading comment about a fellow REALTOR® on it, it’s your duty to remove the post or publish a clarification when you become aware of it.

Separately, the board approved a change to the NAR Bylaws, imposing the same duties on associations and MLSs as on members to not make false or misleading statements against competitors, competitors’ business practices, or competitors’ companies.

(The actual amendments to 15-2 have not been made public on yet. If anyone has a copy, please contact me.)

UPDATE: I have been provided a copy of the updated/new sections:

15-2 The obligation to refrain from making false or misleading statements about competitors, competitors’ businesses and competitors’ business practices includes the duty to not knowingly or recklessly publish, repeat, retransmit, or republish false or misleading statements made by others. This duty applies whether false or misleading statements are repeated in person, in writing, by technological means (e.g., the Internet), or by any other means.

(Presumably 15-3) The obligation to refrain from making false or misleading statements about competitors, competitors’ businesses and competitors’ business practices includes the duty to publish a clarification about or to remove statements made by others on electronic media the REALTOR® controls once the REALTOR® knows the statement is false or misleading

Put simply: Once you become aware of comments posted to your blog about a competitor that are either false or misleading, Realtors (and their associations) have a duty to either remove the comment or post a clarification.

Here’s the potential Catch-22

And here’s the obligatory “I’m not a lawyer” disclaimer.

Deleting or editing comments posted to your blog could potentially open you up to legal action. You might be aware of Section 230 of Title 47 of the United States Code. This section of the Code gives Internet publishers certain protections against legal claims arising from content written by third parties (i.e. commenters).

As I understand it from this article on the Section 230 from the Electronic Freedom Foundation, the more Internet publishers take an active role in editing or publishing content posted by third parties, the more likely they are to open themselves up to legal liability.

The good news is, under these guidelines, you have a choice to remove or clarify false or misleading posts. I know what I will do.

Realtor bloggers: How will you comply with this new rule?

Local Governments Thinking “Outside the Box”

With the down turn in the economy and housing market, some localities are looking at alternative measures to help spur activity in the marketplace.  The newspaper in Fredericksburg, Virginia, The Free Lance Star, reports that Spotsylvania County has begun discussions of 9 new initiatives to help rejuvenate the local economy. 

The proposed initiatives are:

  • Designate Business Development Manager Jennifer Mihalcoe and Assistant Planning Department Director Leon Hughes as points of contact for all permit questions from residents and builders.
  • Offer some “over-the-counter” permits online ,such as chimney relining, irrigation systems and converting electric to gas.
  • Accelerate plan review and permitting process.
  • Cut by 50 percent fees on all commercial permits and site plans.  This would require a public hearing.
  • Cut by 50 percent permits fees for single-family homes, decks, pools, finished basements, sheds and garages.  This would require a public hearing.
  • Allow insurance bonding for public projects in addition to letters of credit and surety bonds. Insurance bonding is more cost effective for the business or contractor than providing a large lump sum as credit.
  • Allow one or two days before the county draws funds for letters of credit. Current rules require funds to be drawn immediately. 
  • Reduce cost on single-family lot improvements by as much as $2,000 by allowing engineered erosion and sediment-control site plans to be by written agreement in lieu of actual plans.
  • Waive requirement for a responsible land disturber study.

I see several glaring problems with these “incentives.”  However, I will deal with the fact that these incentives don’t do enough to lower the cost of new construction to facilitate enticing buyers into that market.   The average house price in Spotsylvania County in April 2009 was $196,048.  The most popular price range for Spotsylvania County in April 2009 was $140,000-$159,999.   In April the average sales price for a new construction home was $281,286.  The fact is, building is expensive.  Buyers are looking for the best possible deal.  Today’s buyer also wants a home they can move into in 30-45 days.  Not many buyers have the time to wait for new construction to be built or the finances to pay an existing mortgage or rent payment and carry a construction loan note.  Builders are definitely not sticking their necks out there to build a bunch of spec homes, either. 

I applaud Spotsylvania County and other localities for thinking outside of the box, but I think they need to dig a little deeper.  Focusing on the housing industry at this point may not have the immediate return the county is hoping for.