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May 07

CAR Update: AB1537, Online Auctions, MAR Monday Memo 05/05/14

By Legislation, Marin Association of Realtors, Marin Community News, Marin Real Estate News, Uncategorized

Good morning MAR members!

What a week!  September in April…whew.  I spent last week in Sacramento at the CAR Legislative Day and Spring Business Meetings, and it was hotter here in Marin than in Sacramento.  Frankly, it was downright perfect in the Central Valley, cooler than the last two years when I’ve been there.

Be sure to mark your calendars for next Tuesday, May 13 at 9:30, which is MAR’s general membership meeting at Embassy Suites in San Rafael.  Our guest speaker will be Sarah Sutachan, who is the Manager of Broker and Real Estate Finance Outreach for CAR.  Since I’ve been an MAR member, one of the biggest meetings of the year has always been when Leslie Appleton Young is the featured speaker.  Leslie is CAR’s Chief Economist, and always brought valuable perspective to the statewide and Marin markets.  Leslie, who lives in Los Angeles, is paring down her travel schedule and is somewhat passing the torch to Sarah, who is a valuable member of her staff.  Join me and the rest of MAR’s leadership team to welcome Sarah Sutachan and gain valuable market perspective that you can use in your business today and get the most recent market info for your clients.  MAR member Steve Dickason will also be delivering his valuable ­­Marin Market Update.  Registration is only $10, and it’s open online.  Click here to register online. 

I’d also like to take a moment to share my support for our dear colleague and longtime MAR member Marie Whitemore.  Her 7-year-old granddaughter Gabrielle unfortunately is suffering from a very serious and inoperable brain tumor.  This little girl just underwent chemotherapy and is now beginning a more aggressive treatment…an expensive treatment that is not covered by insurance.  The Talbert family from the peninsula had a similar situation with a family member battling a similar condition, and the Talbert family has generously offered to match every donation dollar-for-dollar.  I’d like to encourage all of us to support the family however we can.  For more info, please click here .  The entire MAR family’s thoughts and prayers are with Marie and Gabrielle.

And what a week in Sacramento.  Lots of CAR business before the legislature, I’ll get that legislation next week.

The big day for me was Wednesday, where MAR CEO Andy Fegley and I attended and testified at two different Assembly committee hearings in support of Marin Assemblyman Marc Levine’s bill AB1537, which relates to the minimum density for housing developments in much of Marin.  Levine’s bill lowers the minimum density from 30 units to 20 units/acre.

Currently, Marin is lumped in with San Francisco and Oakland as being “metropolitan” and is something of an anomaly in the Bay Area with minimum zoning at 30 units per acre.  I knew that Sonoma and Napa were designated as “suburban” at 20 units/acre.  What I didn’t know is that Santa Clara County…the Bay Area’s most populous county…is also designated “suburban” at 20 units/acre.

Levine’s bill corrects that anomaly and re-designates Marin as “suburban” at 20 units per acre.  Last Wednesday, Andy and I, along with Supervisor Kate Sears and members of Bridge Housing and other agencies that historically have been against this type of change joined forces to support Levine’s bill.  AB1537 passed unanimously through the Housing Committee and then passed through the Local Government Committee.  MAR testified in support at both meetings.

MAR strongly supports this bill, and we are doing everything we can to assist Assemblyman Levine’s efforts to win passage.  The bill has progressed further than similar bills have fared in the past, and we plan to continue our efforts to support its passage.

The most fascinating session of the week at CAR was the Public Policy Forum.  The topic was online auctions.  Rick Sharga, the Executive VP at Auction.com generously made himself available for this meeting, which was absolutely packed and standing-room-only.  And I learned SO MUCH!

(this is a long account, sorry, but so much valuable info was shared and all the MAR members are talking about auctions)

-Auction.com sold 35,000 properties online last year, with the vast majority going to investors.

-Auction.com is a licensed broker in 48 states.

-Google just invested $50M in Auction.com, and now owns a 4% stake.  That investment values Auction.com at $1.2B.  Google will be helping Auction.com improve its mobile platforms.

-Speaking of mobile, Mr. Sharga shared a story about an investor in India who learned that he won an auction.  He contacted Auction.com to verify that he could finalize his cash purchase on his phone.  From India.

-It’s written into their Auction.com’s contract that “shill” bidders are part of the process.  Mr. Sharga’s first response was that “shill is such a nasty term.”  They call it “seller bidding”.  It’s perfectly legal, but ethically dubious in my opinion.  Meaning, if the auction slows down, or doesn’t get to the reserve, Auction.com will place a shill bid, in an attempt to get you to bid higher. It’s not a real bid, and thus you are competing against yourself.  Can you imagine?  In my mind, that’s the same as a listing agent telling you there is “another offer” or “multiple offers” when there really isn’t one.  Gigantic breach of our REALTOR Code of Ethics.  But since Auction.com is not a REALTOR member, the Code of Ethics does not apply.  CAR currently has sponsored a bill before the legislature to outlaw shill bidding.

-That 75% of Auction.com’s business is generated by investors.

-That most of Auction.com’s clients are not interested in anything other than cash buyers.

-That Mr. Sharga himself declared that Auction.com was “not ready for the consumer market.”

-In regards to CAR-sponsored legislation AB2039, Mr. Sharga admitted that “our contracts need work” and “we were never set up to work with consumers.”  AB2039 seeks to prohibit the current practice of indemnification clauses in the cases of short sale lenders seeking to use Auction.com to “verify” the short sale price.  As many of you know, Nationstar has been incorporating this “verification” process as part of their standard short sale process.  As the listing agent, you are required to sign a contract that indemnifies Auction.com of any liability during this auction process.  Net-net, as the listing agent, you and your broker are carrying the entire liability for any wrongdoing by Auction.com, even though at that point in the process Auction.com basically controls the listing.  AB2039 prohibits this indemnification practice, and CAR is working very hard for its passage.

-Among other investors, Auction.com and Nationstar happen to share a single common investor.  Go figure.  Fortress Investment Group is the majority owner of Nationstar, and Fortress Investment Group is also a major investor in Auction.com.  Mr. Sharga called that a “coincidence”, and said that there is no financial relationship between Auction.com and Nationstar other than the “buyer’s premium” that Auction.com is awarded when a property sells through its platform.  So he says.

-Mr. Sharga didn’t want to comment on a similar arrangement that has resulted in a current investigation where Benjamin Lawsky, superintendant of the New York Department of Financial Services is seeking to clarify the relationship between another auction site, Hubzu, and mortgage servicing firm Ocwen Financial.  Seems that Hubzu was spun off from Ocwen in 2009.  Mr. Sharpa encouraged us to Google Mr. Lawsky’s investigation of Hubzu.  It’s quite an interesting search, you should Google it yourself.

-Mr. Sharga shared that the reason for this short sale price “verification” is because the “servicers feel that they’re getting ripped off.”

Which brings us to…

-In regards to the new practice of loan servicers in short sales requiring the property to go onto Auction.com to “verify” the price, in California 75% of the properties that go through this verification are sold to someone other than the original offeror, with a 15-20% “uplift” in the price.  He was pretty adamant about that “uplift”.  Mr. Sharga answered a question that I had:  if the original offeror on the property has to increase his/her price to get it via the auction, that person does NOT have to pay the 5% buyer’s premium.  That’s about the only good thing I heard at this session.

-For many auction properties, Mr. Sharpa acknowledged that there is a current disconnect between the initial bidding price and the actual reserve.  Meaning the property is actually not for sale at the price that is entered into MLS.

The meeting went on and on and on, to the point where they had to stop it with many people still in line to speak.

Next week, I’ll give you a rundown of the rest of the CAR meeting.

That’s it for now.

I wish you a safe and prosperous week!

Blaine

Mar 31

Housing Density AB-1537, Matt Hughes voted as President-Elect of MAR, MAR Monday Memo 03/31/14

By Legislation, Marin Association of Realtors, Marin Real Estate News

Good morning MAR members!

As I write this on Friday afternoon, it seems that we’re in for a soggy weekend.  Sunday appears to be mostly dry, so hopefully your open houses weren’t a washout…but the long awaited “Miracle March” for our water supply may well be coming together these last few days of the month.

It was a busy week at MAR!  Last week, MAR President-Elect Nate Sumner alerted me that due to some unexpected circumstances he will be unable to fulfill his responsibilities as MAR President next year.  MAR Bylaws call for a simple majority of the Board of Directors to replace any Board or Executive Committee position.  Luckily for MAR, we’ve built a deep “bench” over the past few years, and I’m pleased to announce that the Board of Directors voted unanimously on Friday to appoint MAR Secretary and Executive Committee member Matt Hughes as 2014 President-Elect.  Matt will serve as your 2015 MAR President.  Matt is the right man for the job, and we are all lucky that MAR was able to fill this important position at a very important time with such a well-qualified candidate.  Please join me in congratulating Matt Hughes!

Last Friday, MAR CEO Andy Fegley, MAR Treasurer Arun Burrell and myself all paid a visit to Assemblyman Mark Levine’s office in San Rafael.  It was important to make the introduction of CEO Fegley, and we also wanted to express MAR’s strong support for Assemblyman Levine’s bill, AB 1537, which lowers the potential density of future Marin housing developments from 30 units per acre to 20 units per acre.

This potential density is at the core of many of the spirited discussions we’ve had here in Marin over the past year…and discussions we continue to have.  In addition to expressing our support for his bill, MAR also asked Assemblyman Levine what we can do to help.  Assemblyman Levine was delighted to learn of our support, and these conversations are ongoing.

Housing density has been one of the key debates in our community over the past year, and I expect it will be for the foreseeable future.

The debate on housing reached a fever pitch last summer with the debate over Plan Bay Area.  These spirited discussions continue to this day.  MAR’s Board of Directors voted last May to oppose Plan Bay Area, on the basis that it circumvented local control.  MAR was one of the earliest organizations in the county to oppose the measure, and we voiced our opposition to the Board of Supervisors, and publicly in an op-ed in the Marin IJ.

The housing density that was and continues to be dictated to us from outside the county was an easy issue to oppose.  Local leaders should have the final say on local planning decisions.  Much more complicated, however, have been the individual Housing Element plans that each municipality and the county overall have been crafting.  These are complex plans, with an enormous amount of detail that each town has invested a great deal of time to complete.  There was really no way for MAR to become experts on each housing element given the voluminous nature of each plan.

In addition, MAR has not had a policy regarding housing in the context of the current debate.  Until now.

MAR’s Government Affairs Committee is where these issues have been explored.  We’ve been talking about housing for the better part of a year now, and it comes up at nearly every meeting.  MAR has shared our position on the 30-units-per-acre density with every elected official who has come before us.  Many of you have come before this committee to share your position on the subject.

Honestly, we could spend every monthly Government Affairs committee meeting solely on housing during this critical time.  Earlier this year, MAR’s Board of Directors created the Housing Density Subcommittee under the Government Affairs Committee to focus on these issues and free up the main committee to be able to review other issues in addition to housing.  Missy Crowe was named to Chair this subcommittee.

The first order of business was to craft a Housing Policy for MAR to utilize to inform its decision making process going forward.  I’m pleased to announce that the Housing Density Subcommittee crafted and approved this policy statement.  The Policy Statement then worked its way through the Government Affairs Committee and finally the Board of Directors voted to approve the statement last week after several modifications.  You can read the MAR Policy Statement on Housing Density here.

One of the keys to this Statement, and to the process we are all witnessing, is transparency.  The public needs to know what’s going on, and to have the ability to participate and provide input.  This is increasingly what is occurring, and the voters of Marin County will ultimately have the opportunity to hold their elected officials accountable on this subject.

MAR applauds the ongoing participation of the public on this debate.  Many of MAR’s members have taken outspoken positions, which is fantastic.  Participate in the public process in Marin County, MAR members!  Make sure your voices continue to be heard, regardless of your position.

In other news, the California Association of REALTORS Spring Business Meetings are coming up at the end of April.  I encourage all of you to participate in Leg Day in Sacramento on Wednesday April 30th.  If you make it to the morning session, you will have the opportunity to hear Governor Jerry Brown, who will be addressing CAR.  It’s a truly exciting event, and going to Sacramento to participate in the Business of the People is an experience that is difficult to explain short of doing it.  The REALTOR Party making our voices heard!  If you’ve never been, consider making the investment of one day to see your statewide association in action.

MAR’s representatives on the CAR Board of Directors need your feedback, as always.  In addition to myself, MAR’s CAR Directors include President-Elect Matt Hughes, Kay Moore, Mary Kay Yamamoto, and Katie Beacock.  Katie is also the Chairperson of CAR Region 4, of which MAR is a part.  If you have anything on your mind that you think our leaders at CAR need to hear…or that you think our elected leaders need to her…please seek out one of us via phone or email.  That’s the most important thing we do at CAR:  make sure the voices of our MAR members…YOUR voices…are heard at the statewide level.

That’s it for this week.  Again, please join me in congratulating MAR’s 2014 President Elect, Matt Hughes.

I wish you a safe and prosperous week!

Blaine

Mar 24

Salmon, Resale Inspections and the Ongoing Flood Insurance Conversation. MAR Monday Memo 03/24/14

By Legislation, Marin Association of Realtors, Marin Community News, Marin Real Estate News, Regulations

Good morning MAR members!

Spring is here, even though it’s felt like spring all winter.  I saw in the paper the other day that we just had the warmest winter on record for California…it really didn’t feel that way in December and January, when it was in the mid 20s every night at my house for about six weeks straight…no rain and frigid night temps killed much of my landscaping.  The citrus trees hated it.  That’s well behind us now, and the weather has been phenomenal for much of our winter.

Multiple offers all around.  Two offers, five offers, ten offers, more?  Every property of interest to my buyers is a brutal competition.  We seem to have more listings, and the data bears that out, but whether it’s in the flats or in the hills, it seems like every house on the market has plenty of buyers as long as it’s priced correctly.  Let’s get our sellers off the fence!

One final reminder for the Celebration of Catherine Munson’s life.  It will be held at the Marin Veteran’s Memorial Auditorium at the Marin Civic Center in San Rafael, this Thursday, March 27.  Doors will open at 1:00 pm, the service will begin at 2:00 pm, with music, food and joy to continue afterwards.  In lieu of flowers, the family prefers donations to Project Amigo, 14 Commercial Blvd., Suite 199, Novato, CA  94949.

This has been a truly amazing time to be the leader of MAR and to be able to witness firsthand the profound impact that Catherine has had on so many of our members and the community.  She touched so many in so many ways.  In meeting after meeting, people have shared heartfelt anecdotes about Catherine, and she will be missed very much.

On to what’s happening this week:

Salmon, resale inspections and the ongoing flood insurance conversation.

At my request, over the past couple of weeks, Donna Lahey of MAR staff performed a lot of due diligence with the county about where we sit right now in regards to the Marin County Streamside Conservation Ordinance.  As you may know, this is an ordinance that MAR opposed last year due to its vagueness, arbitrary rules, and compromise of private property rights throughout unincorporated Marin.

With all of that said, it was passed by the Board of Supervisors last year, and the Marin County Streamside Conservation Ordinance was the law of the land.  There have been several appeals, however, and two weeks ago the ordinance was sent back to the Board of Supervisors by the California Court of Appeal on the grounds that the Environmental Impact Report (EIR) was not thorough enough; the courts ruled that the impacts of long-term development on the salmon populations was not taken into enough consideration.  So the courts sent it back to redo the EIR.  The Court of Appeals also ruled that the prior building moratorium in the San Geronimo Valley was not valid either, and so no more building moratorium.  That is great news, and it looks like the building moratorium won’t come back around.

The upshot of this is that the 2007 Marin County General Plan, of which the Streamside Conservation Ordinance is a part, has been blown up as it relates to the San Geronimo Valley.  Rather than the 2007 General Plan, now the 1994 General Plan is the law of the land in the San Geronimo Valley.

Stay with me here.

As best as we can verify at the County, the building guidelines of the 1994 General Plan are in effect in the San Geronimo Valley.  Curiously, the guidelines of the 2007 General Plan are in effect for the rest of unincorporated Marin County.  The Streamside Conservation Ordinance has been declared invalid.  And the San Geronimo Valley building moratorium was declared invalid and thus no more building moratorium.

What I’ve been trying to get at is, “How in the world do we advise our clients and property owners?”  I had a camo this week in the San Geronimo Valley, and a couple of the top agents in the Valley told me that “No one knows what’s going on.”  You think?

The question that I had…which is still not answered by the county:  Let’s say I have a house in the Valley.  Let’s say I want to do something (repair my deck, add some space, rebuild my driveway, etc).  What rules am I operating under?  According to the County’s press release (click here to read:  http://www.marincounty.org/main/newsroom/press-releases/2014/eir-ruling), it’s the 1994 planning guidelines.

So let’s say I start a permitting process in the Valley under the 1994 guidelines, and before I’m done, this all gets resolved…do I get to finish my project under the 1994 guidelines?  Or will it be the 2007 guidelines?  Or will there be new guidelines?  I still cannot answer that question.  MAR’s Donna Lahey was interacting with Brent Ainsworth, the County’s Public Information Officer.  His response to this question was: “We’re still working on an answer to that other question. The court ruling is so fresh, the answer is being hashed out among our attorneys and community planners. We’ll try to get back to you soon.”

Again, as I understand it, other unincorporated areas like Sleepy Hollow, Marinwood, Kentfield, Tam Valley, etc, are still under the 2007 General Plan…minus the Streamside Conservation Ordinance.

Confused?  So am I.  Sorry for the incomplete info, but I think we need to be talking and thinking about all of this.  I think it’s best to advise our clients that there are a lot of moving pieces that will hopefully become clearer in the coming weeks and months.

More on resale inspections

Lots of feedback from members on my comments a couple of weeks ago about one of our large municipalities that is busy “cleaning up past mistakes” and engaging in “double jeopardy.”  The staff in this town seems to be admitting as much:  “we made mistakes in the past, now we’re trying to correct those mistakes.”  Thank you to Matt MacPhee for coming to MAR’s Government Affairs Committee meeting last week during “open forum” time to detail the challenges he is having with this building department.

This kind of feedback is essential to MAR, and best delivered in person during “open forum”, which we have at 9:00 AM before both the monthly Government Affairs Committee meeting and also before the monthly Board of Directors meeting.  This is YOUR association, and we welcome and encourage you to come in and tell us what’s going on.  About anything.  PLEASE take advantage of this, emails are great, but there is no substitute for the color and detail that our members can provide during this open time, and it allows for valuable Q&A.

MAR is focused on ensuring that the building officials and elected officials in our Marin municipalities know the value of our Fair Principles of Resale Inspections.  We are working on getting the leadership of this municipality in question to come in and tell us what they are doing and why they think it’s ok.

Flood Insurance Update

Good news!  According to NAR, last Friday, President Obama signed the “Homeowner Flood Insurance Affordability Act” into law.  This law repeals FEMA’s authority to increase premium rates at time of sale or new flood map, and refunds the excessive premium to those who bought a property before FEMA warned them of the rate increase.  The bill limits premium increases to 18 percent annually on newer properties and 25 percent for some older ones.  Additionally, the bill adds a small assessment on policies until everyone is paying full cost for flood insurance.

That’s it for now.

I wish you a safe and prosperous week!

Blaine

Mar 17

General Membership Meeting Highlights, Flood Insurance Update – MAR Monday Memo 03/17/14

By California Association of Realtors, Legislation, Marin Association of Realtors, Marin Real Estate News

Good morning MAR members!

Happy St. Patrick’s Day.  Please enjoy your green beverages and snacks in moderation!

Spring is here, believe it or not!  The official first day of spring is Thursday, but it’s felt like spring real estate for a couple of weeks here in Marin.  Just as agents were lamenting an “inventory crisis”, here comes the inventory.  At our MAR General Membership meeting last Tuesday, Steve Dickason shared that we have 2.5 months of inventory in Marin right now, and that’s the most in 15 months.  I personally was scrambling to see all the places on tour this week, and I expect most of you feel the same way.  Let’s keep those listings coming MAR!

Speaking of last week’s General Membership Meeting, we had another sellout!   Thank you for all of your positive comments about the program and our efforts at MAR to provide you with timely and relevant information to use in your business and share with your clients.

Some highlights of the meeting:

  • Per Steve Dickason, with a year to year comparison, in Marin pendings are down 13%, listings are up 13%, and closings are down 10%.  That sounds to me like short inventory earlier in the year with things starting to turn around.
  • Also per Steve, average days-on-market for closed sales this year are 64 DOM; last year it was 92 DOM.
  • Another anecdote that I found interesting:  30 years ago in California, there were 5 Realtors for every lawyer.  Now there are two lawyers for every Realtor.  So be careful out there, and keep a tight file.
  • Guv Hutchison from the CAR legal department was our keynote speaker, and he had an enormous amount of useful info.  An interesting new law that started this year on January 1 is a change in the 140+ year-old law involving fences: in the past, if you and a neighbor shared a fence, and one property owner wanted to replace the fence, that property owner could ask the other property owner to split the cost…and the person receiving the request could basically ignore that request, “…the fence looks fine to me!”

    Now, the requesting property owner can give a written request, and the recipient of that fence request has 30 days to dispute that claim.  If the recipient homeowner ignores that request, after 30 days the requesting homeowner can demand that the cost be shared, and the recipient homeowner must share in the cost.  The only remedy for the ignoring homeowner is to litigate that request.  Another reason, I suppose, why we need two attorneys for every Realtor.

  • Another item that Guv shared is the routine situation in Common Interested Developments (condos, townhomes, PUDs) where the CC&Rs say one thing, the Articles of Incorporation say another thing, the bylaws say something else, and the “rules” say something different.  A common issue relates to pets:  number of pets, kinds of pets, size of pets, what breed of dog, etc.  Well, there seems to be a hierarchy of these documents:  the “rules” are lowest on the totem pole; rules are superseded by the Bylaws.  The Bylaws are superseded by the Articles of Incorporation.  And the Articles of Incorporation are superseded by the CC&Rs.  Ultimately, the CC&Rs are the controlling document, they supersede all.  I see this being the foundation of some lively neighbor conversations if the word gets out!
  • Another interesting issue relates to medical marijuana.  If a landlord has a “no smoking” policy, can that landlord also prohibit medical marijuana?  According to Guv, yes, that landlord can also prohibit smoking medical marijuana.
  • Another new law relates to tenants in homes that are for sale.  In the past, we’ve all used the “24-hour notice” guideline.  Well, the new law says that tenants are entitled to a 10-day notice for an open house.  So we’re going to need to be a bit more organized as Realtors.  Yikes…
  • Finally (and this is not an exhaustive list), relating to SB-407, the water conserving fixture retrofit law that I spent a lot of time educating the membership on earlier this year.  Several brokers and at least one attorney have told me that the current disclosure language we have in the RETDS about SB-407 is insufficient, there needs to be more.  Well, I asked Gov that question, and he said that he feels that the disclosure language in the RETDS is in fact sufficient.  He seemed pretty confident in his position.

Flood Insurance Update

The flood insurance saga continues, but relief is in sight.  Several mortgage and insurance brokers confirmed to me this week that yes, the Natural Catastrophe Insurance Program (NCIP) which is underwritten by Lloyds of London is a viable and economically reasonable flood insurance solution if FEMA has crazy rates or needs an elevation certificate.

Even bigger news is that the US Senate overwhelmingly passed the House’s Flood Insurance Reform legislation.  This is great news.  The following is what I received last Thursday from Chris Gosselin, NAR’s Senior Political Representative for our area:

“The US Senate overwhelmingly passed the bipartisan flood insurance reform legislation  that the House approved earlier this month by a 72-22 margin. The President is expected to sign the legislation in the next few days.

The legislation that passed today:

  • REPEALS (the original Senate bill only delayed) the property-sales provision in the Biggert Waters law (sec. 205) that has triggered the most excessive and inaccurate premium increases over the past year.
  • REFUNDS (the original Senate bill would not refund) excessive premiums to those who have already seen an increase but were not warned by FEMA prior to purchasing the property.  (This would apply to ALL purchases of property including purchases of a second home or commercial property).
  • RESTORES (the original Senate bill only delayed) the grandfathering of lower rates when new flood maps are issued by repealing Section 207 of the law before any increases can be implemented.”

So I guess they heard us!  Thanks to everyone who shared important flood insurance feedback, which we at MAR were able to share with Congressman Huffman and also up the chain at CAR and NAR.

There is much work and clarification to be done…we need to see how and when this is all going to get implemented, but the good news is that help is on the way!

Opportunity to meet Joel Singer, CEO of the California Association of Realtors

Thank you to Jean Ludwick, a Broker Associate at Alain Pinel.  She asked me to get the word out that the Council of Real Estate Brokerage Managers (“CRB”) is hosting a luncheon on Monday April 21st at the Acqua Hotel in Mill Valley from noon-1:45PM.  Joel Singer, the CEO of CAR, will be the keynote speaker, and Joel will provide an overview of the current housing market conditions for the state of California and the Bay Area, and will share his outlook and forecast of the market for the rest of 2014.  A light lunch will be served, and it’s FREE.  Jean is the President of the Northern California CRB, and she wanted me to invite everyone, not just brokers.  So agents, feel free to sign up!  If you’ve never heard Joel speak, this is a great opportunity to hear one of the leading minds in our industry.  I for one plan to attend.  Please rsvp by email to jbanuat@coldwellbanker.com.

That’s it for now.

I wish you a safe and prosperous week!

Blaine

 

 

 

 

Mar 03

Flood Insurance Increases and Legislation – Blaine Morris’ 2014 President of Marin Association of Realtors 03/03/14 Monday Memo

By Legislation, Marin Association of Realtors, Marin Real Estate News

Good morning MAR members,

Happy March, happy almost-spring!  In addition to our needed rain, as I had hoped, lots of new listings this past week.  One of our colleagues was quoted in the Marin IJ this past week characterizing Southern Marin as being in an “inventory crises”.  Let’s hope our sellers see this and get off the fence.

I’m hoping to see all of you at our MAR General Membership meeting next Tuesday.  It is at 11:30 at Embassy Suites in San Rafael.  It’s our MAR Annual Meeting, and our featured speaker is Gov Hutchinson, who is the Assistant General Counsel at the California Association of REALTORS.  Gov is on the front lines of the newest and timely risk management issues of selling real estate in California, and it’s always a popular meeting because he gives us this info with real world stories that we can apply to our business today.  Also presenting will be our colleague Steve Dickenson for his always-useful Marin Market Update.  Click here to register:

Thank you for all of your comments this past week about last week’s agent safety message.  Everywhere I went last week, people were sharing stories about unseemly experiences at open houses.  Many of us just stow these away, I’m glad we’re talking about it.  Be safe out there!

Last Thursday evening, I had the pleasure of attending meetings with two important REALTOR groups here in Marin, both of which are open to all.  The first was the Marin REALTORS Young Professionals Network.  This group is just getting off the ground, and they had their second monthly meeting at Wellington’s Wine Bar in Sausalito.  Our colleague CJ Nakagawa is the 2014 Chairman of the Marin REALTORS YPN group, and he and his advisory committee are doing a tremendous job launching this needed group that fosters the professional development of our newest members.  Plus, they have a lot of fun and network for the benefit of their individual businesses.

Patty Oxman was kind enough to share a presentation at YPN on how to create a repeat and referral business.  Patty is one of our busiest and most respected colleagues, and it always amazes me how giving she is to share her best practices with other agents.  I last heard this presentation nearly eleven years ago when I was just getting into the business, and the same fundamentals that Patty teaches apply today.  Service to our fellow agents is one of the most important things we have to share in our business, and I’m so thankful for top producers like Patty giving their valuable time to help others in the business get better.  Thank you Patty!

The second meeting on Thursday was with our colleagues at Womens Council of REALTORS.  This was a well-attended mixer and everyone had a great time!  WCR is hosting their monthly meeting this next Tuesday, March 4th, for a breakfast meeting.  The featured speaker will be Janice Niederhofer, who will be presenting “Top Secret Strategies of Business Success.”  Ms. Niederhofer is a “top secret” woman herself, who has taught interrogation techniques to the CIA, FBI and many other top agencies.  This sounds like super interesting material, and info that you can use in your business today since we all need to get creative on how we gather information.  Click here to register:  https://www.eventbrite.com/e/wcr-marin-presents-top-secret-strategies-turn-your-fear-into-an-advantage-tickets-9058158195?ref=enivtefor001&invite=NTI1MDMyOS9ibW9ycmlzQGZoYWxsZW4uY29tLzA%3D&utm_source=eb_email&utm_medium=email&utm_campaign=inviteformalv2&utm_term=attend&ref=enivtefor001

Now, on to this week’s topic:  flood insurance.  I must admit, most of my listings are not in a flood zone, and I’ve paid attention to this topic only when in escrow.  We all have some brushing up to do, things are changing and we should all work to learn more about this subject.

Several weeks ago, I visited with Congressman Jared Huffman along with our MAR colleagues Kay Moore and Katie Beacock.  Kay is NAR’s “key contact” with Representative Huffman, and Katie is Chair of CAR’s Region 4, of which all of Marin is part.  Leading up to the meeting, I was asking agents if there was anything that should be brought to Rep Huffman’s attention.  We have to focus on things that have national oversight:  mortgage interest deduction, flood insurance, etc.  Boy, did I get an earful from everyone about flood insurance.  What a messy, in-between stage we find ourselves at right now!

I shared some real world stories with the congressman.  One local firefighter whose flood insurance on his recently purchased home just jumped from $1800 to $6000 per year.  Another escrow that fell apart in San Rafael because the flood insurance was going to increase from under $2k to over $14k.  These stories are everywhere, and Congressman Huffman listened with great interest.

Flood insurance is being legislated at the highest level of our government right now.  On January 30th, the US Senate passed a bill that will delay many of these sharp increases for up to four years.  The bill is now in the House, and I expressed to Congressman Huffman that these gigantic increases are proving very troublesome for many of his constituents.  Forget about someone trying to buy a new home, how about people on fixed incomes who are seeing these rates triple, or quadruple or more.

We’re hoping that the House is poised to pass this bill.  And President Obama will need to sign this bill as well.

A key new component in the listing and selling of flood-zone properties is the regularly-needed “elevation certificate”.  In the past, elevation certificates came up often if homeowners wanted to try to get a reduction or removal of flood insurance.  Now it seems that it’s become standard practice to require this report as part of getting flood insurance, unless you are willing to pay the very highest rate.

Because many rates have gone up so much, the elevation certificate could possibly help to get the cost of insurance back to a manageable level.  This may well become a new negotiable closing cost.  And an elevation certificate isn’t cheap, it can cost more than $1000, sometimes up to $2000.  Nor do you get one quickly.  And sometimes the insurance company will require modifications to the house itself, such as venting, before they will issue a policy…and they want it done before close of escrow.  Plan accordingly in your escrows.

MAR is going to continue to seek clarity on this matter to get you the timely info to conduct business, stay tuned.  I’m sure your brokers can help too.  Again, I’m not an expert, and I’m working to get educated.

Finally, again, lots of feedback on the emerging auction business for real estate in Marin.  Many of you have asked about BAREIS MLS’s policy on compensation in the MLS.  They are under the same requirements as MAR, we don’t get involved in compensation issues.  I invite all of you to review item 11.1 of the BAREIS MLS Rules and Regulations, it’s linked on this page on the BAREIS website:  http://bareis.com/rules.  It’s pretty clear.  Please keep your auction stories coming!

I wish you all a safe and prosperous week!

Blaine

Feb 22

Short Sale Auctions, SB-407 Water Conserving Fixtures Update – Blaine Morris’ 2014 President of Marin Association of Realtors 02/17/14 Monday Memo

By Legislation, Marin Association of Realtors, Marin Real Estate News, Regulations

Good morning MAR members!

Happy President’s Day…which in Marin means Happy Ski Week!  Everybody sure seemed to be going somewhere last Thursday night, as I was trying to get to a dinner meeting in downtown San Rafael (well after rush hour) and it was absolute gridlock with people trying to get on 101 North…so I hope those of you on your way to a family ski vacation are having a fantastic time!

For those of us still here this week, another week in Marin, another week of low inventory.  Buyers are out there, as we all know.  Increased inventory will be good for everyone, so let’s get our sellers off the fence!

My weekly SB-407 water conserving retrofit update is below, lots of new info, and some qualified good news.  This week, I’ve put it down at the end of the memo so people don’t think that’s all I talk about every week…

AUCTIONS

Oh my goodness, lots of feedback on auctions.  Several weeks ago, I shared that CAR is going to “SPONSOR” legislation to require an auction company to indemnify or “hold harmless” the listing broker in a transaction against liability that results from the auction company’s actions in a short sale transaction.

As I said, this was the big story that everyone at last month’s CAR meeting was talking about.

Here is the genesis of this issue:  it is becoming an increasing practice that as part of a short sale approval, some banks/servicers are requiring that before an approval is granted, the property needs to be put out on an auction site to “verify” the price.  There is one servicer in particular who is doing this a lot.  As part of this process, the original listing broker is asked (required?) to abrogate the listing agreement to the auction company…then the auction company runs with the auction and essentially the listing.

But the original listing broker still has agency with the seller, and also has an agency disclosure with the buyer.  What happens if, as part of all of this, mistakes are made by the auction company during the transaction?  I know of one of these auction companies that is legitimately licensed with the State of California as a licensed broker, and I’m sure there are more.  If something goes wrong, who is then liable?  Whose E&O pays?  This is the root of the above “SPONSOR” position on legislation to get indemnification of the original listing broker by the auction company.

But wait, there’s more.  What does all of this say about a broker’s legitimate listing contract with a seller?  Does the bank have the authority to demand that a listing broker abrogate its legitimate contract with a seller to proceed with this deal?  It becomes a larger question about the overall legitimacy of our listing contract.  CAR is looking into this as well, and I must say it’s a hot potato issue.

CAR is looking for specific anecdotes…war stories.  Here is what they are looking for:

“We are looking for any anecdotes where a licensee may have been sued due to the negligence of an auction company. We are also looking for stories, where to avoid legal action, a licensee has taken financial responsibility for the error of an auction company. And finally, we are looking for any instances where licensees have been informed by their E & O carrier that if an auction company were to make an error and the REALTOR® was held responsible for it, that the event wouldn’t be covered under the policy. It would also be helpful to know which E & O carrier was involved.”

Can any of you help with this?  If you have any of these stories personally, or if you know of someone else who does, please contact me here [mailto link].  It’s important that we communicate what is happening on the ground here in Marin to our statewide association.

SB-407 WATER CONSERVING FIXTURES UPDATE

I recently directed MAR staff to survey the various Marin municipalities about each town’s plan for implementation of SB-407.  The question is whether our building departments are planning to follow the California Building Officials (“CALBO”) recommendation that permits for repairs and maintenance of homes are EXEMPT from the retrofit requirements.  After surveying most of our towns, it does seem that they are going to follow that recommendation.  Here is a link to CALBO’s position (see second page):  http://www.calbo.org/uploads/NoCal%20Policy%20Memo%20SB%20407%20%28Dec%202013%29.pdf

In addition, another concern is whether unclosed permits from prior years will require a retrofit when they are closed after the fact…sometimes years later…often as part of a real estate transaction.  To my great relief, those that we have spoken with have said “no”, old unclosed permits should not trigger a retrofit requirement since the permit was pulled prior to the new code.

Each town kept pointing to a meeting this week among the building officials, the Code Advisory Board meeting.  Their plan is to coordinate a uniform policy county-wide.  There are some minor differences around the edges, but let’s await the results of this group’s meeting to confirm that those differences are smoothed out

The current RETDS does have some brief language mentioning this new code, but I’ve received a number of comments that this language is inadequate.  CAR is working on it, and MAR is monitoring the situation closely with our General Council to make sure that we can advise our clients correctly.

As I keep saying, stay tuned.

I wish you a safe and prosperous week ahead!

Blaine

 

Feb 19

More on SB-407, Housing Density AB-1537 Legislation and More – Blaine Morris’ 2014 President of Marin Association of Realtors 02/10/14 Monday Memo

By Legislation, Marin Association of Realtors, Marin Real Estate News

Good morning MAR members!

With the Super Bowl behind us, it was great to get out on tour this week to see the beginnings of our inventory for the spring home buying season.  Even though our winter rains finally seem to have rolled in, the daffodils  blooming (early) in my front yard point to spring right around the corner!  Buyers were out too, with agents reporting lots of activity.  Let’s all hope for more inventory to go along with more rain!

More on SB-407

My weekly updates on SB-407 will continue until we have clarity on the rollout.  This is the new water conserving fixtures legislation.  MAR is contacting the various municipalities to confirm local rollout plans.  I also spoke this week with one of the leaders of the local building official group, and he said that a consistent policy will be available after their next meeting a week from Wednesday on February 19th.  Stay tuned.

Speaking of SB-407, I received an email this week from MAR’s attorney, who reminded me about the “bill that no one is talking about, SB-407.”  After ensuring him that we are indeed talking about it, at least in Marin, he shared a couple of groups’ interesting interpretations of the law.  First is the California Contractors State License Board, which operates under the same Dept. of Consumer Affairs as our Bureau of Real Estate.  A bulletin from this group states, in part, that “Although not a legal opinion, the California Building Officials (CALBO) group has interpreted ‘alterations’ or ‘improvements’ to mean any construction to an existing structure that enhances or improves the structure. Construction that is related to repairs or maintenance of the structure is not considered to be an alteration or improvement.”

The bulletin goes on to say that items such as electrical service change out, HVAC change out, re-roofing, sewer line replacement, siding or stucco, retaining walls, fences, water heaters, windows should not trigger the retrofit requirement.  Near the end, the bulletin says “It is feared that property owners and licensed contractors who misunderstand the law may end up paying for new fixtures that are not required, or may avoid pulling building permits altogether to avoid the possible triggers to SB 407.”

You can read the full bulletin here:  http://www.cslb.ca.gov/GeneralInformation/Newsroom/IndustryBulletins/IndustryBulletins2014/IndustryBulletin20140117.asp

Again, this is not legal opinion, but since contractors look to be among the beneficiaries of this program, it’s refreshing to see their state board pull things back a bit.

The very comprehensive California Building Official’s group’s bulletin referenced above is here:  http://www.calbo.org/uploads/NoCal%20Policy%20Memo%20SB%20407%20%28Dec%202013%29.pdf

MAR will continue to advocate to our local building officials for clarity on this rollout.

A couple of odds and ends:

While scrambling up the mountain to see a new listing off of Panoramic Highway in Mill Valley on Wednesday’s broker tour, I was reminded of several emails I received from aggravated members last year.  This first broker’s open house was closing at 1:00, so in order to see it I needed to carve out a half-hour plus in the middle of tour to see this one property.  The members who contacted me last year identified a growing trend in our MAR community:  the shortened brokers’ open.  I wasn’t part of the “which hours on which days in which towns” discussion many years ago, but the convention that everyone agreed to was the following:  Wednesdays from 9:30-12:30 in Novato; Wednesdays from 10:30-2:00 in Southern Marin, and Thursdays from 10:30-2:00 in Central Marin.

Yes, it’s pretty simple, and yes I know we all know this.  I can understand the occasional 11:00 start times, I’m personally guilty of this sometimes, given that many of us have sales meetings on Thursday morning.  But why all the 1:00 close times…particularly on the first brokers’ open house?  I’m sure each of us can think of circumstances where you have to make some hard decisions about which houses you’re going to miss because you have to scramble across the county to see that ONE place you must see that closes at 1:00.  People grumble about this all the time.  Yes, I know sometimes we’re not worried about it, in this brisk market…yes, I know your listing is going to get multiple offers and you’re not worried.  But let’s be courteous to our fellow Realtors, and keep the house open until at least 2:00…at least the first week.

Correction

Thank you Colleen Frasco for identifying an error in last week’s Monday Memo.  I mentioned that on the recommendation of CAR’s Taxation and Government Finance Committee meeting, the CAR Board of Directors voted to “SUPPORT” legislation to study the impact of allowing homeowners to transfer their property tax basis to a home anywhere in the state.  This relates to Propositions 60 and 90, and I incorrectly stated the provision that over-age-50 homeowners can transfer their tax basis once per lifetime.  Colleen reminded me that it’s over-age-55, not 50.  That’s how rumors get started, and I wanted to clear that up.  Thank you Colleen!

Housing Density

On the legislative front, the MAR Board of Directors voted unanimously at our last meeting to support our Assemblyman Marc Levine’s AB-1537, which seeks to lower the state-mandated housing density from 30-units per acre to 20-units per acre.  Local officials have come to meetings at MAR since I got there bemoaning this Sacramento-sourced mandate, where Marin is classified as “urban” and lumped in with San Francisco and Oakland, rather than “suburban” like our neighbors to the north in Sonoma and Napa counties.  This is unfolding, but MAR will doing what we can to support this legislation.

I wish you a safe and prosperous week!

Blaine

 

 

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