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MARIN REAL ESTATE BLOG

 

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

Apr 28

Housing Density – Larkspur SMART Station Area Plan, Updates on San Rafael City Resale Inspections and Sewer Laterals. MAR Monday Memo 04/28/14

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

Good morning MAR members!

Lots of new listings last week.  It seems that sellers are finally getting the message that people are looking to move!

One final reminder that the memorial service for MAR member and Novato icon Mike Di Giorgio is one week from today, Monday May 5th, from 11AM-1PM at Novato City Hall.  As I mentioned previously, Mike’s family has asked MAR member and Novato Councilwoman Denise Athas to share stories of Mike’s business life, and has asked for anecdotes and personal stories about Mike from our members.  For those of you who might have a good story to share, Denise has asked that you contact her via email at DAthas@aol.com.

This  week, the rest of MAR’s California Association of Realtors Board of Directors members and I will be in Sacramento for the CAR’s Legislative Day (Wednesday) and the Spring business meetings through Saturday.  If there is any pressing matter that you’d like CAR’s leadership to be aware of, please let me know and we will take it to Sacramento.  If you’d like to join us for Leg Day, Governor Jerry Brown will be addressing us on Wednesday morning.

San Rafael City Resale Inspections

I must say, it’s been very quiet this past week+.  Prior to our meetings with San Rafael’s City Manager and building department a couple of weeks ago, I was receiving daily calls…often multiple calls.  Now it’s like someone turned off the faucet…no calls.  In fact, one of our colleagues made it a point to tell me what a delightful inspection he had with San Rafael, when he was expecting the worst.  If you’re still having issues, I do want to know.

MAR CEO Andy Fegley and I will be meeting with San Rafael again next week…a meeting they asked for.  They have asked us to bring any suggestions for improving their process.  My message is going to be consistent with our last meeting:  please don’t penalize homeowners for things that San Rafael missed in the past.  It is San Rafael’s choice to require a resale inspection.  Since they do require it, we as the real estate community take the inspection very seriously.  As such, if the city misses something and people make the biggest financial decision of their life based upon that inspection, buyers and sellers have a reasonable expectation that the mandatory report is accurate.  If the report is inaccurate, San Rafael needs to offer a path to compliance if they missed something.

It’s as simple as that.  With all of that said, perhaps they’ve made some changes based upon our last meeting.  From where I’m sitting, the membership has been much quieter on this subject.

Housing Density– Larkspur SMART Station Area Plan

As I mentioned about a month ago, MAR has drafted and passed a housing density policy statement, which you can read right here <link>.  A few weeks ago, MAR’s Local Candidate Recommendation Committee met with both Supervisor Susan Adams and San Rafael Councilman Damon Connelly, who are running for Supervisor in District 1 (most of San Rafael from Central San Rafael north).  We also met with Supervisor Judy Arnold who is running for re-election in District 5 (Novato).  Supervisor Arnold’s opponent, MAR member Toni Shroyer, elected to not visit with MAR.

As you might imagine, much of the discussion focused on housing, housing density, and the vision for Marin going forward.  We asked all the candidates about their thoughts on the big density issue on the table right now, the development plan for the Larkspur Landing, ferry terminal and SMART train station.  Up to 900+ units.  The “Larkspur SMART Station Area Plan.”  The Environmental Impact Report (“EIR”) for this project is open for public comment until early June.  The decision on what to do rests on the shoulders of the Larkspur Town Council.  Here is the link to the plan, as well as instructions for offering your comments:  http://www.larkspurcityhall.org/index.aspx?nid=157

MAR took a position last summer in opposition to Plan Bay Area, because of the top-down planning approach it favored, rather than local control.   MAR is in favor of local control.

So here we are…local control time.  There was a spirited, standing room only community meeting this past Saturday at Bacich School in Kentfield, with supervisor Katie Rice in attendance.  The challenge that Supervisor Rice is facing…a challenge that every resident of Ross Valley is facing…is the same challenge that every resident of Marin who drives on 101 is facing:  namely, this proposed development is going to affect every one of us.  It’s going to be decided by the Honorable Larkspur Town Council, the elected leaders of Larkspur’s 12,000+ residents.  But it’s going to affect all of us, from a traffic, parking, water and sewage standpoint.

With that as the premise, we asked the Supervisor candidates their opinions about this plan.  All were quite wary based upon the past year’s public dialogue.  The only countywide agency with a stake in the decision is the Transportation Authority of Marin.  But ultimately it will be up to Larkspur.

The Environmental Impact Report public comment period goes until June 2nd.  MAR will be encouraging the Larkspur Town Council to consider the impact of this project on the county at large.  MAR encouraged the Supervisor candidates to take into consideration the county-wide impacts, and to offer input when appropriate.

And MAR encourages you, our members, to make your voices heard on the subject.  The public comment period is open.  Please comment on it.  This proposed project is going to affect all of us, so please weigh in with your thoughts.

More on Sewer Laterals

Briefly, in addition to the Mill Valley Area covered by the Sewerage Agency of Southern Marin (SASM), now it seems that Ross Valley Sanitary District (RVSD) is also now considering point-of-sale sewer lateral inspections.  At their meeting last week, it was brought up as an advisory matter.  MAR has shared the rationale of its opposition to point-of-sale inspections with both agencies.  After receiving MAR’s input, SASM postponed an advisory vote on the subject.  We shared the same feedback with RVSD last week.

This subject could quickly morph into something very, very large as it relates to the Marin real estate community’s ability to conduct business in arguably the county’s largest economic driver.

Stay tuned.  As I like to say, we are on it.

That’s all for now, next week I’ll have a report from CAR for you.

I wish you a safe and prosperous week.

Blaine

Apr 24

Just Listed! 190 Butterfield, San Anselmo, $719,000

By Marin Real Estate News
190 Butterfield San Anselmo

190 Butterfield San Anselmo

Your own private oasis awaits at this special property!  The sweet 2BR/1.5BA home offers so many possibilities!  Set way back behind outbuildings and across a bridge, you’re a world away at this well-maintained home.  Wood floors with a flat yard.  Great light and mature trees on a big lot, you will enjoy privacy and a wonderful lifestyle!  Outbuilding currently used as home office/studio with a storage room/wine cellar under…lots of room for gear, toys–perfect for people with stuff!  Sale includes approved plans for a 3BR/2BA single story expansion/remodel.  Close to trails, perfect for hikers, bikers and nature lovers.  Award-winning Ross Valley schools, you’re only a block away from Brookside school.  The perfect home base for your active Marin lifestyle, with a plan to grow as your needs change!

Apr 22

San Rafael Resale Inspections, Point of Sale Sewer Lateral Inspections and SASM, Upcoming CAR Meetings. MAR Monday Memo 04/21/14

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

Good morning MAR members! Happy Easter, Happy Earth Day!

With tax day blessedly behind us…so many buyers, so few houses, where is the inventory? Likely many listings in the coming weeks, but way more buyers than houses right now! The practice of auction-like pricing seems reasonable for our sellers, but it’s making so much work for so many whose buyers don’t really have a shot. Ten offers means nine sets buyers, nine agents and probably 7-8 mortgage brokers who all come away empty-handed. At least we’re all staying busy…

Last week’s big news–that the Sewerage Agency of Southern Marin is considering a model ordinance for the various agencies that fall under its advisory umbrella–generated a lot of discussion among our member community. MAR has been in touch with many relevant stakeholders, sharing our opinion that point-of-sale inspections are not the solution. Point of sale inspections will result in a 47-year resolution to an immediate problem, and the very real and substantial issue of shared laterals leaves many unanswered questions. SASM needs to come up with a real plan. The vote that was going to occur last Thursday did not occur, and SASM is seeking more of MAR’s input into the process. Stay tuned.

The other big continuing issue is the ongoing San Rafael resale inspection matter. Thank you to all of you who have contacted me with feedback. It’s edged every other matter aside as far as feedback is concerned. I literally get several calls a day. While every individual case is different, MAR is advocating on our collective behalf.

To that end, MAR CEO Andy Fegley and I met last Wednesday with San Rafael City Manager Linda Mackel, and two key members of her team: Paul Jensen, the Community Development Director, and Thomas Ahrens, head of the building department. I’ll describe it as a good meeting, but with a lot of loose ends that remain untied. But they did give us an hour, and listened intently to our feedback and they took a lot of notes and asked a lot of questions.

Again, thank you for all of your feedback as I had a ton of specific, timely, recent info to share. They were largely aware of every case we discussed. They also acknowledged that there has been a material uptick in the complaints with the enforcement process, though City Manager Nancy Mackel did not seem to be aware of the magnitude of homeowner and MAR member frustration.

My message remained simple: (1) It is because of San Rafael’s decision to have resale inspections that we find ourselves where we are; (2) there is no statewide regulation calling for resale inspections, and most municipalities don’t have the requirement; (3) because of San Rafael’s requirement for resale inspections, we all put a lot of weight in their content, and people inform what is often the largest financial decision they make based on the info in this report; (4) if San Rafael requires these inspections, and gets them wrong (in the past), and people make hundreds-of-thousands or million dollar decisions based on the contents, do not come back and penalize the new homeowner (and future seller) for mistakes or omissions that San Rafael made with its mandatory report in the past; (5) this new level of compliance enforcement for sometimes decades-old improvements are creating uncertainty, slowing escrows, and hindering commerce in the largest economic driver in the City of San Rafael.

The first Principle in MAR’s Fair Principles for Resale Inspections is “Consistency” and the second is “No Double Jeopardy”. We obviously have a current disconnect with these two principles right now. MAR is all for compliance, but if San Rafael is going to suddenly escalate the rigidness of its compliance requirement, it can’t suddenly change the way it does business and not expect substantial pushback.

San Rafael must create a smooth path to compliance, with allowances for situations, permit fees and penalties that exist today because of San Rafael’s mistakes and omissions in the past.

To his credit, Paul Jensen quickly followed up with us last Thursday to schedule a follow up meeting, and asked us for specific recommendations for improvements. I expect to be meeting with them again early next month.

Please keep sharing your stories. It’s hard to get resolution on every situation, or any one situation, but collectively they help me paint the clear picture of a broken process.

Finally, the California Association of REALTORS Spring Meetings and Legislative Day are next week. As I’ve said in the past, these are amazing meetings, particularly the Wednesday morning session when Governor Jerry Brown addresses the CAR Board of Directors, and later on Wednesday when the REALTOR Party makes its positions known and heard to our elected officials and their staffs. For more info on Leg Day, click here: http://www.car.org/governmentaffairs/getinvolved/legislativeday/. I hope to see many of you in Sacramento next week!

MAR’s members on the CAR Board of Directors include myself, President-Elect Matt Hughes, Katie Beacock (who is also Chair of CAR’s Region 4, of which MAR is part), Kay Moore and Mary Kay Yamamoto. If you have any concerns you’d like us to take to CAR on your behalf, please contact one of us. That’s it for now. I wish you a safe and prosperous week!

Blaine