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Agent Safety, SB-407 & Short Sale Auctions – Blaine Morris’ 2014 President of Marin Association of Realtors 02/24/14 Monday Memo

By Marin Association of Realtors, Marin Real Estate News

Good morning MAR members!

Auctions and Faucets and Prowlers, Oh My!

With ski week behind us, I anticipate a big week ahead.  From the looks of my email inbox, everyone is desperate and looking for properties to sell buyers.  I’m hopeful that this week is the week that sellers start to cooperate!

As for SB-407, well, we got it on the front page of the Marin IJ this week:

www.marinij.com/marinnews/ci_25173774/marin-homeowners-compelled-combine-water-conservation-renovation

So I’ll call my efforts to get the word out a success.  Notwithstanding the IJ’s error in calling it “SB-470”, the article was largely accurate.  Janis Mara of the IJ called me a few weeks back, after having a realtor tell her about the new law.  Janis was looking for answers, and I had to break it to her that so was I…

Anyway, the local building officials group DID have its monthly meeting last week, and my understanding was that pretty much the entire meeting was devoted to this subject.  They have formed a committee to address this, and the goal is to come back with a template either next month or the month after.  The spirit of the CALBO direction seems to be the direction our local officials are headed:  http://www.calbo.org/uploads/NoCal%20Policy%20Memo%20SB%20407%20%28Dec%202013%29.pdf

Net-net, most permitted repairs shouldn’t trigger a retrofit.

Interestingly, the building official I spoke with said that “typically, the legislature legislates intent, and leaves it up to the building officials to provide the details of the code.  This time, the legislature legislated a very vague code with all sorts of grey area, and the building officials are left picking up the pieces.”  I could not agree more.  For example, please define a low-flow bathtub faucet…

AUCTIONS

Moving on, everyone was commenting to me on the subject of auctions that I raised last week, but no one was offering specifics on how they were harmed or held liable as the result of an auction process…anyone?  CAR has asked for our help.  Most of the comments centered on the one aspect of this auction world that I can’t comment on, compensation.  MAR, CAR and NAR cannot get involved in that area, sorry.

AGENT SAFETY:  RECENT MARIN AGENT STORIES AND CRIME

Now, on to my Big Subject of the week:  agent safety.  I want to thank our friends at Alain Pinel for bringing some unsettling stories to my attention from this past week relating to brokers’ open and open house security.  Super-important stuff, and these real-world stories offer a useful safety refresher for all of us.

First of all, I was reminded about how we live in a different world…or that the world is getting smaller and some problems we’ve not typically worried about here in Marin are starting to come to our doorstep.  Home invasions, anyone?  I read this article in the IJ last month, and was reminded about it by a couple of agents this past week:   http://www.marinij.com/marinnews/ci_24987169/greenbrae-robbers-lock-resident-closet-ransack-home?source=pkg

In that one, robbers pushed their way into a Greenbrae home, last month, bound him and locked him in a closet and ransacked the home.

Earlier this month, the IJ discussed this growing trend of burglaries and robberies where our residents come face-to-face with these criminals:  http://www.marinij.com/crimebeat/ci_25087123/lately-marin-residents-and-burglars-find-themselves-meeting?source=pkg

I don’t know if we’re in the midst of a new trend here in Marin, but I’m certainly hearing about this sort of thing much more lately.

Which brings me back to agent safety.  Many of these stories seem to be coming out of Novato, where several years ago we had a very brazen prescription drug bandit.  This past week, one agent had prescription drugs stolen at the house during the Sunday open.  She has filed a police report, and the cops were ADAMENT that we need to report these things, it’s an increasing problem.

Another agent’s story was relayed from last week:  “one of our agents last week had just opened up an open house when a fairly large man entered the home.  Agent felt that he was a bit nervous.  The first thing he asked her was where the master bedroom was; she answered that it was upstairs.  He then asked her to please show it to him.  She said that she was busy opening up the home, etc, but he could go ahead up; he did so, and then called down to her to please come up and show it to her.  She just kept telling him that she was still setting up the home, etc.  When she asked him questions about what he was looking for and where he currently lived, he fumbled his answers and appeared to be making answers up on the spot.  It was a very uncomfortable situation; while he was there, agent made sure that she stood by the front door of the home in case she needed to get out quickly or get help.”

And another from last Wednesday’s broker’s tour in Novato:  “A man came in.  Not an agent. Claimed no one sent him there to see the condo.  He went upstairs.  She clearly heard him opening drawers.  She was alone so she didn’t say a word and stayed near the front door. He came down a bit later.  When she quizzed him again on what he was looking for and/or where he currently lived he was very aloof.  She got a strange feeling from him.  She informed the homeowner. ”

Are these all related?  Who knows, these sorts of stories come up every year.  PLEASE pass them along to your broker and to MAR.

Another safety item we should all take to heart and was shared this week by Carol Munson:  There is a local Marin emergency dispatch number,  415-472-0911.  Who knew?  You save critical and valuable time rather than being routed through some regional 911 call center.  Minutes count, please put this number in your cell phone!

I’m up front with sellers when I take a listing, and emphasize again when we are going on the market:   secure your valuables, particularly jewelry and things that can get up and walk away.  AND secure your prescription medication…particularly any sort of pain or anxiety medication.

Several years ago, in my extended family one of my family members developed a very bad problem with prescription medication that led to all sorts of bad things, bad behavior and ultimately very bad outcomes.  It’s everywhere.  I read last week that heroin overdoses have more than doubled in the last five years.  Doubled!  Heroin?  Really?  Why?  Because it’s easier and cheaper to get than increasingly regulated prescription meds.  So if you’re someone with a problem, perhaps it’s a little easier to go tour pretty homes on Wednesday, Thursday and Sunday to support your habit than it is to resort to pursuing the even harder stuff…

As a man, I don’t spend a lot of time worrying about my own safety beyond common sense and keeping an eye out.  But I’m also sensitive to the fact that our women colleagues view the issue of personal safety through a different lens.  I drove to a broker event last Thursday night in a big Suburban with seven of my women colleagues.  This issue was fresh in my mind, and I asked the women how many of them had felt uncomfortable in the past with someone in an open house.  All seven hands went up.  Then I asked how many had been fearful of her own safety to the point where she took active measures to secure her own safety.  Four of the seven hands went up.  “It’s a scary feeling and difficult to describe to a man” one of them said.

So let’s all be safe out there!  I’m not an expert on safety by any means, but don’t let unfamiliar visitors get between you and the front door or other safe exit.

NAR has a great agent safety website here:  http://www.realtor.org/topics/realtor-safety.  I’m also looking into an agent safety class at MAR.  Several years ago we had one of our members, who is a black belt, teach a well-attended safety class at MAR.  We’re going to look into something similar.  Another agent told me that they had the San Anselmo chief of police come in and give a safety and self-defense class at her gym that was well-attended.

MAR takes this matter very seriously.

I wish you all a safe and prosperous week ahead!

Blaine

 

 

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

 

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

 

 

SB407 and CAR Meeting Update – Blaine Morris’ 2014 President of Marin Association of Realtors 02/03/14 Monday Memo

By California Association of Realtors, Marin Association of Realtors, Regulations

Good morning MAR members!

Last week’s memo on SB-407, the new statewide water retrofit regulation, generated a huge amount of response.  Marin officials are still formulating their oversight plan, and MAR will get clarity on the changes. We will be doing so ASAP to determine the local criteria to trigger a need to retrofit based upon permit issuance.

Again, it is not a current point-of-sale requirement.  It is triggered by the pulling of permits for other things, starting this month.  However, starting January 1, 2017 (three years from now) every homeowner in the state will be required to retrofit their homes built before 1/1/1994, regardless of point-of-sale or permits… even if it’s not part of a sale.  Thus, it will become a point of sale requirement on January 1, 2017 for homes built before 1/1/1994.  Much like the recent rollout of required carbon monoxide detectors in all homes.

Some of you asked about disclosure requirements.  The Real Estate Transfer Disclosure Statement was revised over a year ago to reflect this new law.  On page 2 of the RETDS, the document specifically discloses much of this, but is brief in the description.  There looks to be an upcoming “Water Conserving Fixtures Disclosure (SB407)”, and I’m seeking clarity on when this form will be available.

MAR will continue to pass along info.

I promised to report back on the developments at last week’s CAR meetings in San Diego.  The other members of our CAR team will be reporting to back to me, and I will forward other relevant items as I learn about them.

So, in no particular order:

Transaction and Regulatory

I sit on this committee.  We voted on the following action items, and we later voted as the CAR Board to approve these action items. These are NOT new regulations; CAR is simply starting the process:

  • That CAR “SPONSOR” legislation to clarify the rules for the CalBRE to regulate the use of “Team” names by licensees.  This was an extremely busy conversation, as this subject is getting a lot of attention at the CalBRE.  Currently, brokers are supposed to file a DBA to cover team names working for their brokerages…and the broker officially owns those team name DBAs.  This policy needs clarification, and an update is planned for the May meetings.
  • That CAR “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.  This was THE big issue that everyone was talking about the whole week.  There is too much on this subject for this memo, I’ll be writing more on this soon.  Also, at the CAR Board of Directors meeting, the floor voted to direct CAR legal staff to look into the whole validity of our listing agreement, as some banks are now requiring short sale transactions to go out to auction after a purchase agreement is executed…effectively ordering the listing broker to abrogate a valid contract and turn the listing over to the auction company.  Everyone is very interested in this subject, stay tuned.
  •  That CAR “SPONSOR” legislation to prohibit short-lived communications like tweets or text messages from being considered “transactional documents” that must be retained in a broker’s file.  This will be an ongoing conversation, but for now your text messages are supposed to be retained.

Taxation and Government Finance Committee

We voted to “SUPPORT” legislation to study the revenue impact of allowing homeowners to transfer their property tax basis to a home anywhere in the state.  This relates to Propositions 60 and 90, where over-age-50 homeowners can transfer their tax basis once per lifetime.  Right now, this is governed on a county-by-county basis, and Marin does not allow a new homeowner from outside the county to transfer his or her tax basis into Marin (though an intra-Marin transfer is allowed).  I tried to discern the political will for this, and the answer was “stay tuned.”

Public Policy Forum–General Home Inspectors

This forum was packed.  Believe it or not, there is no current statewide licensing requirement for general home inspectors.  We use these valued professionals in many of our transactions, and there are current industry standards in their trade associations.  But no statewide oversight.  Pest inspectors, engineers, electricians and plumbers all have a licensing requirement, and there is a discussion of creating such a licensing requirement for general home inspectors.  We voted on the Transaction and Regulatory Committee to establish a working group to explore this subject, and also to “explore options related to home inspectors contractual limitation of liability provisions…”   More on this later in the year.

Standard Forms Advisory Committee

The other big news from CAR is that there is a substantial revision of the Residential Purchase Agreement in the works.  The current draft will be available here http://on.car.org/rpa2014 until 2/14/2014, and there will be more revisions going forward.  Take a look, and we’d love to be able to pass along any feedback.

I wish you a safe and prosperous week ahead!

Blaine