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A few weeks ago, the news media was all abuzz with opinion pieces stating that the $8,000 first-time homebuyer tax credit had run its course, and the prospect for extending the credit was very uncertain.
However, in the past couple of weeks, we have seen the tide shift, as several Members of Congress and the White House have said they are considering extending the credit into 2010. In fact, an article in today’s Washington Post, “White House Faces Pressure on Jobs,” makes several references to the credit and indicates that Congress is working behind the scenes to develop legislation that would include an extension.
Why the change?
Well, as it turns out, recent data on home sales and jobs show just how tenuous the economic recovery currently is. After four straight increases in home sale, the August numbers were down slightly. As time runs out on the current tax credit, those numbers could dip further. We need to keep the credit going until enough inventory is cleared to return us to more normal market conditions.
On Wednesday, NAR testified before the U.S. Small Business Subcommittee, and again emphasized that the tax credit is our best tool for sustaining the housing recovery. With more than 350,000 home sales attributed to the credit, it’s clear that it is one of the most successful economic stimulus provisions.
Of course, our testimony is just one way we are reaching out to Congress. Members, like you, are hitting home with the message, too. So far, more than 140,000 REALTORS® have sent letters to Congress on this issue through our most recent Call for Action. That’s a record for NAR, and it clearly has made a difference. If you haven’t responded, please visit the Action Center today and let your Representatives and Senators know how important the tax credit is to your clients.
With your help, I am hopeful that we will get an extension before the deadline – and perhaps have one more “win” to celebrate when we meet at the REALTORS® Conference & Expo this November. – Charles McMillan, 2009 NAR President
SECOVI invited me to deliver an industry address to an international real estate audience, and I talked to them about what is happening here in the U.S. market and economy. The audience hung on every word. They LOVE talking to a representative of NAR, and when we speak, they are looking for ideas that can help them address similar challenges and opportunities in their own markets.
In fact, my first meeting in Brazil was with another international group, FENACI, who wanted to know all about NAR’s history, structure and how we serve our members. You see, we are so highly respected and regarded that they want to learn from us.
This is not the first time I have experienced the “international effect” when traveling for NAR. When I went to Mexico last year to speak to our partners at AMPI, the high regard and respect were clear there, too.
But the highlight of the trip came during the Inaugural ceremony for the new President of SECOVI. When he stepped to the podium to deliver his remarks, he announced to the audience that he borrowed a number of themes from my recent address at the NAR Leadership Summit for his own Inaugural speech.
Now, that’s flattery!
I share this with you because I want you to know that, while things may not be perfect in the U.S. market, we continue to set a high bar for real estate practitioners around the world. We should all be proud of the work we do, and I thank all of you for electing me to represent you as your 2010 President. – Vicki Cox Golder, 2009 NAR President-Elect
In the classic movie, Mr. Smith goes to Washington, Jimmy Stewart’s character is appointed to fill a U.S. Senate seat and when faced with the reality of politics, he doesn’t back down.
Well, I may not be serving in Congress, but as your NAR President, my job is to represent you on critical issues. No matter how tough the challenge, you can count on me not to back down.
I just returned home to Texas after a full week in Washington, D.C., where I continued to press regulators on a few vital issues.
Last Wednesday, I met with FHA Commissioner Dave Stevens (a former REALTOR®) to discuss implementation of components of the Home Valuation Code of Conduct. We asked that FHA, Fannie Mae and Freddie Mac, adopt a consistent frequently asked questions document to address implementation concerns and codify that document with existing appraisal policy.
Commissioner Stevens agreed that requiring two appraisals in declining markets adds little benefit to underwriting and likely increases the cost of the transaction to the consumer. He also directed staff to work with the GSEs and New York Attorney General on our FAQ idea.
On Friday morning, I had a chance to meet with Freddie Mac’s new CEO Ed Haldeman, and HVCC was also on our agenda. Mr. Haldman agreed to work with FHA, Fannie Mae and the Federal Housing Finance Agency on a common set of FAQ’s. In fact, he promised that he would get back to me within two weeks with a status report.
The meeting with Freddie Mac was a great opportunity to talk about a few other hot issues.
Specifically, I thanked Freddie for coming out with guidelines that do not allow servicers to reduce commissions on short sales deals.
Mr. Haldeman also said that Freddie is willing to give waivers on their condo guidelines and he said they will be more vigilant in communicating with lenders on this issue.
We also learned that the Treasury Department and GSEs are working on guidelines related to short sales and the making Home Affordable program. We expect to see them in the next 30 days. Mr. Haldeman also agreed to emphasize the importance of short sales over foreclosures in discussions with the Treasury.
In Washington, D.C., progress can often be slow, but I am confident that the REALTOR® voice is the leading voice on policies that will define the future of our industry and our business. I urge you to get involved. Together, we can end 2009 on a high note, United Toward Tomorrow. – Charles McMillan, 2009 NAR President
A few weeks ago, I had the opportunity to address NAR’s 2010 state and local presidents-elect and association executives the Leadership Summit. It was a chance for me to explain our organization’s theme and goals for 2010 and to meet the other officers who would help me lead our members and industry in the year ahead.
By all accounts, the mood at the Summit matched the theme, “On the Rise.” Everybody was energetic and upbeat. I could feel the positive energy in the room. And, several people came up to me during the program and said they wanted to use the theme in their state and local associations.
Let me tell you, the response to the Broker Involvement Program was off the charts. I immediately heard from many associations who are motivated to add participation in this important program to their goals. In fact, I went up to Pinetop last week and handed out 50 forms myself. Since the Summit, we have had more than 80 new brokers sign up. And, that’s not all…
During the Game Changers panel, hosted by CEO Dale Stinton, we issued another challenge. We asked each state and local association to submit a truly unique and innovative idea that would change the way associations serve our members. The association that submits the best idea will work with the panel of experts to make it happen, and NAR will completely fund the endeavor. We have already received ideas from three associations.
Clearly, the audience at the Leadership Summit was hungry for good information from NAR, and I feel that we delivered it in a fun and educational way. We have posted all of the materials, along with some great videos of sessions, on the AE page at Realtor.org. I encourage all members to check it out.
Perhaps the most memorable speakers were our two special guests, Chris Gardner and Alison Levine, who reminded us all that success isn’t always in the end result – sometimes it really is the journey that makes the difference. Tough times are part of the deal, but if you keep pushing, you will rise to the challenge. I couldn’t have said it better myself. – Vicki Cox Golder, 2009 President-Elect
Last week, I had the opportunity to sit down for an interview with NAR’s 2010 Leadership Team. Although the team officially takes office in November, the Summer is an opportunity for them to get together and prepare for the coming year – and to get to know each other a little better – before they meet with association leaders in Chicago later this month.
Although I’m not part of the 2010 team, I’ve worked with every member of the team for several years, and I know them very well. I wanted to give you, our members, a sneak peak at what this new leadership team is like, and what you can expect to hear – and see – from them later this year.
The very first thing that struck me about the team is the incredible diversity in their experiences – and how that is going to help them make the best decisions for members.
As 2010 President Vicki Cox Golder noted: “Not a single one of us has the answer to all of the questions.”
As anyone who has served in leadership will tell you, having different opinions and perspectives ALWAYS leads to better decisions. So having a national leadership team where all areas of the business – land, title, commercial, etc. – are represented is a great service to the members.
For example, 2010 Vice President & Liaison to Committees Brooke Hunt believes that her experience as a sales agent, “being in the car, being in people’s homes, day in and day out” is a great complement to the team.
As CEO Dale Stinton said, “Everybody’s different; everybody has their own point of view. We trust and respect each other.”
I was also struck by how driven the incoming team is – and how passionate they are about serving the members. As 2010 Vice President & Liaison to Government Affairs Vince Malta put it: “We’re type A plus…and, that’s good for the members.”
Although the entire team spends about two-thirds of the year away from home on travel, they all agreed that meeting with members face-to-face is the most incredible experience.
So, what exactly is the team focusing on in 2010? In short – anything and everything that will help us in our businesses!
It should come as no surprise that laws and policies that can help the real estate market are high on the list of priorities. And, as Moe Veissi, 2010 First Vice President says we also need to keep creating new initiatives that help members in the business – like the Second Century Initiatives, and Right Tools, Right Now.
2010 Treasurer, Jim Helsel, also applauds NAR for doing more to communicate with commercial practitioners and for stepping up our visibility worldwide, with a new Senior Vice President for International. These are two areas where we can expect to see even more from NAR in the year ahead.
Perhaps our 2009 President, Charles McMillan, summed it up best, when he said, “This 2010 leadership is going to be responsible for the rise of our members, of the real estate consumer, and confidence in the economy of this nation.”
I couldn’t agree more, and I think you also are going to see a great push to get more new faces into leadership. As 2010 President-Elect Ron Phipps noted, “None of us would be here if we weren’t asked. Someone specifically came to us and said, I think you could do a good job. “
All in all, the spirit of the group is truly remarkable. How they work together is a credit to incoming President Vicki Cox Golder, who is one of the most prepared members I have ever worked with. She always welcomes input and ideas and is a true pleasure to work with. I couldn’t be more excited about this team and the future of our organization.
You’ll be able to watch my full interview with the 2010 Leadership Team, and get a closer look at the theme and goals for 2010, right here on the President’s Report a little later this month, so please check back at the end of August.
In the meantime, I encourage each and every member to get involved now. Call your local, state and national association and ask to be a part of the team that builds a brand new day for real estate in America. Now is our time to shine. – Dick Gaylord, 2009 Immediate Past President
Earlier this month, I blogged about my meetings with the New York Attorney General’s Office, the Federal Housing Finance Agency, and Fannie Mae to share our concerns about the Home Valuation Code of Conduct. I also mentioned the ongoing problems in my latest President’s Podcast.
It looks like our persistence on this issue is paying off. Fannie Mae and Freddie Mac recently issued new guidance to all lenders on the Home Valuation Code of Conduct. Specifically, they have advised lenders to use appraisers who have clear experience in the geographic area. They also made is clear that appraisers are not prohibited from talking to real estate agents.
We have e-mailed all members about this development, but I wanted to post it on the blog, as well, to make sure everyone is aware. Just go to Realtor.org/HVCC for the details.
This is a good first step, but we realize that we need to do much more to ensure that appraisals are being handled properly and don’t inhibit the market. NAR will continue to work on this issue in the weeks and months ahead and keep you updated on our progress.
I thank all of you for sharing your concerns and stories – especially those who responded on this blog. Keep the comments coming, and please share these updates with your colleagues. – Charles McMillan, 2009 NAR President
We have heard from many of you lately regarding the recent article in SmartMoney entitled, “10 Things Your Real Estate Broker Won’t Say.” We share your outrage over the clear distortion and misrepresention of the service real estate professional provide. Articles like this do a terrible disservice to homebuyers and sellers everywhere by providing false information.
Below is the letter I sent to the Personal Finance Editor at SmartMoney.com. Please share it with your colleagues. I have also included the Personal Finance Editor’s e-mail address if you wish to send your own comments.
July 14, 2009
Ms. Tedra Meyer
Smart Money Personal Finance Managing Editor
VIA E-MAIL: firstname.lastname@example.org
Dear Ms. Meyer,
The recent article (“10 Things Your Real Estate Broker Won’t Say,” SmartMoney, July 9, 2009) was full of inaccuracies, false assumptions and personal opinion, rather than any hard data that might actually be useful to home buyers and sellers.
The article does a great disservice to America’s real estate professionals, who are working harder than ever in this tough economy to help their clients buy and sell homes. Your article seems to imply that the unfortunate and unethical behaviors of a few real estate agents seem to be the industry rule, rather than the exception. Realtors® subscribe to NAR’s strict Code of Ethics; buyers and sellers who work with a Realtor® are assured of the protections the Code affords.
Real estate agents are not in the business of deceiving their clients in an industry dependent on the satisfaction of their customers for referrals and repeat business. In fact, buyers and sellers give high marks to Realtors® for the expertise and professionalism they bring to the real estate transaction. In a national survey of recent home buyers, nearly nine out of 10 were very satisfied with their agent’s honesty and integrity.
The article also inaccurately states that 20 to 25 percent of sellers market their homes on their own. In fact the number is much lower, around 13 percent – this number has been consistently trending down from a high of 20 percent in 1987. And nearly half of those were transactions in which the seller already knew the buyer – the home was not sold on the open market.
While some home sellers do choose to market and sell their homes on their own, unrepresented sellers have no access to fundamental marketing services, such as a Multiple Listing Service. The average person may only sell a handful of times during their lifetime, while Realtors® sell hundreds, if not thousands, of homes over the course of their careers. Unrepresented sellers face today’s challenging marketplace, complex transactions, with more disclosures and legal requirements than ever; time demands to market and show their property; and security concerns about strangers coming into their home.
In closing, please note for future stories that the term “Realtor®” is a protected trademark of the National Association of Realtors®, and is not synonymous with “real estate agent.” Realtors® are trained professional real estate practitioners, and only Realtors® are members of NAR and subscribe to the association’s strict code of ethics.
I just returned to Texas after a whirlwind trip to the east coast, where I met with the New York Attorney General’s office and officials from the Federal Housing Finance Agency and Fannie Mae. The topic: appraisals, and specifically the concerns and perspectives that you, our REALTORS and appraiser members have raised about the implementation of the HVCC.
First and foremost, I want to thank all of you for sharing your comments on the Voices of Real Estate blog this past week. Steve Brown’s entry, “All’s Not Quiet on the Midwestern Front” has received more than 120 comments – all of them very insightful. In fact, your thoughts were so important to the discussion that we shared them directly with the staff from the New York Attorney General’s office as prime examples of the problems we are seeing. We also shared the results of a recent survey of members, which highlights the overall impact of appraisal challenges on the mortgage transaction.
Those of you who have met me know that I don’t pull any punches. So, let me give you my honest assessment of my meetings:
1. All of the officials we met with wanted to hear about our experiences, and they conceded that there are problems.
2. All agreed that we can and should immediately address gaps in communication and education to help resolve how the HVCC is being applied.
3. How we resolve other more fundamental problems is not yet clear and will likely require a longer-term effort.
So what’s next?
First, in the weeks ahead NAR will be working closely with everyone in the industry, including Fannie Mae, Freddie Mac, the Appraisal Institute and government officials, to clarify the HVCC and how it should be applied. As many of you noted in your comments on this blog – pointing fingers is not the solution, we have to work together to improve the process for everyone.
Second, NAR is working with Congress to move legislation that would place an 18-month moratorium on the Home Valuation Code of Conduct, so that we can consider how best to modify the HVCC and to resolve additional concerns that many of you have raised about it and other appraisal issues in the current environment.
As always, we will keep you posted on our efforts on this blog and on Realtor.org. I encourage you to check out our HVCC Myths and Facts for more information. We also will be updating our FAQ to answer many of the questions you have raised in your e-mails and posts.
Of course, we encourage you to continue to share your thoughts and experiences with us whenever you can. With your participation, we will move the housing market forward, “United Toward Tomorrow.” – Charles McMillan, 2009 NAR President
Here in the trenches, on the front lines of real estate in Ohio, we continue to face challenges:
First, there is an oversupply of houses, and home values are still in a general decline.
Second, although the average sale price is up, we have unprecedented marketing times and nervous appraisers (or at best very conservative appraisers). With sales nearly 20 percent below the previous year, many appraisers working on behalf of banks are brought in from out of town appraisal companies. They are only familiar with the market through Internet information. As a result, we have appraisals coming in as much as $100,000 below contract sales price – effectively killing the sale.
Third, too often foreclosed homes have been left without any care by the banks that now own them and the condition is deteriorating. The impact on neighboring homes is devastating.
Fourth, mortgage approvals are taking longer than ever, not uncommonly going beyond contract dates. (So much for “time is of the essence”.)
Two recent Federal Acts: the Home Ownership And Equity Protection Act (HOEPA) and the Housing and Economic Recovery Act (HERA) are contributing to these problems. These regulations were intended to: a) provide greater financial education for consumers, thus aiding them in their financial lending choices; b) create safety checks in the lending process so consumers would not be victimized by predatory lending practices; and c) support more rigorous and transparent regulation of the real estate industry.
However, when Fannie Mae and Freddie Mac adopted the new Home Valuation Code of Conduct (HVCC) to assure appraisers would not be unduly influenced by lenders in the appraisal process, costs rose, while accuracy took a nosedive.
Although the goals are good and necessary, these laws were created and implemented without due consideration of how they would actually work for those of us who are in the “trenches.” As a result, the time delays and cost increases are hurting the very consumers they were meant to protect.
We have heard from many of you, and I assure you that we “get it”. NAR is lobbying federal legislators to correct and modify these laws. We also are pushing for a meeting with Federal Housing Finance Agency Director Lockhart to request a moratorium on the HVCC. Stay tuned for more news on this front next week.
Thankfully, the real estate industry and America’s real estate consumers have NAR to protect and defend us. In time, I hope our efforts will finally bring peace and quiet to the Midwestern front, and to the entire market. – Steve Brown, VP & Liaison to Committees