NOVEMBER 2013
VOLUME XLVII Number 6
The Maryland Association of REaltors速
www.mdrealtor.org
The Voice for Real Estate速 in Maryland
12 Revised Forms for 2013
Consumer Website: www.marylandhomeownership.com
6
2013 Annual Conference & Awards
17
MAR Memeber Benefits
22
2013 Life Achievement Award
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President’s Perspective
R u s s B o y ce
One Degree From Good to GREAT
It is an honor to lead our professional Association into 2014, which promises to be a year of change and challenge. I intend to focus on helping members raise their awareness which in turn will make their businesses prosper. “One degree from good to GREAT” is a philosophy for how we can make our professional lives more successful. Going that extra step when dealing with clients or anyone else in the course of business makes us that much more valuable to clients and to fellow REALTORS®.
A
key part of making our profession and our industry successful lies in our political voice. Next year will be a critical one, as national, state and local elections will bring into office officials who will have a great deal to say about our business, and the rights of the property owners we serve. We at MAR are planning to expand our involvement at all levels, to make sure that our industry, our profession and the public are well served by legislative and regulatory actions in the years ahead. We will need your help. It has never been more important to make sure our REALTOR® voice is heard. Watch for emails from your broker, from MAR and from NAR, asking you to respond to “CALLS FOR ACTION.” Our response rate in Maryland exceeds the average NAR response rate. But this is nowhere near enough to persuade elected officials that issues such as Mortgage Interest Deduction (MID) and the secondary mortgage
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market are critically import. Help us make the case. I ask each of you to continue the efforts of our past leadership to get all Maryland REALTORS® to respond. When you see the “CALL TO ACTION” on the MAR Facebook page, please “share” it with as many people as possible. If you get an email or text, please forward it to at least 3 people in your office. Additionally, I encourage you to invest in yourself professionally. Last year, under Carlton Boujai, we began an effort to “Raise the Bar” and improve our performance. MAR & your local Association/Board offer education courses that will help us do that. Visit the Education calendar at mdrealtor.org to learn more. Consider now the time to pursue that Designation you have been considering. Raise your awareness and make this year your best year in real estate.
Annual Conference/Industry Awards Please take a moment to read the profile on Pat Kane, our 2013 Life Achievement awardee. Pat has been a champion of our industry for over 30 years. Congratulations to all our industry award individual and local association/board recipients. Take a look at the photo spread beginning on page 6 to see our Conference highlights. And don’t forget to save the dates for the 2014 Annual Conference and EXPO, September 8–10. MAR Member Benefits MAR exists to serve you, our members. This month, we are highlighting many of the benefits of your membership. Check out our benefits on page 17, which include an array of affinity partners from national companies. I am always available to answer your questions or hear your concerns. Please contact me at info@mdrealtor.org.
MARYLAND REALTOR® NOVEMBER 2013
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TA B L E O F CO N T E N TS Features
2013 Annual CONFERENCE & AWARDS
6
2013 realtor of the year NOMINEES
9
2013 ANNUAL CONFERENCE AND EXPO SPONSORS
Revised Forms for 2013 Summary of Changes and Practice Tips
MAR MEMBER Benefits WITH DIRECT SAVINGS!
MAR MEMBER Benefits WITH DIRECT SAVINGS!
2013 Annual CONFERENCE & AWARDS
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6
12
Revised Forms for 2013
MARYLAND REALTOR® NOVEMBER 2013
17 22
10 12
17
2013 Life Achievement Award Patrick J. Kane 22
Departments
President’s Perspective
1
Regulation News
24
Maryland Real Estate Commission News
26
Commercial Connection
28
Residential Sales
30
SNIPPETS
34
From the Hotline
36
2013 Life Achievement Award
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MARYLAND HOME MAKEOVER ™ MARYLAND HOME MAKEOVER™ projects in
Essex and Pasadena in 2013–2014 are made possible through the support, commitment and generosity of REALTORS®, contractors, suppliers, friends and community groups targeting the accessibility needs for these families.
EQUAL HOUSING
OPPORTUNITY
There is still time to make a tax-deductible donation for 2013.”
PASADENA Grace Pointe Community Church of the Nazarene Anne Arundel County Association of REALTORS® Anne Arundel County Chapter Women’s Council of REALTORS® Maryland Association of REALTORS® Maryland Chapter Women’s Council of REALTORS® C R Goodman Associates Harkins Builders, Inc. Dirt Express BBT Lighthouse Project Messick and Associates Adelman, Sheff & Smith Robert W. Johnson Associates, Inc. Diversified Permits Anne Arundel Tree “Un-limb-ited” Tree Service Pillar to Post Storm Utilities, Inc. Masser Contractors Bray & Sharff Maryland Deckworks, Inc. All American Plumbing, Inc. M.N. Mack, Inc. Bay Area Mechanical Services, Inc. Stock Building Supply and Metal Industries Reico Distributors Reliable Contracting Company Bay Area Disposal Smith and Son’s Contracting
Sage Title Appraisal Concepts J.F. Johnson Lumber Co. Bug Out Artistic Freedom & Painting Anderson Minuteman Press UPS Store at Lake Shore ACE Hardware – Lake Shore Sign-A-Rama of Glen Burnie Rock Top Fabrications Brucksch & Sons Contracting Bernie Lindemann Steve Clarke Amy Menrad Mark Morgan and the Partners and staff of Two Rivers Steak & Fish House All Out Bail Bonds All Stretched Out Limousine Service All Counties Fire and Water Mitigation, Inc. Edible Arrangements of Glen Burnie Brewer’s Services Rick Daugherty, Oxspeed Mary Dixon, G’Day Pet Service Jing Ying Institute Jamie Irvine Outback Steakhouse Wendy Spry Kimberly Toolan John’s Auto Body Maggie Weaver Laura’s Eyes Photography Severna Park Community Center
Cooch & Bowers PA Davco Restaurants, Inc. The Sikes Family TLC Home Organizing & Staging Services Bay Area Restoration Fund The Columbia Bank Laurie Murray Alease Bowles Tom Levin Janice Kirkner John and Patricia Mitchell Sidney and Sandra Hochstein The Earl Family Susan Bents OWLS Sunday School Class, Elvaton Baptist Church Chris Fitch Robert and Nancy Sikes Martha Labeau Deborah and James Frantz Cherie and Donald Lemin Schmidt Family Enterprises Debbie Ryan Marcia Feliciano Rick and Robbie Dunning Aegis Title Associates Lynne and John Hugendubler Deborah and Ronald Swank Karen and Lawrence Kushner James and Debra Vanghel JoAnne Poole Chili’s Zimmerman Seamless Gutters, Inc.
ESSEX Greater Baltimore Board of REALTORS® GBBR Charitable Foundation “Raise the Roof” project Greater Baltimore Chapter Women’s Council of REALTORS® Maryland Association of REALTORS® Maryland Chapter Women’s Council of REALTORS® Metropolitan Regional Information Systems, Inc. (MRIS) CFG Community Bank TDE Home Services Smart Box Venable LLP ACF Environmental Blazeguard Comer & Son Harkins Builders, Inc. Shelter Systems Capital Concrete Foundations, Inc. Southard Brothers Stock Building Supply and Metal Industries Landers Appliance NTT Associates Sage Title Kipper Appraisals Joe the Architect, Inc. RE/MAX American Dream Friends of Senator Stone Chili’s 84 Lumber – Curtis Bay J & W Framing Contractors Pat the Plumber
Thank You
2014 Maryland Association of REALTORS® Leadership Team Maryland Association of REALTORS® 200 Harry S Truman Parkway | Suite 200 Annapolis, MD 21401-7348 800.638.6425 | www.mdrealtor.org
Executive Leadership Team
J Russell “Russ” Boyce
Janice R Kirkner
President RE/MAX 100 10665 Stanhaven Place White Plains MD 20695-3062 301.843.5100 russboyce@remax.net
President Elect Long & Foster Real Estate, Inc. 1208 Nottingham Drive Westminister, MD 21157-8334 410.795.9600 janice.kirkner@longandfoster.com
J Russell “Russ” Boyce | President Janice R Kirkner | President Elect Carole A Maclure | Treasurer Bonnie Casper | Secretary Carlton J Boujai Jr | Immediate Past President Mary C Antoun | Chief Executive Officer
Editor
Melissa Lutz | melissa.lutz@mdrealtor.org
Advisory Committee Jenn Klarman | Chair
Advertising
Arlene Braithwaite | 410.772.0820
Publication Design
HBP, Inc., 952 Frederick Street, Hagerstown, MD 21741 800.638.3508 | www.hbp.com
Carole A Maclure
Bonnie Casper
Treasurer RE/MAX Advantage Realty 17304 Evangeline Lane Olney, MD 20832-2928 240.295.6000 maclure7@aol.com
Secretary Long & Foster Real Estate, Inc. 4650 East-West Highway Bethesda, MD 20814-3419 301.907.7600 bonnie@lnf.com
Carlton J Boujai Jr
Mary C Antoun
Immediate Past President EXIT Realty Prosperity Group 5300 Westview Drive Suite 105 Frederick, MD 21703-8339 301.698.8700 carltonboujai@mris.com
Chief Executive Officer Maryland Association of REALTORS® 200 Harry S Truman Parkway Suite 200 Annapolis, MD 21401-7348 800.638.6425 mary.antoun@mdrealtor.org
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MARYLAND REALTOR® NOVEMBER 2013
Mission Statement The Maryland Association of REALTORS® exists to support all segments of its membership and their specialties. The Maryland Association of REALTORS®, through collective efforts with local boards/associations and the National Association of REALTORS®: ■ Develops and delivers programs, services and related products that maintain and elevate the high standards of the real estate business and the professional conduct of its practitioners; ■ Assists members in ethically and professionally serving the public; ■ Promotes and preserves the right to own, transfer and use real property; and ■ Protects the right of members to conduct business within a framework of fair and reasonable laws and government regulations. In principle and in practice, the Maryland Association of REALTORS® values and seeks diversity and inclusive participation within the field of real estate and recognizes each member as a unique individual. Maryland REALTOR® (USPS 0016-017) is published bimonthly by the Maryland Association of REALTORS®, Suite 200, 200 Harry S Truman Parkway, Annapolis, MD 21401-7348. Periodical postage paid at Annapolis and additional mailing offices. Postmaster send address changes to: Maryland REALTOR®, Suite 200, 200 Harry S Truman Parkway, Annapolis, MD 21401-7348. Member subscriptions of $3.81 are paid with annual dues. This publication is designed to provide accurate and authoritative information regarding the subject matter covered. It is offered with the understanding that the publisher is not engaged in rendering professional advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Articles that appear in Maryland REALTOR® are an informational service to members. Their contents are the opinions of the authors alone and do not necessarily represent those of the Maryland Association of REALTORS®. Permission to reprint articles appearing in Maryland REALTOR® magazine must be requested in writing. Also include purpose for request. While this magazine makes a reasonable effort to establish the integrity of its advertisers, it does not endorse advertised products or services unless specifically stated. ©2013 Maryland Association of REALTORS®, Inc.
www.mdrealtor.org
l a u n n A 2013
E C N E R E CO N F
S D R AWA
&
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MARYLAND REALTOR® NOVEMBER 2013
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Maryland Association of REALTORS
Annual Conference AND Expo
Over 1,100 MAR members and attendees gathered in Ocean City in mid-September for the Annual Conference and EXPO. The Annual Conference featured extensive, cutting-edge continuing education, numerous networking opportunities and a full array of products and services expressly geared for the members in a packed EXPO Hall.
Life Achievement Award Pat Kane received the MAR Life Achievement Award from 2012 awardees JoAnne Poole & Iona Harrison.
Omega Tau Rho
2012 President Pat Terrill received the medal from 2013 NAR Treasurer Bill Armstrong.
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MARYLAND REALTORŽ  NOVEMBER 2013
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Community Action and REALTOR Excellence (CARE) Awards This award recognizes outstanding achievements in Community Service by Local Association Members. The nine local nominees are: Greater Baltimore Board, Bay Area, Greater Capital Area, Cecil County, Frederick County, Garrett County, Mid-Shore Board, Prince George’s County and Southern Maryland. Garrett County Board of REALTOR members accept the Special Projects Award for their work to provide hats & gloves to 216 children in their community. The Board will receive $1,000 to be given to a charity of their choice.
Southern Maryland Association president, Kevin Turner (middle) members accept the 1st Honorable Mention from CARE Committee Chair, Linda Simpson (right) and 2013 MAR President, Carlton Boujai (left). The $5000 award will be donated to the charities of their choosing.
Linda McKinnon was presented with the 2013 Community Service award by 2012 recipient, Simon Nwaigwe.
Shining Star Award Carla Kemp accepts the MAR Shining Star Award. The award was presented to Carla for her work as a new volunteer with the Annual Conference Committee.
Cecil County Board members Linda McKinnon and Nancy Simpers (middle left & middler right) accepted top honors from CARE Committee Chair Linda Simpson and 2013 MAR President, Carlton Boujai. Their $10,000 prize will be given to up to five charities of their choosing.
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Community Service Award
MARYLAND REALTOR® NOVEMBER 2013
President’s Award President Carlton Boujai presents the President’s Award to Linda Simpson for her outstanding efforts and leadership this year. www.mdrealtor.org
2013 realtor of the year N O M I N E E S Tom Levin Anne Arundel County Association
Sharon McKenna Greater Baltimore Board
Mary Jane Stevens Bay Area Association
Bonnie Casper Greater Capital Area Association
Janice Kirkner Carroll County Association
Paula Gilley Cecil County Board
Pamela Wadler Coastal Association
Gloria Castle Frederick County Association
Michael Kennedy Garrett County Board
Marianne Ferguson Harford County Association
Barbara Linthicum Historic Highlands Association
Teri Deane Howard County Association
Susie Hayward Mid-Shore Board
Anthony Williams Prince George’s County Association
Kevin Turner Southern MD Association
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MARYLAND REALTOR® NOVEMBER 2013
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L A NNU A 3 1 20 D N A E C N E R E F N O C S R O S N O P S EXPO Main Conference Sponsors MRIS Pentagon Federal Credit Union
Platinum Sponsor Century 21 Real Estate
2013 MAR President, Carlton Boujai recognizes the Annual Conference & EXPO Main Sponsors with framed logos. (L) Kevin Wiles, President, Prudential PenFed Realty accepts on behalf of Pentagon Federal Credit Union, and (R) David Charron, President & CEO, MRIS.
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MARYLAND REALTOR® NOVEMBER 2013
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Overall Conference Sponsors Carroll County Association of REALTORS® Cecil County Board of REALTORS® EXIT Realty Mid-Atlantic Garrett County Board of REALTORS® Greater Capital Area Association of REALTORS® Harford County Board of REALTORS® Maryland Hispanic Real Estate Industry Association (MHREIA) Mid-Shore Board of REALTORS® Women’s Council of REALTORS®
REALTOR Business Center Coldwell Banker Residential Brokerage
NAR Directors Breakfast Anne Arundel County Association of REALTORS® Howard County Association of REALTORS®
Continental Breakfasts Coastal Association of REALTORS®
Wednesday Refreshment Break Prince George’s County Association of REALTORS
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Installation Banquet
Golf Tournament
Platinum Sponsors
Hole in One Sponsor Sharon McKennain Memory of Christopher McKenna
RE/MAX 100 Lakeside Title SunTrust Bank
Cocktail Reception & Wine Tasting Sponsor Long & Foster Real Estate
Gold Sponsor Southern Maryland Association of REALTORS®
Décor Sponsor RE/MAX Central Atlantic
Former President Banquet Sponsors
Golf Tee Sponsor Carla Kemp, Resource Title Martha Lessner, REALTOR® The Mortgage Link Prudential PenFed Realty Beverage Cart Frederick County Association of REALTORS® Longest Drive Prize Packages The Original Greene Turtle, Ocean City, MD
Bill Armstrong, 2000 MAR President Bill Neary, 2002 MAR President Billie Landbeck, 1978 MAR President Carlton Boujai, 2013 MAR President Carole Maclure, 2013 MAR Treasurer, 2008 MAR President Cathy Werner, 2011 MAR President Ilene Kessler, 2007 MAR President JoAnne Poole, 2005 MAR President John Harrison, 1997 MAR President Pat Terrill, 2012 MAR President Steve Meszaros, 2010 MAR President MARYLAND REALTOR® NOVEMBER 2013
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Revised Forms for
2013
Summary of Changes and Practice Tips
Contract Changes Residential Contract of Sale ■ Paragraph 5—Regarding ground rents, the phrase “or to be created” was removed. ■ Paragraph 16B—The link providing additional information about the Lead Renovation, Repair and Painting Rule was updated. ■ Paragraph 17—The Seller Contribution Addendum was added to the list of addenda. ■ Paragraph 21—The new title of the Property Inspections and Condition Notice was inserted. ■ Paragraph 27—This provision was modified to alert sellers that permit violation notices must be complied with by settlement. ■ Paragraph 50—This provision was revised to alert buyers to inquire about deferred water and sewer assessments imposed by private entities and about whether any improvements to the property required permits and whether any permits issued
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MARYLAND REALTOR® NOVEMBER 2013
were complied with. It also alerts buyers to contact the appropriate local government agency and/or a licensed engineer to verify permit issuance/status. Practice Tip: We advise buyer agents to encourage buyers to inquire about deferred water and sewer assessments imposed by private entities, and whether the proper permits were obtained and complied with for any improvements prior to submitting an offer. Unimproved Land Contract of Sale ■ Paragraph 17—The Seller Contribution Addendum was added to the list of addenda. ■ Paragraph 50—This provision was revised to alert buyers to inquire about deferred water and sewer assessments imposed by private entities. Practice Tip: We advise buyer agents to encourage buyers to inquire about deferred water and sewer assessments imposed by private entities prior to submitting an offer.
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■ Paragraph 5—This provision was modified to enable both buyer and seller to terminate the contract if third party approval is not obtained within the agreed upon time frame or if the parties cannot agree to proposed modifications to the contract requested by a third party. Practice Tip: Licensees should advise clients of the potential for third parties to condition acceptance of the contract on the seller’s agreement to additional terms not specified in the contract. Practice Tip: If either party elects to terminate the contract in accordance with the terms of the Addendum, buyer/seller may use the Unilateral Notice of Termination. If there is agreement regarding termination of the contract, the parties may use the Mutual Release of Obligation under Contract form. Disclosure of Licensee Status Addendum ■ This form was completely revised to comply with revised Regulation 09.11.02.02. Practice Tip: This Regulation was amended to require licensees to disclose their licensing status when selling property they own or have an interest in, or when acting on behalf of certain individuals who are selling property. Similarly, licensees must disclose their status when purchasing property for themselves or when acting on behalf of certain individuals who are purchasing property. You may review the revised Regulation at: http://www.dsd.state.md.us/comar/getfile. aspx?file=09.11.02.02.htm%20
MAR Contract Addenda Changes All MAR Contract Addenda ■ The headings of ALL of the MAR Contract Addenda have been modified and no longer require insertion of the Contract of Sale date (the word “dated” and the blank line appearing next to it have been deleted). Practice Tip: Do not forget to insert the date of the Addendum, which in many instances is the same as the Date of Offer. Short Sale Addendum to the MAR Contract ■ First line—The first line was inserted to make clear that the terms of the Short Sale Addendum supersede any conflicting language elsewhere in the contract. ■ Paragraph 1—Language was inserted to clarify that a seller’s failure to keep existing mortgages free of default until settlement is not a default of the contract. ■ Paragraph 4—Language was inserted to alert buyer and seller that third parties may request that seller agree to terms not specified in the contract and that this decision lies exclusively with the seller. www.mdrealtor.org
FHA Financing Addendum ■ Paragraph 1—The words “current market” were removed. The phrase “as charged by lender” was inserted. ■ The sentence below the signature lines on page 2 of the Addendum was inserted. Practice Tip: The sentence referenced above was inserted to alert licensees involved in the transaction that FHA rules require that they certify that to the best of their knowledge and belief, the terms of the contract are true. Notice Pursuant to Condition of Property and Possession Paragraph of MAR Residential Contract of Sale and Notice Pursuant to MAR Inspections Addendum ■ The title of this Notice was changed to Property Inspections and Condition Notice Practice Tip: The revised title should make it easier for licensees to identify the form. Onsite Sewage Disposal Inspection Addendum ■ Paragraph 3—For consistency, the phrase “not later than ____ days prior to settlement” was removed and “within ________ (____) days from the Date of Contract Acceptance” was inserted in its place.
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VA Financing Addendum ■ Paragraph 1—The words “current market” were removed. The phrase “as charged by lender” was added. ■ Paragraph 4—The citation number was updated. Water Quality Addendum ■ Paragraph 1—This provision was modified to alert the parties that the various tests may be required by certain lenders. ■ Paragraph 3—For consistency, the phrase “prior to settlement” was removed and “from the Date of Contract Acceptance” was inserted in its place.
MAR Brokerage Agreements Changes Exclusive Right to Sell Residential Brokerage Agreement ■ For consistency, the word “Seller” was inserted in place of “Owner” throughout the document. ■ For consistency, the word “Property” was capitalized throughout the document. ■ Paragraph 16B—The link which provides additional information regarding the Lead Renovation, Repair and Painting Rule was updated. ■ Paragraph 19—This provision was inserted to alert the seller that the contract may require that she/he cure any outstanding violations. ■ Paragraph 26—Line 8 discussing execution and delivery of the deed was removed. Exclusive Buyer/Tenant Representation Agreement ■ Paragraph 4—The phrase “has occurred” was removed. ■ Paragraph 12—Line 8 discussing execution and delivery of the deed was removed. Exclusive Right to Sell Unimproved Land Listing Agreement ■ Paragraph 4—The phrase “Broker to insert the terms of termination” was added. ■ For consistency, the word “Property” was capitalized throughout the document. Exclusive Right to Lease Residential Brokerage Agreement ■ Paragraph 4—The phrase “Broker to insert the terms of termination” was added. ■ For consistency, the word “Property” was capitalized throughout the document.
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MAR Brokerage Addenda Changes All MAR Brokerage Addenda ■ The headings of ALL of the MAR Brokerage Addenda have been modified and no longer require insertion of the Brokerage Agreement date (the word “dated” and the blank line appearing next to it have been deleted). Short Sale Addendum to the MAR Exclusive Right to Sell Residential Brokerage Agreement ■ Paragraphs 6, 8, 10 and 13—These provisions were incorporated into the Addendum pursuant to guidance issued by the Maryland Real Estate Commission concerning the applicability of the Maryland MARS Act (the “MD MARS Act”) as it relates to short-sales and real estate licensees. The guidance may be reviewed at: http://www.dllr.state.md.us/ license/mrec/mrecshortsalesguide.shtml Practice Tip: The guidance issued by the Maryland Real Estate Commission discusses permitted activities, licensee requirements and activities subject to the MD MARS Act. Regarding activities permitted, licensees may enter into a contract with a homeowner to market their house for a short sale, list the property in multiple list service, and market the property for sale. With regard to licensee requirements, licensees must refer a seller to a tax advisor or tax professional to explain to the seller the potential tax consequences of a short sale. They are also required to refer a client to a housing counselor for discussion about alternatives available to avoid foreclosure and inform the seller of, and refer to the licensee’s broker, any requests from the lender/servicer for reductions in real estate brokerage commissions on a short sale. Finally, engaging in activities such as collecting money in addition to the real estate brokerage sales commission from a short sale client requires compliance with the MD MARS Act. Please review the information posted on the above link for additional clarification. Lock Box Addendum ■ Title Change—The title of the Addendum was modified to notify users that it may be used in sale and lease transactions. ■ For consistency, the word “Seller” was inserted in place of “Owner” throughout the document. Financial Condition Addendum ■ For consistency, the word “Seller” was inserted in place of “Owner” throughout the document.
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Dwelling Lease Template ■ Box at the top of page 1—Lines 4 through 7 were inserted. Practice Tip: This language alerts users that the Template should not be used in Prince George’ s County. A licensee involved in a lease transaction in Prince George’s County should contact the Prince George’s County Association of REALTORS® to obtain the current document. ■ Paragraph 8—Lines 6 through 8 were inserted to clarify how late rental payments will be applied. ■ Paragraph 16—This paragraph was modified to comply with the revised smoke alarm law. Practice Tip: The new law, effective July 1, 2013, requires home sellers completing the Residential Seller Disclosure and Disclaimer Form to answer additional questions regarding smoke alarms in the Form’s Disclosure section. All battery operated alarms must be sealed, long-life batteries by 2018. The new law also applies to single family rentals (two units or fewer). Alarms must be upgraded if any of the following conditions exist: (1) existing alarms are older than 10 years; (2) existing alarms fail to operate properly; or (3) a change of tenancy occurs, and battery operated units have not already been upgraded to sealed, long-life batteries. Additional information regarding the smoke alarm
law may be obtained at the following link (select “LINK TO ARTICLE”). http://www.mdrealtor.org/Legislative/ GovernmentAffairsNews.aspx ■ Paragraph 17—This notice was inserted to clarify that some jurisdictions have a requirement that the tenant be provided information concerning the testing and maintenance of carbon monoxide detectors. Practice Tip: In those jurisdictions where the aforementioned requirement exists, the tenant should initial the Tenant Certification. ■ Paragraph 19—For consistency, the items listed were alphabetized. ■ Paragraph 22—For consistency, the items listed were alphabetized. ■ Paragraph 33E—The link providing additional information regarding the Lead Repair, Renovation and Painting Rule was updated. ■ Paragraph 35—A sex offender provision was inserted. Practice Tip: Licensees working with tenants should advise the tenant to investigate this issue prior to signing the lease. ■ Paragraph 51—The first four lines of the paragraph were inserted to clarify the term “broker” as used in the lease.
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MARYLAND REALTOR® NOVEMBER 2013
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MAR MEMEBER WITH D IREC T SAV IN G S ! MAR Legal Hotline–1-800-888-1272
Get a Quote Now
Free, authoritative legal advice is available by calling the MAR Legal Hotline or by submitting a WebQuestion Form. Questions on all aspects of real estate law are answered. A written response is sent to all callers and their brokers.
Receive a Maryland Real Estate E&O Insurance Quote and choose to bind coverage or renew your policy. As a Pearl Insurance insured, you’ll gain access to our quality Real Estate Errors & Omissions Insurance as well as: ■ Extensive risk management tools and services
Errors & Ommissions Insurance and More— As a leader in the insurance industry for nearly 60 years and a long time partner of the Maryland Association of REALTORS®, Pearl Insurance is proud to share with you our quality Errors & Omissions Insurance, which offers valuable coverage that’s better and more affordable than ever before. Find out how Maryland REALTORS® E&O Insurance by MAR Sponsored Pearl Insurance can benefit you.
Get a Premium Estimate Not ready for a quote? No problem. Simply take a couple of minutes to complete our premium estimate form for Maryland Real Estate E&O Insurance Estimate. Our sales representatives will use this information to get a quote for you, and will contact you within 24 hours.
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TransUnion SmartMove TransUnion SmartMove gives MAR’s independent landlords all the screening tools they need, with none of the hassle. Visit http://mar.mysmartmove.com to get started and create an account in minutes. Receive credit & criminal reports, and a leasing recommendation. No approval process. No minimums.
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Discount on Printer Ink Cartridges. Order American made, eco-friendly Ink Cartridges and save 30–70% over retail stores. Orders are processed and fulfilled with 2–3 day shopping through UPS and FedEx. Free shipping $39.95 or higher. Place orders through http://www.mar.inkbenefits.com/
Join the Relax for Rewards Program FREE. Log into http:// www.thefastpark.com/ marketing/baltimore/sh26edlr.html and complete the application. You will automatically be issued an Airport Fast Park card. Then simply park with us and begin earning points toward FREE parking (accumulate 1 point per day). Note: If you currently have an Airport Fast Park card, you do not have to re-enroll.
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Office Depot Office Depot provides our members access to new and more products and services. With the partnership, MAR members will quality for an instant savings on office supplies, copy and printing services, and promotional products. Additional promotions will be run throughout the year to provide additional savings. For Assistance or questions Contact: Jill A. Johnson; jill.johnson@officedepot.com ; 443-643-6832. Office Depot Business Solutions Division, http://business.officedepot.com—contact Jill for online ordering setup under the account.
UPS
Maryland REALTOR® Rx Program
Looking for bottom line savings? Maryland Association of Realtors® members can now save up to 30% percent on their express air & international shipping through UPS (NYSE: UPS). In addition, the enhanced MAR program now offers member’s savings on UPS ground services! To enroll for the UPS Savings Program can log onto www.savewithups.com/mar or (800) 325-7000. When calling, simply let the UPS Associate know you are a member of Maryland Association of Realtors®. Members enrolled in the original UPS program (enrolled prior to August 2010) must re-enroll to take advantage of this new exclusive offer, so re-enroll today and start saving now!! Re-enroll by logging onto www.savewithups.com/mar or call (800) 325-7000.
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Benefits by Choice Benefits By Choice, Inc. is pleased to offer Maryland Realtors® Association Members a new way to shop for the insurance benefits they need. With our service, you will get comparison quotes from multiple insurance providers. Feel free to shop and find the most affordable Health, Dental, Vision and Life Insurance coverages available, our goal is to enable you to make an informed decision when choosing between several top carriers. If you wish, MAR Members can reach our BBC Representative, Stuart Jackson directly by calling 888-424-4842 ext. 101. All after hour calls will be returned the next business day. Just go to: www.benefitsbychoice.com , Click: Get your complimentary card now! , Click: ScripSave, Your MAR LOG IN CODE 937.
REALTOR® License Plates Show everyone that you’re a REALTOR®. This special plate will set you apart from everyone else as a Maryland REALTOR®. For information or an application, contact Halle Papai at 800-638-6425 or halle.papai@mdrealtor.org. (Vanity plates are not available with this offer.)
Benefits of NAR Membership Real Strength. Real Advantages Participating in a membership of over 900,000 members gives you Real Strength. Real Advantages. NAR serves the diverse interests of all our members who specialize in residential or commercial real estate, including established and new agents, brokers/owners, association executives or board presidents. ■ REALTORS® of all specialties: ■ Enjoy greater earning potential ■ Have access to valuable education and information resources ■ Gain political power ■ Adhere to a strict Code of Ethics Every year, members receive a Membership Reference Guide from NAR outlining the member benefits, educational courses, programs and services available. This Guide also contains an eye-catching membership identification card with the member’s unique NRDS number. Members use this number to take advantage of special offerings from REALTOR VIP® Alliance Partners.
Visit www.realtor.org/programs/realtor-benefits-programs
Visit www.mdrealtor.org to view updated member discounts & benefits
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2013
Life Achievement Award Patrick J. Kane
I
n the early 1970s, Pat Kane worked for Pulte Homes as a building materials purchasing manager, “not
the market’s strongest moment…,”he recalls. Though he wasn’t a member of the sales force, he worked closely
with them, so when sales fell off, he asked to go to a new subdivision the company was building in Baltimore. He sold nine units in a weekend, and never looked back.
Starting his own firm in 1976, Kane was one of the top first-year licensees in the Baltimore County. His extensive involvement in the REALTOR® organizations, at all levels, began when someone recognized his natural teaching and leadership aptitude and asked him to get involved. “I attended a State Teachers College in western Pennsylvania, where I grew up, and always intended to become a teacher,” he explains. It didn’t take long to figure out that as an active member of the REALTOR® associations, he could do both: have his career in real estate, and share his knowledge, principles and experience with others.
22
MARYLAND REALTOR® NOVEMBER 2013
www.mdrealtor.org
From my earliest days,
Kane has served on countless local, state, and national REALTOR®
at every crossroads, there’s always been someone who’s been put in my
committees. He holds the distinction of having served as president of
path to direct me.
three local associations/boards, including the largest and one of the smallest in Maryland: Montgomery County (now Greater Capital Area Association), Garrett County Association, and Greater Baltimore Board. His service at
Kane notes, “but I learned more from
and outstanding leadership to the
each was marked by extraordinary
him than from anyone else in the
real estate profession, and to the
leadership in the local community
real estate business. He taught me
REALTOR® organization at the state
and nationally, including recognition
to hire the right people and treat ‘em
and local level. Recipients are widely
by the Maryland Governor for his
right, and the money would follow.
acknowledged by professional
work on housing affordability in
It’s absolutely true, in any enterprise.
colleagues for the highest level
Montgomery County, and one of
Kane is generous in how he views
of professional competence and
the first HOPE Awards from NAR for
his professional accomplishments.
personal and professional ethics.
“When I reflect on the course of my
Kane received the Lifetime
lifetime,” he comments, “I see the
Achievement Award during the MAR
people who were so very good to
Annual Conference & EXPO in Ocean
Along the way, Kane served on the
me. There are a lot of givers in our
City. In the presentation, Kane was
MAR and NAR Boards of Directors
industry. From my earliest days, at
acknowledged as one of the very
and on various committee and
every crossroads, there’s always
‘givers’ he speaks of, using his time
chair positions. Throughout his
been someone who’s been put in
and talent to mentor and nurture
managerial career, with Hugh T.
my path to direct me. Who I am—my
fellow professionals in the industry,
Peck Properties, and with Coldwell
personality, my ethics— is made up
and make the business better, and
Banker, his passion for teaching
of a hundred different people, at
more respectable, at every turn.
real estate courses and more
least. We’re all affected like this, but
importantly, his ethics and values,
if we can’t see it, we’re missing out
Pat believes that he now enjoys
has continued, within his companies
on a lot.”
and for Montgomery College.
The Life Achievement Award is
Creek Realty in beautiful western
Kane notes that in Baltimore in the
presented to members of the
Maryland. He and his wife Jane
early 1990s, he had the good fortune
Association who have been active in
Ann have five children, four
to work for past NAR President Tom
the real estate industry for at least
grandchildren, and a lovable
Stevens. “He’s younger than I am,”
25 years and have demonstrated
110-pound Shiloh Shepherd.
a citywide campaign in Baltimore to educate consumers about unscrupulous real estate predators.
the best of both worlds, as the owner of Coldwell Banker Deep
through their careers extraordinary
www.mdrealtor.org
MARYLAND REALTOR® NOVEMBER 2013
23
Regulation News
M A R K F E I N R O T H , e s quire
Short Sale Assistance and the Maryland MARS Act
In the last issue, I discussed the revised short sale guidance issued by the Maryland Real Estate Commission (MREC), which outlined the actions licensees may and may not take to facilitate the process of obtaining a lender’s third party approval. This article addresses the Federal and Maryland laws that allow for more extensive assistance to short sellers provided by mortgage assistance relief service (MARS) providers.
M
ARS providers are regulated by the U.S.
is at http://www.dllr.state.md.us/finance/advisories/
Consumer Financial Protection Board (CFPB)
advisory-shortsales.pdf.
and the Maryland Commissioner of Financial
The CFPB rule was originally promulgated by the
Regulation (CFR). Licensed Maryland real estate agents and brokers may elect to be “MARS” providers in addition to their work providing real estate brokerage services, but MARS activities carry regulatory burdens beyond those imposed by MREC. REALTORS® undertaking MARS activities should remember that such actions could produce exposure to liability that is most likely not covered by a real estate broker or agent’s professional liability insurance.
24
Federal Trade Commission. The CFPB adopted both the regulation and the FTC guidance which can be found at http://business.ftc.gov/documents/bus76-mortgageassistance-relief-services-rule. While there is no license or registration required under MARS to provide mortgage assistance relief services, REALTORS® should not underestimate the complexity of these state and federal regulations. The REALTOR® organization does not offer training or forms to practice in this field because the
Under the Maryland MARS Act, adopted earlier this
MREC has taken the position that any activity beyond
year, mortgage assistance relief services are defined as
communicating with a lender on behalf of a short seller
a service, plan, or program that is represented to help
is outside the scope of the Maryland real estate license.
homeowners prevent or postpone foreclosure, or assist
Similarly, most professional liability insurance carried
in getting other kinds of mortgage assistance such as a
by REALTORS® excludes coverage for activities outside
loan modification, collection forebearance, short sale,
the scope of the insured’s real estate license. REALTORS®
deed-in-lieu of foreclosure or extension of time to cure a
should therefore carefully consider whether they have or
default. The Maryland CFR guidance for MARS providers
need insurance coverage for MARS activities.
MARYLAND REALTOR® NOVEMBER 2013
www.mdrealtor.org
The main point of the MARS regulation is that it is
These are only two of the major points of the MARS law
illegal to charge an upfront fee for mortgage assistance
and regulation. While REALTORS® may offer mortgage
services. If you are considering offering MARS service,
relief services, we strongly advise a careful review of
remember that a customer or client must agree in writing
the practice guidelines issues by the CFPB and CFR
to a written offer of mortgage relief from the customer’s
beforehand.
lender, and services must be provided before you may collect any money from a client. There are also several
As always, please feel free to contact me if you have
consumer disclosures required by the law and regulation.
any questions or comments regarding this article or
Customers must be told upfront the total cost of the
other real estate regulatory issues. I can be reached
MARS service, that they can stop using your service at
at mark.feinroth@mdrealtor.org.
any time, that you are not affiliated with the government or the lender and that the lender might not agree to
Mark Feinroth, Esquire, MAR Director of Regulatory Affairs.
change the terms of their mortgage.
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www.mdrealtor.org
130058
MARYLAND REALTOR® NOVEMBER 2013
25
Maryland Real Estate Commission News
katherine connell y
New Broker Test Regulation The Maryland Real Estate Commission has adopted a regulation requiring applicants for a Maryland real estate broker license to pass the written examination within one year of completing the mandated pre-licensing education. The Commission adopted a similar regulation last year for real estate salesperson applicants.
A
broker or associate broker applicant who completed pre-licensing education after August 31, 2013 must pass the licensing test within one year after finishing the pre-licensing course. If the applicant fails to pass the licensing examination within that one year period, he or she must repeat the entire course before retaking the test.
pass the test in the future. Even if the applicant should pass the licensing test, the new licensee would not be aware of developments in the real estate brokerage law that occurred after completing the pre-licensing education. The Commission wants applicants sitting for the exam to have the most current instruction and knowledge of their laws and regulations.
A phase in period of the new “one year” rule allows applicants who completed the pre-licensing course by or before August 31, 2013 to pass the licensing test by February 28, 2014. Applicants who fail to pass the test by the end of February 2014 must repeat the pre-licensing course before retaking the licensing exam.
We recommend that broker applicants plan ahead when preparing to take the licensing examination. Our earlier experience with the one year regulation for salespersons leads us to advise broker applicants that they should allow for time to provide documentation of their completed education and experience to PSI, our test vendor. Because there are only six test locations throughout Maryland and a limited number of seats at each test center, broker applicants should take the licensing test as soon as possible. It is worth noting that broker applicants are permitted to take the licensing test multiple times during the one year window following completion of the mandated education.
The text of the new regulation is posted on the Real Estate Commission website at COMAR 09.11.01.14 at http://www. dsd.state.md.us/comar/getfile.aspx?file=09.11.01.14.htm. Broker applicants who successfully complete Graduate REALTORS® Institute (GRI) classes, series 100, 200, 300 and 400 are eligible to sit for the broker test, provided they have met all other eligibility requirements. REMINDER: You must have three years of experience IMMEDIATELY prior to applying to take the examination. The Commission recognizes the considerable burden for applicants who do not successfully pass the required examination to retake the mandatory pre-licensing education. However, our primary mandate is to protect consumers. We are concerned that an applicant who is unable to pass the licensing examination within one year of completing the education requirement is unlikely to
26
MARYLAND REALTOR® NOVEMBER 2013
As always, please feel free to contact me if you have any questions regarding this or any other issue concerning Maryland real estate license law or practice. I can be reached by email at kconnelly@ dllr.state.md.us. Katherine Connelly is the Executive Director of the Maryland Real Estate Commission. If you have other questions regarding the digital CE record system or any other matter concerning your Maryland real estate license at contact her at kconnelly@dllr.state.md.us or visit http://www.dllr.state.md.us/license/mrec
www.mdrealtor.org
Commercial Connection
D eni s e D ougla s
Commercial Investors In Today's Marketplace Asset Preservation or Asset Accumulation? Commercial investors constantly choose between asset preservation and asset accumulation. The strategy of asset preservation involves keeping current assets modern through investment, while asset accumulation involves the principle of location, location, location and of course, timing.
A
n investor who does not maintain a modern
Regarding asset accumulation, demand is now strong,
property runs the risk of the property becoming
with prospective buyers and tenants indicating a
obsolete and depreciating in market value.
preference for securing an investment. On August 26,
Cassidy Turley recently reported that “. . . since the office
2013, NAR Commercial Real Estate Outlook posted,
sector recovery began in 2010, Class A [office space] has
“Vacancy rates generally are tightening in commercial
absorbed 9.4 msf; meanwhile Class B and C have shed
real estate sectors with modest rent growth. National
3.8 msf.” Looking at asset preservation from a liability
vacancy rates over the coming year are forecast to
prospective, Lee Whitman, general manager at MC Realty
decline .2 percentage point in the office market, .6 point
Group in Kansas City, Mo. recently reported that “a slow
in industrial, and .6 percentage point for retail; however,
economy…increases the potential risk of liability claims
the average multifamily vacancy rate is unlikely to
against property owners…[who are] postponing needed
change, with that sector continuing to experience the
repairs.”
tightest availability and biggest rent increases.”
Recovery
Expansion
Hyper-supply
Recession
Decreasing Vacancy Rates
Decreasing Vacancy Rates
Increasing Vacancy Rates
Increasing Vacancy Rates
Low New Construction
Moderate/High New Construction
Moderate/High New Construction
Moderate/Low New Construction
Moderate Absorption
High Absorption
Low/Negative Absorption
Low Absorption
Low/Moderate Employment Growth
Moderate/High Employment Growth
Moderate/Low Employment Growth
Low/Negative Employment Growth
Negative/Low Rental Rate Growth
Medium/High Rental Rate Growth
Medium/Low Rental Rate Growth
Low/Negative Rental Rate Growth
28
MARYLAND REALTOR® NOVEMBER 2013
www.mdrealtor.org
National vacancy rates over the coming year are forecast to decline .2 percentage point in the office market, .6 point in industrial, and .6 percentage point for retail.
Ritz Ad need this
Additional industry reports cite low mortgage interest rates and restless investors as two reasons why the pendulum is swinging in favor of asset accumulation, and that individuals, businesses, and institutions have expanded the type and size of their real estate holdings. These restless investors should take care to understand the real estate market cycle if they hope to be successful. The cycle, displayed in order of succession,
SELL THE LUXE LIFE
is characterized as follows: Locally, according to Integra Realty Resource’s Viewpoint 2013 report, the office sector in the Washington DC metropolitan area is considered to be in the recovery stage; the retail sector well into the expansion stage, the industrial sector in the recovery stage, and the apartment sector in the hyper-supply stage.
RCR-Baltimore.com
So what does all of this mean? Timing is very, very important. Today’s commercial property investor needs to know where in the cycle a target property is to make an informed decision regarding asset preservation or asset accumulation. A local, commercial REALTOR® is well equipped with the tools and knowledge necessary to
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www.mdrealtor.org
The Ritz-Carlton Residences, Inner Harbor, Baltimore are not owned, developed or sold by The Ritz-Carlton Hotel Company, L.L.C. An affiliate of RXR Realty LLC uses The Ritz-Carlton marks under license from The Ritz-Carlton Hotel Company L.L.C. This is neither an offer to sell nor a solicitation to buy to residents in states where registration requirements have not been fulfilled. MHBR No. 4096. An RXR Realty development. †Services provided by third-party companies are paid a la carte by the resident who requests the service.
MARYLAND REALTOR® NOVEMBER 2013
29
Residential Sales
ANIRBAN BASU
Housing Momentum Positioned to Wane, but for How Long?
T
Higher Mortgage Rates, Seasonality and Washington Will Make Their Mark
here are innumerable factors affecting the housing market at any given moment, some positive, some negative. On the positive side of the ledger are employment creation and stock market performance. As of this writing, we enter our eighth month of sequestration. Despite the disproportionate impact on Maryland, the state’s economy has held its own to date, at least according to the Bureau of Labor Statistics (BLS) Establishment survey. The survey found that Maryland’s economy added 43,300 jobs, or 1.7 percent, to aggregate nonfarm payrolls. That ranks the Free State 16th in the nation in terms of percentage job growth, up from a ranking of 22nd three months prior. Here’s the issue: the Establishment Survey data could be wrong. Indeed, for the period August 2012 to August 2013, the BLS’s Household survey, indicates that Maryland lost 10,580 jobs. And unemployment in Maryland is actually up this year, rising from 6.6 percent in January to 7.0 percent by August of this year. It is theoretically possible to reconcile the data from the two different surveys. Marylanders may be losing positions that they have held in the District of Columbia, Northern Virginia and elsewhere. Those job losses would show up in the Establishment surveys of those other jurisdictions, but the associated unemployment would be reflected in Maryland’s Household survey. The actual answer is most likely somewhere in between the two survey results; the state’s economy has not performed as well as the Establishment survey suggests, but not nearly as poorly as the Household survey indicates. On the negative side of the ledger are higher interest rates, a surge in foreclosures statewide early in 2013, the collateral effects of the now-ended federal government shutdown, fears of U.S. debt default (the debt ceiling was
30
MARYLAND REALTOR® NOVEMBER 2013
only raised until February 7th of next year), confusion regarding the impact of new Maryland storm water taxes/fees, and typical post-summer seasonal factors. Through August, homes sales had held up nationally and locally. Nationally, existing home sales were up by 13.2 percent in August on a year-over-year basis. The national median existing-home price for all housing types was $212,100 that month, up 14.7 percent from the corresponding statistic one year prior. August represented the 9th consecutive month of year-over-year double-digit price increases and the strongest 12-month gain since October 2005. Mimicking the nation, Maryland’s housing market dynamics have also remained positive, with both unit sales and sales prices exhibiting gains in July, August and September. According to data supplied by MRIS and the Coastal Association of REALTORS®, home sales statewide rose 17.2 percent in September on a year-over-year basis; 19 of Maryland’s 24 jurisdictions sales increases over that time span. This performance is at least partially attributable to a race among prospective buyers to lock-in low interest rates during a period of generally rising mortgage rates. The large volume of contracts signed during the summer translated into a significant number of settlements in both August and September. Communities associated with large unit sales increases in September on a year-over-year basis include Baltimore County (25%), Anne Arundel County (23%), Harford County (23%), Frederick County (18%), Montgomery County (17%) and Prince George’s County (15%). In a number of smaller jurisdictions, including Somerset, Charles and Cecil counties, percentage sales increases were even larger.
www.mdrealtor.org
The resilience of Maryland’s housing market in the face of accelerating headwinds is certainly remarkable. Despite the shutdown of the federal government, October and November may end up being a respectable real estate season, at least judging from available leading indicators. Months of inventory had declined to 5.1 months by September, down from 6.0 months one year earlier. Lower inventory implies stable to rising prices, which in turn induces prospective buyers to remain interested in residential markets. Moreover, through September, pending sales were still higher on a year-over-year basis. Statewide in September there were 5,997 pending sales, about 7 percent better than the 5,609 pending sales recorded one year earlier. Nevertheless, these summer statistics do not reflect the impact of the federal government shutdown that began on October 1st, which not only affects local consumer confidence and the local labor market via layoffs and furloughs, but also impacts mortgage financing, as prospective buyers find themselves unable to obtain proof of income or other forms of key information from the Internal Revenue Service or the Social Security Administration. Anecdotal evidence suggests that home showings are down by more than seasonal levels, implying that the discord in Washington, D.C. is now more forcefully affecting local housing markets. Looking carefully at the numbers, one can spot nascent losses of momentum. In the aggregate, active inventory of unsold homes in Maryland has actually risen during the year ended in September, from 26,746 units to 26,850 units. Moreover, while prices are still rising on a yearover-year basis, the pace of gains is softening. In August, average sales price was up 6.4 percent. One month later, the corresponding statistic was just 2.2 percent, roughly equivalent to the general level of inflation for that period. Fifteen jurisdictions reported higher average prices, while thirteen reported higher median prices in September, but momentum appears to have slowed just a bit.
July 2013 vs. 2012 Units
Average Price
County
2013
2012
% Change
2013
2012
% Change
Allegany
31
39
-20.5%
$91,251
$106,478
-14.3%
Anne Arundel
711
538
32.2%
$381,960
$369,434
3.4%
Baltimore City
612
448
36.6%
$188,470
$172,663
9.2%
Baltimore County
786
642
22.4%
$287,015
$261,723
9.7%
Calvert
124
107
15.9%
$332,591
$313,652
6.0%
Caroline
27
25
8.0%
$136,869
$129,816
5.4%
Carroll
182
133
36.8%
$318,230
$303,998
4.7%
Cecil
75
79
-5.1%
$222,961
$235,513
-5.3%
Charles
173
122
41.8%
$253,049
$237,534
6.5%
Dorchester
20
16
25.0%
$144,460
$184,522
-21.7%
Frederick
340
216
57.4%
$308,996
$265,876
16.2%
Garrett
31
20
55.0%
$254,216
$263,810
-3.6%
Harford
319
245
30.2%
$257,934
$252,597
2.1%
Howard
396
316
25.3%
$452,364
$439,347
3.0%
Kent
23
18
27.8%
$268,300
$285,456
-6.0%
Montgomery 1,280
972
31.7%
$529,265
$499,413
6.0%
Prince George’s
748
712
5.1%
$223,870
$190,299
17.6%
Queen Anne’s
58
42
38.1%
$392,124
$361,740
8.4%
Somerset
18
8
125.0%
$102,586
$93,188
10.1%
St. Mary’s
108
77
40.3%
$304,420
$279,087
9.1%
Talbot
53
37
43.2%
$554,870
$289,432
91.7%
Washington
132
98
34.7%
$208,864
$159,680
30.8%
Wicomico
80
71
12.7%
$145,673
$157,774
-7.7%
Worcester
154
142
8.5%
$274,379
$241,357
13.7%
TOTAL 6,481
5,123
26.5%
$335,655
$307,400
9.2%
Figures reflect resales and new properties. Residential resales are reported by MRIS® and local boards MLS systems.
www.mdrealtor.org
MARYLAND REALTOR® NOVEMBER 2013
31
August 2013 vs. 2012 Units
The resilience of Maryland’s
Average Price
County
2013
2012
% Change
2013
2012
% Change
Allegany
50
26
92.3%
$115,643
$95,196
$95,196
Anne Arundel
683
545
25.3%
$367,111
$367,710
$367,710
Baltimore City
593
471
25.9%
$181,313
$161,766
$161,766
Baltimore County
763
682
11.9%
$264,557
$247,842
$247,842
Calvert
120
81
48.1%
$325,923
$307,248
$307,248
Caroline
22
21
4.8%
$136,295
$166,504
$166,504
Carroll
182
154
18.2%
$310,973
$302,747
$302,747
Cecil
88
70
25.7%
$218,519
$231,631
$231,631
Charles
185
156
18.6%
$273,477
$236,914
$236,914
Dorchester
32
15
113.3%
$149,634
$232,817
$232,817
Frederick
312
259
20.5%
$289,838
$291,091
$291,091
Garrett
42
32
31.3%
$321,702
$320,684
$320,684
Harford
268
229
17.0%
$259,655
$263,386
$263,386
Howard
316
324
-2.5%
$435,757
$407,079
$407,079
Kent
21
18
16.7%
$319,107
$291,389
$291,389
Montgomery 1,108
934
18.6%
$516,678
$472,006
$472,006
Prince George’s
709
702
1.0%
$222,359
$192,613
$192,613
Queen Anne’s
56
47
19.1%
$399,464
$383,864
$383,864
Somerset
13
10
30.0%
$106,771
$117,140
$117,140
St. Mary’s
92
94
-2.1%
$280,620
$299,676
$299,676
Talbot
41
39
5.1%
$487,142
$484,597
$484,597
Washington
136
107
27.1%
$203,390
$186,591
$186,591
Wicomico
82
69
18.8%
$168,430
$171,935
$171,935
Worcester
160
145
10.3%
$281,012
$249,357
$249,357
TOTAL 6,074
5,230
16.1%
$319,930
$300,805
6.4%
housing market in the face of accelerating headwinds is certainly remarkable.
Looking Ahead To date, the housing market has managed to retain much of its momentum. But now it faces a new set of headwinds, many of them coming from dissonance in Washington, D.C. For now, the federal government is open and America’s full faith and credit remains intact. However, the latest budget deal only secures an operational federal government through mid-January and further debt ceiling discussions are likely thereafter. All of this means that uncertainty will remain elevated among prospective buyers and financiers. One predicts that the Federal Reserve will remain active in an effort to counter the impacts of this uncertainty, particularly given the nominated Federal Reserve Chair’s apparent willingness to continue to support a low interest rate regime. Anirban Basu, Chairman & CEO, Sage Policy Group, Inc.
Figures reflect resales and new properties. Residential resales are reported by MRIS® and local boards MLS systems.
32
MARYLAND REALTOR® NOVEMBER 2013
www.mdrealtor.org
Maryland Real Estate Commission News
katherine connell y
How Much Do You Know about MRIS Core? 7 ½ MRIS Resources You Should Explore MRIS is always working to improve and add to our suite of MRIS Core products and services. While most customers are familiar with Matrix and Keystone, many more MRIS Core products are included as part of your MRIS subscription and the list is growing!
What Are the MRIS Core Products? In addition to Matrix and Keystone, you also have the following products available to you at no additional cost:
1
Document Management—Upload documents directly to the listing using Document Management. Control who accesses your documents by setting them to Public (available to all MRIS customers) or Private (available only to MRIS customers within your office).
2 3
MRISFax—Easily send large documents via the MRISFax tool. You can send the faxed document as a PDF to up to 10 email recipients in a single transmission! MRIShomes™ Mobile App—Go mobile with MRIS! Login to the MRIShomes™ mobile app with your MRIS ID and password to view additional property information such as list price history, days on market, distressed property information, showing instructions, agent remarks and more. GPS search enables you to search listings wherever you are!
4 5
ListHub—Brokers, syndicate your listings with the nation’s largest online listing distribution and marketing network. With the ListHub dashboard, control and filter how and where your listings get published. RatePlug—Deliver interactive, real-time mortgage programs, payment and qualifying information to your clients. RatePlug provides them with a onestop shopping experience for finding the right home and financing.
www.mdrealtor.org
6 7
RBI Market Statistics (RBIntel.com)—Position yourself as the market expert in your area with upto-the-minute market stats straight from the MLS. You can even embed charts and videos on your website or blog. Short Sale Center—Navigating the short sale process can be difficult, but having access to the right information and resources can help. The MRIS Short Sale Center combines the tools you need to expedite the short sale process, prospect for listing leads and become the distressed property expert in your area.
Learn More in ½ the Time with MRIS-U! Training for each of the MRIS Core products is available by visiting MRIS.com/Training. For those who have interest in training but don’t have much time in your schedule for classes, videos of our most popular classes and quick product tutorials are available 24/7 on mrisTV.com.
More MRIS Core Product and Enhancements Are Coming Soon! From the MRIS MarketingCenter (powered by Imprev) to the ability to edit listings right from the MRIShomes Mobile App, there is a wealth of new products coming soon. One of the best ways to stay current with MRIS news, product sneak peeks and exclusive promotions and events is to interact with us on our social media channels. If you haven’t connected with us on MRISblog. com, Facebook or Twitter, you might miss out on what’s happening at MRIS. Visit us at MRISblog.com, like MRIS on Facebook, and follow @MRIS_REal_News on Twitter to keep in touch with MRIS! MARYLAND REALTOR® NOVEMBER 2013
33
SNIPPETS Create your own blog Express your ideas to the world and invite responses. This service is high quality, and it’s free!* https://www.blogger.com/start
Slideshare.com Upload and share your PowerPoint & Keynote presentations, Word & PDF documents on Slideshare. Add audio to make a webinar. Capture leads with your presentations. Tutorial available.
Anywho
Issuu.com
Anywho is a great online phone book and peoplefinder sponsored by AT*T. Use the Yellow Pages for businesses, the White Pages for people, and the Reverse Lookup if all you have is a phone number.*
Browse through magazines, artist’s portfolios, or upload your own created documents. A great place to gather publications and discuss topics you find interesting. Check it out!
http://www.anywho.com/whitepages
The Internet Movie Database (IMDB) The Internet Movie Database (IMDB) is a movie-lover’s paradise. Discover every movie, your favorite actor/actress has been in, discover every actress/actor in your favorite movie! All the facts about all the films will be found here.* http://www.imdb.com
34
MARYLAND REALTOR® NOVEMBER 2013
http://fiverr.com Five Bucks doesn’t get you much anymore, but here’s a website www.fiverr.com where you can, for example, find someone to plan what to do for a day in Chicago; create two professional web banner ads for $5; or create a custom Facebook photo string for your profile for $5. Someone will even make a friendship bracelet for $5, or how about a pair of earrings of Marilyn Monroe’s likeness on guitar pics. Amazing!
www.mdrealtor.org
™
Pic Font Have you ever wanted to add text on top of a photo for a property you have listed? Here’s a fun FREE Web Site you can use to upload your photo, add a line or two of text, then download back to your computer to use in documents, flyers the Web and more. Visit: www.PicFont.com Contributed by John D. Mayfield — The business Tech Guy — www.BusinessTechGuy.com
If you have a ‘ridiculously useful website’ to share with fellow REALTORS®, email: jermaine.hawkins@ mdrealtor.org
The sites are presented for information only. MAR is not responsible for
SEE THE SAVINGS
SEE HOW MUCH YOU CAN SAVE.
the content of external websites and does not endorse them or their functionality. Although we make every effort to ensure these links are accurate, up to date and relevant, MAR cannot take responsibility for pages maintained by external providers. Views expressed by individuals and organizations on their own websites are not necessarily those of the Maryland Association of REALTORS®.
www.mdrealtor.org
MARYLAND REALTOR® NOVEMBER 2013
35
From the Hotline
charle s A . K a s k y , e s quire
Pocket Listings—What You Need to Know
Q.
I have heard a lot of discussion recently about “pocket listings.” I’m not sure what that means. Can you explain the term? If a seller and broker enter into a listing agreement but agree to delay putting the information into the MLS while the seller prepares the property for showing, is that a pocket listing?
As a practical matter, home sellers and listing agents/brokers must be aware that the decision to forego placing the property in the MLS can adversely affect their goal of getting the best price possible for the property. Active marketing to the widest possible audience has long been recognized as the most effective means to accomplish this goal. Any practice that undermines this principle can have far-ranging consequences.
Your questions are timely and raise issues that have been the subject of much controversy with the real estate industry in recent months. Although this is not a new concept, “off-MLS” or “pocket listings” are properties that are marketed without being listed for sale on the MLS. The term refers to the fact that the listing is being “hidden” in the broker’s pocket.
Brokers should also consider the risk management implications of the practice. On one hand, the allure of earning both the listing and selling sides of the commission is strong. On the other hand, Maryland law governing dual agency is somewhat complex compared to other states and must be strictly followed.
A.
Sometimes, a listing is merely referred to as a pocket listing in the short time between when it is secured by the sellers’ agent and the time it appears on the MLS. A listing can sell before the broker completes MLS paperwork, and the listing sold to someone who knew about it outside of the MLS. Sometimes, this happens with an offer made during a “prelisting” period. The National Association of REALTORS® has not defined what constitutes a pocket listing, nor does it have an official policy regarding the practice. But REALTORS® are bound by the Code of Ethics to get the best deal for their client. Sellers should be cautioned that restricting a large pool of eligible buyers from knowledge of the sale might reduce the final sale price. There are objections to some of the ways these so-called pocket listings are used by some real estate professionals. Some practitioners argue that pocket listings violate local MLS rules. Others worry that keeping properties from the MLS may skew comparable listing numbers for appraisers. Still others worry that pocket listings could lead to abuses of single and dual agency relationships, if not properly handled.
36
MARYLAND REALTOR® NOVEMBER 2013
Consider, too, that sellers sometimes find out later that their home could have, and probably should have sold for a higher price, leaving the broker exposed to allegations that the broker breached his fiduciary duty to the seller. A recent article from California illustrates this point, without addressing it. A young couple purchased a pocket listing for $640,000 and within 4 months a smaller, slightly more updated house down the block went on the market for $100,000 more. What would a reasonable seller’s reaction be to the news that she may have left as much as $100,000 “on the table” because the property was marketed only to buyers selected by the listing agent? To answer your second question directly, there is nothing inherently illegal or unethical about the practice you propose, but it must be done with the utmost care that it, and all actions you take, are truly in the best interest of your client and with the client’s informed consent. That means that the seller is given the pros and cons of each choice. You should take care that this not be a subterfuge to undermine the integrity of the cornerstone of the industry – cooperation with other brokers to secure the best price and terms for the client. Charles A Kasky, Esquire, Senior Vice President, Maryland Association of REALTORS®.
www.mdrealtor.org
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