Illinois REALTOR® January 2020 by Illinois REALTORS®

JANUARY 2020

THE VOICE FOR REAL ESTATE IN ILLINOIS

What's ahead for the housing market in 2020

REALTOR power in Springfield ®

Illinois legislators with real estate backgrounds bring knowledge and advocacy to the Capitol www.IllinoisRealtors.org

THE OFFICIAL PUBLICATION OF ILLINOIS REALTORS® ILLINOIS REALTOR® January 2020

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TABLE OF CONTENTS JANUARY 2020

04 Inside Track

New year, new goals

05 President's message

REALTOR® power in Springfield

Education a huge part of RELA rewrite process

Planning tips to make the most of your winter downtime

06 Quick Takes

• Guzmán tapped for NAR 2020 leadership • Haisler to serve as AE Institute Dean

• Six members receive presidential medallions

The typical Ill inois REALTO ® R

09 Legal

New sexual harassment prevention training for real estate brokerages

10 Top 5 legal hotline topics from 2019 30 Forecast

What’s ahead for the housing market in 2020?

Don’t be a wallflower

32 RVOICE

Strategies for better networking skills

Advocacy around Illinois

34 Outreach

Your office may be on the map

37 Ethics

Are you interfering with an exclusive relationship?

38 Community

Industry side gigs to grow your bottom line

24 Meet Good Neighbor Dale Taylor ILLINOIS REALTOR® January 2020

INSIDE TRACK It’s time for New Year’s resolutions. What is a business goal you want to accomplish in 2020? I’m going to sit down and list my financial and production goals for the next year, then determine several actions to accomplish these goals. One way I stay on track through the year is to give myself a prize if I meet my goals. One year it was a family cruise, another year it was hardwood floors for my home. When I look at the photos from my cruise or gaze at my floors, I know I earned it! Shelley Berendt

The Real Estate Group, Springfield

ILLINOIS REALTORS®

THE VOICE FOR REAL ESTATE IN ILLINOIS 2020 OFFICERS President Ed Neaves eneaves@thesnydercompanies.com President-elect Sue Miller, ABR, BPOR, C2EX, CRB, CRS, GRI, ePro, LTG, PMN, SFR, SRS smiller001@aol.com Treasurer Ezekiel "Zeke" Morris zekemorris@zekemorris.com Chief Executive Officer Gary Clayton, CAE, RCE Deputy Chief Executive Officer Jeffrey T. Baker Executive Vice President Kristen Butcher, CMP Vice President, Communications Jon Broadbooks Senior Editor Stephanie Sievers Content Marketing Specialist Bill Kozar Graphic Designer David Hine

My business goal for 2020 is to close $150 million. To do that we plan to have more of our listing appointments in the office so clients can see our whole operation and marketing plan in detail. We’ll also be even more selective in who we take on as clients to make sure everyone has the best possible experience. Leigh Marcus

@properties, Chicago

If you are not contacting your sphere of influence, then you are not doing your best when it comes to client communication and lead generation. My goal for 2020 is to get ‘back to basics’ and think like a first-year agent again and really focus on communicating with my sphere better. Hillary Joy

RGM Real Estate Co., St. Charles *Answers provided are the personal opinions of the members questioned and do not constitute endorsements or sponsorship by Illinois REALTORS®.

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For advertising information contact Advertising & Sponsorship, 217-529-2600, info@IllinoisRealtors.org The ILLINOIS REALTOR® (ISSN 0744-221) is published four times a year during the months of January, April, July, and O ctober by the Illinois REALTORS®, Post Office Box 19451, Springfield, Illinois 62794-9451. Periodical postage paid at Springfield, Illinois and at additional mailing offices. Postmaster: Send address changes to: The ILLINOIS REALTOR®, Post Office Box 19451, Springfield, Illinois 62794-9451, 217-529-2600. Opinions expressed in any signed articles of the ILLINOIS REALTOR® are those of the author and do not necessarily represent the opinions of the Illinois R EALTORS®. Advertising of product or services does not imply endorsement. Advertising rates are available at www.IllinoisRealtors. org or on request. A nnual dues of every REALTOR®, R EALTOR-ASSOCIATE®, and Affiliate member include $3 for a one-year subscription to the ILLINOIS REALTOR®.

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PRESIDENT'S MESSAGE Education a huge part of RELA rewrite process

Ed Neaves

2020 President

Get the latest RELA news

Illinois REALTORS® legal team provides updates on the Real Estate License Act for the association’s members. The updates can be accessed at www. IllinoisRealtors.org/ RELA-Rewrite. (Login required)

Whenever there is a major change in the state’s laws governing real estate, there is a lot of behind-the-scenes work involved for Illinois REALTORS®. The result of months of work by the association’s advocates and members was the signing into law of the Real Estate License Act (RELA) in August by Gov. J.B. Pritzker. It set new standards for education and professional practice and seeks to clarify advertising and marketing rules. The governor’s signature launches an extensive rule-making process, as regulators and Illinois REALTORS® work to make sure the law best serves the industry and consumers. Which brings us to the second – and equally important – part of the postpassage process. Illinois REALTORS® now has the big job of making sure our

50,000 members fully understand the rule changes and what they mean. In the past few months, the association’s legal team has created a home for all RELA-related updates on the Illinois REALTORS® website. This webpage provides the latest news and guidance on how the changes will affect real estate practitioners in the state. In addition, the association is working on a variety of education offerings to make sure our members understand how the new law will apply to their businesses. Making sure REALTORS® have a voice in the rewrite is important. Providing the education on the law’s impacts is one of the many critical “value-adds” your association brings to its members as we enter a new year.

Ed Neaves, president Illinois REALTORS® ILLINOIS REALTOR® January 2020

QUICK TAKES Public transportation proximity = higher real estate values Easy access to public transportation provides several advantages to community residents, including a boost to commercial and residential real estate values, according to a report, “The Real Estate Mantra: Locate Near Public Transportation,” by the National Association of REALTORS® (NAR) and the American Public Transportation Association (APTA). The study analyzed rent, neighborhood characteristics, housing affordability, local government interventions

3 YEARS

NAR has extended the Code of Ethics training requirement from every two years to three years. That extends the current Cycle 6 deadline from Dec. 31, 2020 to Dec. 31, 2021.

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and residential/commercial sales from seven U.S. metropolitan regions, NAR reported. They were: Boston; Eugene, OR; Hartford; Los Angeles; Minneapolis-St. Paul; Phoenix; and Seattle. The findings: Residential properties with access to heavy rail, light rail, commuter rail and rapid bus transit had 4 to 24 percent higher median sales prices between 2012 and 2016. Commercial property median sales prices increased between 5 to 42 percent per square foot, NAR reported.

Read more at bit.ly/NAR_PublicTransit

Guzmán tapped to serve on NAR 2020 leadership team

Mabél Guzmán, a broker for @properties in Chicago, was named NAR 2020 vice president, association affairs. She is a past president for the Chicago Association of REALTORS® and served on the NAR workgroup for the 50th Anniversary of RPAC. She’s been a Major Investor since 2008 and has been a member of the President’s Circle since 2015. In 2019, she was inducted into the NAR RPAC Hall of Fame. She is the Illinois REALTORS® State Legislative Contact for Sen. Iris Martinez of Chicago.

Residential appraisal threshold raised from $250K to $400K Under a new rule that went into effect in October, many homes valued under $400,000 now only need an evaluation and not an appraisal to determine the estimated market value of a property. The appraisal exemption does not apply to loans sold or guaranteed by the Federal Housing Administration, Department of Housing and Urban Development, Department of Veterans Affairs, Fannie Mae or Freddie Mac, according to NAR. bit.ly/New_Appraisal_Exemption

Have you heard? New Illinois podcasts since the last issue

Illinois REALTORS® is regularly adding new episodes to its podcast library. This member benefit offers a new way for you to get in-depth information about everything from license law updates and industry policy issues to marketing and business strategies. Here are some of the latest podcast headlines:

• Meet Dale Taylor, Illinois REALTOR® and NAR Good Neighbor Award Winner • Learn why a proposal to boost transfer taxes in Chicago hurts everyone • Illinois REALTORS® Industry Partners tell you how to expand your network Illinois REALTORS® podcasts are available through iTunes, Spotify, Tune In and Google Play Music. With iTunes, get access to the podcasts as they come out by choosing to “subscribe” to Illinois REALTORS®. With Spotify, choose “follow” Illinois REALTORS®. With Tune In, click the “favorite” button. With Google Play Music, choose “subscribe.”

Haisler to serve as AE Institute Dean Congratulations to Jim Haisler, CEO of Heartland REALTOR® Organization, who will serve as the dean of the National Association of REALTORS® Joint AE Institute in San Diego, March 13-16. The AE Institute is the premier professional development event for local and state REALTOR® association and MLS staff.

Six Illinois REALTORS® receive presidential medallions

Doug Carpenter, Sue Miller (two), Michael D. Oldenettel, Nykea Pippion McGriff, Matt Difanis and Sarah Ware were recognized with presidential medallions for their outstanding contributions to the real estate industry and Illinois REALTORS® during the past year.

Doug Carpenter

Sue Miller

Michael D. Oldenettel

Nykea Pippion McGriff

Matt Difanis

Sarah Ware

NAR cracks down on ‘pocket listings’ Listing brokers who are participants in an MLS will be required to submit listings to their MLSs within one business day of marketing the property to the public, according to the Clear Cooperation Policy, also known as MLS Statement 8.0, approved by the NAR Board of Directors in November. MLSs must implement the plan by May 1, 2020. “Pocket listings” – private, off-MLS properties also known as office exclusives or “coming soon” properties – had become popular in some competitive markets. Learn more from NAR, bit.ly/NAR_MLS_Policy ILLINOIS REALTOR® January 2020

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LEGAL

New Illinois sexual harassment prevention training will impact real estate brokerages By Anneliese Fierstos, Legal Hotline Attorney On May 10, 2019, new sexual harassment prevention training requirements for licensed professionals in Illinois went into effect pursuant to legislation and related rules governing all licenses administered by the Illinois Department of Financial and Professional Regulation (IDFPR). Under the rules, all who hold professional licenses issued by IDFPR and are subject to a continuing education requirement are required to complete a one-hour course in sexual harassment prevention. Completion of the course is now a condition of renewing a professional license. Illinois REALTORS® has developed a training program to assist licensees in meeting the requirements required by IDFPR. In addition to the new continuing education requirements for IDFPR licensees, brokerages employing both licensed and unlicensed individuals will also be subject to comprehensive legislation designed to prevent sexual harassment and discrimination in the workplace. The new legislation goes into effect on Jan. 1, 2020, and imposes new responsibilities on sponsoring brokerages as employers. One of the new laws created in this legislation

Illinois REALTORS® Licensing & Training Center has elective courses available online that will satisfy the Sexual Harassment Prevention Training renewal requirement. For more information, visit the store on the Illinois REALTORS® website at bit.ly/IllinoisRealtors_CE

is the Workplace Transparency Act, which amends the Illinois Human Rights Act and imposes significant new responsibilities on employers. The new law addresses many aspects of workplace discrimination and harassment and expands protections to non-employees, such as the typical licensee working under an independent contractor agreement. Under the Workplace Transparency Act, an employer can be held liable for harassment that substantially interferes with a non-employee’s or independent contractor’s work performance or creates an intimidating, hostile or offensive working environment for members of a protected class. The Workplace Transparency Act obligates all employers to provide annual sexual harassment prevention training to all employees (including independent contractors). The training must be equal to or exceed standards of the model training program which is being developed by the Illinois Department of Human Rights (IDHR). IDHR is in the process of drafting the training program. The program will be

automatically approved for use, although others will be allowed as long as they meet the criteria outlined and required by the Workplace Transparency Act. As a result, most employers will likely opt for this program. Furthermore, starting July 1, 2020, and every July 1 thereafter, all sponsoring brokerages who act as employers will be required to report annually to IDHR any settlement, adverse judgment or administrative rulings against them involving harassment or discrimination that occurred during the previous year. IDHR will use the compiled information to publish an annual report. Failure to comply with the reporting requirements could result in monetary penalties. Prior to Jan. 1, 2020, any brokerage that employs licensed or unlicensed assistants should review and revise their employment agreements to include a provision that employers and independent contractors complete all mandatory training on an annual basis. In addition, they should evaluate and revise their sexual harassment and discrimination policies and procedures. ILLINOIS REALTOR® January 2020

LEGAL UPDATE Top 5 legal hotline topics from 2019

Anneliese Fierstos Illinois REALTORS® Legal Hotline Attorney

MORE TO COME ON RELA Illinois REALTORS® plans videos, podcasts and other education resources in early 2020 as rules for the RELA rewrite move through the legislative rulemaking process.

Have a legal question?

The Illinois REALTORS® Legal Hotline is the Designated REALTOR®/ managing broker’s go-to source for legal information. Hours: 9 a.m. - 4 p.m. Monday – Friday Phone: 800-952-0578 Email: afierstos@ IllinoisRealtors.org.

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The Illinois REALTORS® Legal Hotline fields several thousand calls and emails throughout the year. Questions about business practices under the Illinois Real Estate License Act, contracts to purchase and disclosure, advertising, escrow rules and changing brokerages rounded out the top five issues. This article examines these frequent legal questions and offers sample scenarios and answers.

License law and business practice

The recent changes to the Illinois Real Estate License Act (RELA) have effectively brought the practice of wholesaling under the purview of the Illinois Department of Financial and Professional Regulation (IDFPR). The law includes the practice as one of the licensed activities under the definition of the term “broker” in the Act. This change will protect the average consumer by making certain that this activity can only be conducted by an individual or entity that is licensed in the state of Illinois, which imposes certain duties on the licensee, such as disclosure of licensee status and disclosure of No Agency to the other party (due to the prohibition against dual agency where the licensee has an interest in the subject property). The new legislation makes an addition to RELA, requiring a broker’s license to encompass an individual or other entity who, “whether for another or themselves, engages in a pattern of business of buying, selling, offering to buy or sell, marketing for sale, exchanging, or otherwise dealing in contracts, including assignable contracts for the purchase or sale of options on real estate or improvements thereon.”

The definition clarifies “pattern of business” as follows: “an individual or entity will be found to have engaged in a pattern of business if the individual or entity by itself or with any combination of other individuals or entities, whether as partners or common owners in another entity, has engaged in one or more of these practices on two or more occasions in any 12-month period.”

Contracts to purchase: Disclosures under the 7.0

Advertising under RELA rewrite:

The Multi-Board Residential Real Estate Contract 7.0 arguably allows a seller to avoid gaining “actual knowledge” of a material defect that has been revealed by an inspection. The contract provides, “Buyer shall not send any portion of the inspection report with the Notice provided under this subparagraph unless such inspection report, or any part thereof, is specifically requested in writing by Seller or Seller’s attorney.” But does this provision really protect the seller? The question turns on how a court would interpret that avoidance technique in the event a cause of action was brought against a seller under the Residential Real Property Act. Once a buyer gives notice to a seller that they are terminating the contract under the provisions of Paragraph 12 of the 7.0, it may be difficult for a court to accept the Seller’s claim that they have no knowledge of a material defect in the property in future transactions.

The RELA rewrite does provide that in advertising which includes the sponsoring broker’s name and a team name or individual broker’s name, the

sponsoring broker’s business name shall be at least equal in size or larger than the team name or that of the individual. This provision was added in response to industry concerns that licensees were not properly representing their association with sponsoring brokerages and it was misleading to the general public. IDFPR appears to recognize that bringing all advertising into compliance with the provisions of the rewrite may be financially burdensome to some licensees. IDFPR has indicated to the Illinois REALTORS®ʼ legal team that they do not expect immediate compliance, but do expect a showing of “due diligence” in efforts to bring all advertising into compliance over the next several months.

License law: Special accounts – escrow disputes revisited

In recent weeks, the hotline has been flooded with questions about what a sponsoring broker should do if they are holding escrow funds, a sale falls through and at least one party is demanding return of the funds. The guidelines for handling escrow disputes are found in Section 1450.750 (h) of the rules under RELA. Generally, the rules require that a sponsoring broker, who has knowledge that a party to a transaction contests or disagrees with an anticipated disbursement of escrow moneys held by that sponsoring broker, must continue to hold the funds in their escrow account

until one of three things occur: 1. The sponsoring broker receives a written release from all parties or their duly authorized agents (i.e. an attorney at law or power of attorney) consenting to the disposition (in which case, the funds must be disbursed according to joint written direction from the parties no later than the next business day after receiving the written release); 2. A civil action is filed, by either the sponsoring broker holding the escrow funds or a party to the transaction, seeking a court order instructing the sponsoring broker how to distribute the funds; or 3. The funds are turned over to the Illinois State Treasurer, Division of Unclaimed Property under the Uniform Revised Unclaimed Property Act [765 ILCS 102-6] due to inactivity of the account, inability to locate the parties, or inability to reach a resolution. The first option above is fairly straight-forward and easy to follow. However, things become more complicated when one or both of the parties will not sign the written release. Often, a sponsoring broker does not want to let the funds sit in their escrow account and wait three years before they can transmit the disputed funds to the Illinois State Treasurer. In those cases, a sponsoring brokerage can retain the services of an attorney for

purposes of filing an interpleader action. The interpleader action allows for the sponsoring broker, as a neutral third party, to avoid liability to any claimant by forcing the claimants to litigate among themselves and let the court determine who should receive the funds. Another option is to suggest to the party claiming the escrow funds, and refusing to sign the release, that they may want to seek independent legal counsel for purposes of filing an action in civil court seeking a court order for distribution of the funds. There is also a provision in RELA which allows a sponsoring broker holding money in escrow to transmit disputed funds to the unclaimed property division of the Illinois State Treasurer within six months of a written demand for a return of the funds. This is an option as long as a lawsuit has not been filed. It should also be noted that this action does not resolve the dispute, but only moves it to another venue.

Changing brokerages? Who owns the listing agreements?

If a licensee is changing brokerages, and the licensee has listings in place that have yet to close, the question often arises whether the license can take listings with them to the new brokerage. The general rule is that the listings belong to the sponsoring brokerage with which the license was associated at the time the listing agreement was entered. In some cases, the employment agreement or independent contractor agreement might have different provisions or provide for some compensation to be paid to the listing agent after the agent leaves. The agent who leaves must cease working with the listing client unless the current listing company has agreed to allow the departing licensee to take the listing to the new sponsoring company.

ILLINOIS REALTOR® January 2020

REALTORÂŽ power in Springfield Illinois legislators with real estate backgrounds bring knowledge and advocacy to the Capitol By Stephanie Sievers

There are 177 members of the Illinois General Assembly, all representing different constituents, interests and communities around the state. But some legislators come to Springfield with the unique experience of working in the real estate industry. Some are residential or commercial REALTORS®. Some are builders and developers, while others are appraisers. All have been involved in the industry in ways that have given them a better understanding of real estate and its impact on the state. Illinois REALTOR® talked to these property rights advocates about their backgrounds, why they chose to run for elected office and what it means for the real estate industry to have these industry advocates in Springfield.

From left to right, top to bottom: Sen. Bill Brady, Rep. Joe Sosnowski, Rep. Sam Yingling, Rep. Fred Crespo, Rep. David A. Welter, Rep. La Shawn Ford, Sen. Jason Barickman and Rep. Tony McCombie. PHOTOS AND COVER PHOTO BY TERRY FARMER PHOTOGRAPHY

Senator

Bill Brady

R-Bloomington Senate Republican Leader Illinois House 1993-2001 Illinois Senate since 2002

Sen. Bill Brady’s legislative path has taken him from the Illinois House of Representatives to the Illinois Senate and his current leadership role as Senate Republican Leader. But Brady first started his career as a REALTOR® and has found that experience has given him a unique perspective when it comes to the issues and policies that come before him in Springfield. “It’s important that we have legislators who understand the challenges that face the people that we represent every day,” he said. “I bring a perspective, others bring different perspectives, that hopefully give us the background we need to make the right decisions.” “REALTORS® really get to know everybody (in a community) and bring that perspective and knowledge,” he said. For Brady, some aspect of real estate has always been the family business. His father was a homebuilder, developer, property manager and lumber yard owner in the Bloomington area. When Brady graduated from college, the economy had slowed so he stayed in his hometown to help rebuild the family business. Brady decided an important part of the business plan would be starting a real estate brokerage company. So, in his early 20s, he opened a brokerage and hired his mother as one of his first agents. Today, he is the owner of RE/MAX Choice with offices in Bloomington and Champaign and RE/MAX First Choice with two locations in Florida. In Springfield, Brady says one of his key priorities is protecting private

property rights. “I believe the private property rights of our citizens are paramount to our development and prosperity,” he said. “We worry about overburdensome regulations such as rent controls and other issues that may sound good to people on paper, but the implications of them actually end up reducing the availability of affordable housing to people in need as an unintended consequence.”

Representative

La Shawn Ford D-Chicago

Illinois House since 2007

Originally a public-school teacher, Rep. La Shawn Ford began working part-time as a REALTOR® to bring in extra revenue. But Ford switched to real estate full time because he enjoyed a profession where he could make people happy. Ford’s real estate business, Ford Desired Real Estate, is concentrated in the Chicagoland area. Even after years in the General Assembly, Ford says he will always be active in the real estate business. “I’ll do real estate for the rest of my life,” he says. “I love real estate.” He has also found his background in real estate helpful to his work in Springfield. He can share his industry perspective with his legislative colleagues and help them understand how a bill could impact property owners. It’s beneficial to have lawmakers who are knowledgeable about the industry to bring balance and compromise on legislative proposals, he said. For example, Ford sponsored and passed legislation that made improvements on the complex issue of disputed escrow funds. It’s important to have strong advocacy from rank-and-file Illinois REALTORS®, ILLINOIS REALTOR® January 2020

There are more Illinois legislators who work as REALTORS®, or have in the past, and bring that expertise and valuable industry knowledge to the political process in Springfield.

Ford says. Member involvement sends a strong message to lawmakers. “When you have advocacy from those in the profession, that’s the best signal and has the most impact,” he said.

Representative

Mark Batinick Rep. Fred Crespo

D-Streamwood, Assistant Majority Leader, Illinois House since 2007

Rep. Keith P. Sommer

R-Morton, Illinois House since 1999

Rep. Joe Sosnowski

R-Rockford, Illinois House since 2011

Rep. Keith R. Wheeler

R-North Aurora, Assistant Republican Leader Illinois House since 2015

Rep. David A. Welter

R-Morris, Illinois House since 2016

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“It’s good to have somebody in there who understands the industry because sometimes something may seem innocuous, but when you talk to somebody in the industry, you understand how it affects them greatly, either negatively or positively,” Batinick said. “Real estate touches everyone’s life one way or another.”

R-Plainfield

House Floor Leader Illinois House since 2015

It was Rep. Mark Batinick’s work as a commercial REALTOR® with RE/MAX Professionals Select in the Plainfield area that prompted him to run for political office. He works with a variety of commercial clients on everything from office, land, retail and industrial properties. It was his role as a REALTOR® which brought an awareness of how property taxes and regulations could have a dramatic impact on business growth. “When you’re dealing with people making major decisions for their businesses, you learn a lot about what is going on in your community – the good and the bad,” Batinick said. Now that Batinick is in Springfield as a lawmaker, two issues are top of mind: pension debt and property taxes. During the November veto session, Batinick was the Republican point person during House floor debate on a bill that allowed consolidation of hundreds of suburban and downstate fire and police pension systems. The legislation passed and is expected to be signed into law. “There is direct property tax pressure that will be relieved because of the bill,” Batinick said. Batinick has found that being a REALTOR® has given him a wellrounded background to understand the implications of issues in Springfield.

Representative

Sam Yingling D-Round Lake Beach Illinois House since 2013

Rep. Sam Yingling agrees the state’s property tax burden is the biggest crisis facing Illinois. He also believes the political willpower is finally there to do something about it. “It has taken a number of years, but I think members of the General Assembly recognize that this crisis has to get tackled and it has to get tackled immediately,” he said. An anticipated report from the Property Tax Relief Task Force by the end of 2019 could shed more light on the problem and offer potential solutions. Yingling anticipates a variety of property tax-related bills in the upcoming session. Yingling said his background in real estate is invaluable as he deals with state policy issues such as property taxes. After graduating from college, he joined his family’s real estate business, New Century Real Estate in Round Lake Beach. He decided to run for his first political office, Avon Township Supervisor, after hearing residents and business owners complain about the dysfunction of the property tax system. The experience left him thinking less government was the answer, not more. He believed the township layer of

government was unnecessary and called for the elimination of his own position. Then he found there was no mechanism in place to allow for a township to dissolve. So, Yingling ran for state representative to push for more consolidation and better government efficiencies and that is something he still pursues in Springfield. Another area of focus: Giving residents and tenants more protections from municipalities and governments entering their properties without notice. He sponsored legislation that passed out of committee in 2019 but didn’t get final approval on the floor. He plans to pursue it again this year.

Senator

Jason Barickman R-Bloomington Assistant Republican Leader Illinois House 2011-2012 Illinois Senate since 2013

Sen. Jason Barickman’s background in the real estate industry is two-fold. He’s a partner specializing in commercial real estate transactions with the Champaign-Urbana law firm, Meyer Capel, and he is a partner with the central Illinois real estate development company, Fairlawn Capital. “Real estate to me tells a great story of the importance of supply and demand,” he said. Barickman sees that dynamic play out in his investment company’s efforts to provide more affordable rental housing options. The company buys apartment complexes and rental properties that need improvements and turns them around into sought-after, but still affordable rental units. Creating a larger supply of affordable rental housing is a better solution than recent efforts by some to push for Rent

Control, he said. “There’s a shortage of supply available to people on the lower- and middle-income end of the spectrum,” he said. “I believe the answer to that is to create more supply; it’s not to try to manipulate the market and what the rent might be in certain locations.”

Legislative issues to watch in 2020 The Illinois General Assembly returns

to Springfield on Jan. 28 for the start of the 2020 legislative session. Thousands of bills are introduced during spring

sessions, hundreds of which could be of

interest to the real estate industry. Here are a few key issues to watch for:

Representative

Tony McCombie R-Savanna

Illinois House since 2017

Most people don’t know or realize how important their voice is to legislators who want to hear their constituents’ questions, concerns and input, says Rep. Tony McCombie, who owns Blue Appraisals in Savanna and is a real estate broker with Mel Foster Co. When McCombie was starting out as a REALTOR®, she wondered what her RPAC donations were doing for her. Now that she is in Springfield, she sees the benefits of REALTOR®-supported advocacy up close. “I’m telling you what it does – it gets people who are like-minded elected and it gives people in our industry a seat at the table,” she said. You may not get everything you want, but it gives your group a voice and elected officials listen because you know the industry, she said. Finally, REALTOR® legislators also know how important it is for people to feel safe and sustainable in their homeownership and community investment, McCombie said. “We understand the (impact) of accessed values and property tax issues and look at how things passed into law really do hurt the bottom line,” she said. “REALTORS® in the House and Senate understand that a little better than others.”

Findings from the Property Tax Relief Task Force – In 2019, lawmakers

passed legislation creating a statewide task force to review best public policy

practices and make recommendations for short- and long-term changes

needed for property tax relief. The final report was due Dec. 31, 2019.

Push for Rent Control likely to continue – There were several Rent Control-related bills introduced in

2019 and Illinois REALTORS® were

outspoken in their opposition with more than 10,000 members participating in

Calls for Action on the legislation. Rent Control is expected to be an issue in upcoming sessions.

City of Chicago graduated transfer tax – The city of Chicago failed to

generate enough Springfield support for a “graduated” real estate transfer tax

during the 2019 veto session. The city

seemed to switch gears and looked to

increase the property tax levy, but Illinois REALTORS® will continue to watch for

repeated efforts in the spring session.

Transaction issues – Legislation

affecting title insurance, fees and other steps along the real estate

transaction process are perennial areas of legislative interest.

Affordable rental housing – In 2019, there were several measures aimed at offering property tax incentive

proposals to create more affordable,

low-income housing properties. Similar legislation could be pursued this year.

ILLINOIS REALTOR® January 2020

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Industry side gigs that can help boost your bottom line By Stephanie Sievers, Senior Editor Many Illinois REALTORS® focus their real estate businesses on helping consumers buy and sell homes. But some add side businesses which allow them to get paid to do something they love or accomplish a business goal they’ve always had. Illinois REALTOR® talked to four REALTORS® about their successes with side gigs and what others need to know to get started.

Vacation rental

Judy Gibbons, a broker with Jameson Sotheby’s International Realty in Chicago, had a long-time goal of someday buying an investment property. She was thinking of a three-unit building or another type of rental investment in the city, but after a colleague bought a cottage in Michigan, she changed her mind. She started thinking instead about buying a vacation property that she could rent out on Airbnb while also using it herself. In 2016, she and her husband bought a two-bedroom, two-bathroom cottage in Lakeside, Mich. Located in the touristy Harbor Country and within walking distance to Lake Michigan,

their Dunedin Cottage quickly booked up the first summer and continues to be popular year-round. “It’s been such a source of pride,” Gibbons said. For a REALTOR®, vacation rentals make sense, she said. They know houses, they have staging tools and the extra source of cash flow is a plus, she said. “It’s a great opportunity for people in real estate to expand their business and have fun,” Gibbons said. Her advice to others getting started in rentals? Do your research and talk to a lawyer about what you need to do to set up a rental property. Look for properties near amenities that people would want on vacation and once you find it, make it feel like home. “You’re painting a picture the same as you would if you were listing a house,” she said. Gibbons found she can use the vacation rental to build existing business relationships by offering it as a perk during the off season to valued clients. She has also donated cottage stays for non-profit fundraising events. “To me, it’s such a win-win. Personally there is joy to use it, professionally I can use it to make my clients happy and then financially it’s a nice business,” she said. QUICK TIP: When decorating a vacation rental, think about furnishings that will appeal to a wide audience, are sturdy enough to withstand multiple guests and are things you are OK with getting broken if something happens. Solicit reviews of your property and get professional photos taken to make your vacation rental look its best.

ILLINOIS REALTOR® January 2020

(Vacation rentals) are a great opportunity for people in real estate to expand their business and have fun.”

House flipping

For Nate Shields, a broker with eXp Realty, buying properties, rehabbing them and then flipping them to sell was a natural progression. After three years of selling real estate in the Sycamore-St. Charles area, Shields and a friend decided to move into investment rental properties, buying several single-family homes, a duplex and eventually a 20-unit apartment building. Shields decided the next thing he wanted to tackle was rehabbing homes for resale. His company, Invermore

– Judy Gibbons

Secondary business specialties of REALTORS® Percent of Respondents

14% Residential property management Relocations

14% 12%

Commercial brokerage Land development

Counseling

5% 3%

Commercial property management

International

Residential appraisal

Auction

Commercial appraisal Other

8% 0%

10%

15%

20%

Source: National Association of REALTORS® 2019 Member Profile

www.IllinoisRealtors.org

Enterprises, has flipped six homes so far, averaging one or two projects a year. Shields, who has extensive experience in real estate, has relocated to Wisconsin, but maintains his Illinois license to focus on his home-flipping business. “It’s been interesting and you just learn so many different aspects of real estate,” he said. You also learn what not to do, Shields says. His first flip was an extensive rehab project from nearly top to bottom and it was not without problems. Shields had to replace the contractor, but the experience left him more confident about getting what he wanted going forward. “The scariest part for me and for a lot of people is when you are doing a big rehab, especially if you are not in the trades and don’t know much about construction, is finding the contractor, making sure that you’re not getting ripped off, making sure that it’s quality work and it’s done on your timeline and on your budget,” he said. “It’s a big thing to take on and I think that’s why a lot of people don’t get started.” Transforming an outdated home is rewarding, but rehabbing is ultimately a money-making venture so Shields is always aware of the bottom line. “You have to think about who the end buyer is very carefully, so you know what to put money into,” he said. “Where a lot of flippers make mistakes is they put in the features they want to see and usually that’s going to be higher end. People are going to love it, but it’s not going to give you a good return on your money.” QUICK TIP: Determine your short- and long-term goals and work backwards from there. Find good contractors to work with if you aren’t doing the rehab work yourself, educate yourself on the investment market and if you don’t have a real estate investor networking group in your area, think about creating one.

Instructor, trainer

Sandra Workman, a broker with Keller Williams Preferred Realty in Bourbonnais, is a self-professed education junkie. Workman, ABR, BPOR, CNE, CNHS, CRS, e-PRO, GREEN, GRI, RCC, SFR, says she loves to learn all she can about the real estate industry and wants to share that knowledge with others to help enhance industry professionalism. “If you don’t educate yourself in this

Property management

In 2008, when Joe Castillo took over his parent’s real estate business, RE/MAX Mi Casa in Chicago, the Illinois housing market was in a downturn so he established a niche as an REO broker selling foreclosed properties. It was in that process of getting homes ready to sell that Castillo built contacts with different contractors, handymen, landscapers, plumbers and other tradesmen. As the market improved and the REO business slowed, Castillo looked for other ways he and his company could leverage the knowledge and contacts they had accumulated. “We had a knowledge base and a

business, this business will leave you behind,” she says. A REALTOR® for 15 years, Workman got her license to teach continuing education courses in 2016 after seeing a need in her area. Agents were having to travel closer to Chicago for classes or offices had to bring someone in to teach. “We needed someone here to teach agents about core competencies and keep everyone current on changes in the industry,” she said. She’s also become an MLS trainer for Midwest Real Estate Data LLC (MRED) and teaches agents as far away as Champaign, Bloomington and Clinton all while juggling the day-to-day demands of being a full-time REALTOR®. “It’s all in prioritizing, it’s in timeblocking,” said Workman, who is also a productivity coach for Keller Williams and does real estate photography in

her spare time. Family time gets blocked off first, then her real estate clients and then her classes. The teaching demands ebb and flow. Demand for her CE courses ramp up before license or Code of Ethics renewals. When CE slows down, she fills up her calendar with MRED trainings. Workman loves doing her part to improve the industry and the extra revenue she is bringing in from teaching is being set aside to help her realize her next goal: buying some investment properties.

network in place of tradesmen,” he said. “We learned how to manage other people’s properties and so there was a lot of skill sets that transfer from REO management to property management.” He looked around his south side neighborhood and saw that there wasn’t anyone really doing third-party property management. Most property managers were just working with rentals that they owned. Few were doing property management for someone else. So two years ago, Castillo and Oscar Campos, a broker in the office, added a property management division within his office to create systems to manage the rental properties owned by his company. Last year, after he felt like he had the proper software, employees and processes in place, he expanded and started adding third-party clients. Castillo looks at the property management side of his business as a good buffer to the ups and downs of the housing market. “If the market slows and things change, I think the property management

side of things will probably grow,” he said. “It’s a cash flow positive business, so a downturn in value doesn’t necessarily affect these properties or investors that much.” Long-term, Castillo sees another benefit to the property management side of his business. As he works with tenants, he builds relationships with renters who may someday become buyers and will hopefully come to him when they are ready to buy a home.

QUICK TIP: Teaching isn’t right for everyone. You have to have the right type of personality and mindset to do it because it can take up so much of your time. Try to learn something new every day.

QUICK TIP: Do your homework and don’t expect it to be easy. Castillo encourages people to start by having their own investment properties and managing those first to get a better understanding of the business. Then determine how much staff you need and build relationships with tradespeople who will prioritize your properties when the pipes freeze or some other problem needs to be fixed.

ILLINOIS REALTOR® January 2020

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ILLINOIS REALTORÂ® January 2020

Make the most of the winter doldrums Here’s what you can do now to keep your business on track during the slow season By Bridget McCrea When the slow season takes over the real estate market in Champaign, Max McComb does what any enterprising REALTOR® would: he plans a pizza party. But this isn’t just any pizza party, it’s one where his “family” of clients and contacts converge to enjoy a slice, drink a beer and reconnect. McComb hires a photographer

for the event, which won’t take place until the summer and – aside from being an overall fun time – it helps him generate multiple business referrals during the busy season. He varies the event’s theme and food every year, so two years ago he decided to take advantage of the “downtime” that the slow season afforded him. In January, he reserved

the space, planned the menu, hired the photographer and developed a list of invitees. “When you can get out in front of it and get all the pre-planning done in advance, all you have to do in June is follow through on what’s been put in place. All the work has been done.” says McComb, a REALTOR® with RE/MAX Realty Associates.

Here are more ideas ideas that will help you maximize seasonal or other market downtimes and ensure that you're ready to hop back to it when business normalizes: Tackle projects that fell off your agenda last year

This is a big one for Max McComb, who says he typically winds up with

numerous projects on the backburner after a busy year. Whether that means scrubbing your customer database, organizing your financial files (tax season is right around the corner!), or cleaning out your desk, these are all important tasks that will help you be

Pick up the phone and call your sphere Knowing that newer agents may be wringing their hands during the slow season, thinking that business may never pick back up to the way it once was, McComb tells them to hit their spheres of influence particularly hard right now. Work your database 22

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of past clients, reconnect with friends that you haven’t seen in a while, and talk to your family members about your real estate aspirations for 2020. Don’t come across too “salesy” during these interactions, he warns, but do make the point that you are an agent

more productive once business picks back up. “Downtime is a great time to catch up,” says McComb, who comes away feeling more organized after tackling a couple of those projects. “Just knowing some of those little things have been crossed off my list is a great motivator.”

who is looking for buyers and sellers to work with. “Just pick up the phone and make some calls,” says McComb. “Talk to them about what’s going on in their lives, and then remind them that you’re a real estate agent.”

Create a realistic business plan for the year ahead It’s easy to get overly ambitious with your business plan, only to get discouraged when you can only implement 10 percent of it, says Naja Morris, a broker at Naja Morris Real Estate in Chicago. Use the slow season to reassess last year's progress. Highlight what was or wasn’t implemented from your previous business plan and then come up with solid goals for the year ahead. “Use the winter to develop your plan of attack and to get ready for the spring market,” says Morris, who is using downtime to develop and launch a farming strategy for a specific neighborhood. “I’ve been number one in this neighborhood for the last four years, but I’ve never farmed it,” she says. “My 2020 plan includes doing some old-school farming, including knocking on doors and mailing out postcards in order to build my business in that area.”

Drop by your clients’ and prospects’ homes or offices

Fill up your listing pipeline with some gift giving

Work on your business (versus just in it).

There’s nothing like a hot cup of coffee or cocoa to warm your clients’ and prospects’ hearts during the cold winter months. Knowing this, Natalee Barracks-Dismuke uses the seasonal downtime to ramp up her “pop-by” strategy, which includes dropping by current, past and future clients’ homes or offices to say “hello” and deliver a warm drink or tasty treat. “It’s really easy to go out and buy a few boxes of Fannie Mae chocolates and drop them off at someone’s front door with your business card,” says Barracks-Dismuke, vice president of operations at Realty One Group Excel in Aurora. “Just ring the doorbell; it’s a nice surprise for your clients.” Don’t stop there, says Dismuke, who tells agents to keep making impromptu visits throughout the slow season. “Your hard work will pay off in the spring, when business returns to normal,” she said.

When Roxann Bohstedt’s listing pipeline dried up in late-2018, she knew how to get it back on track. It coincided with the holiday season and she knew how happy all of her past clients and contacts have been to get pies she handed out at Thanksgiving for the last 18 years. It was the perfect segue for Bohstedt to send a simple message: I’m out of listings and I need your help. “I took a light-hearted approach to it and wasn’t begging,” says Bohstedt, broker-owner at Your Home Team in O’Fallon, “but I’ll be darned if we didn’t get five new listings within six weeks.” With holidays around the corner, Bohstedt suggests other agents use a similar approach to “giving back” while also reminding their spheres how valuable referrals are to your business.

Busy with the day-to-day responsibilities of running their businesses, REALTORS® rarely get a chance to take a step back and assess their longer-term goals, challenges and opportunities. The slower season is a good time to take a breather and do exactly that, says Debbie Pawlowicz, a REALTOR® with RE/MAX Action in Lisle. “It’s a great time to work on your business instead of just in your business,” says Pawlowicz, who uses the time to earn new designations, update her listing presentation, polish her website and test out new software applications. This year, for example, her company is adopting a new customer relationship management program, and Pawlowicz is working with her team to learn how to use it before the spring selling season hits. “When business is brisk,” she adds, “there’s just no time to dig into a new educational opportunity or piece of software. That’s why we’re doing it now.”

Legal Note: Make sure the gifts are not considered something

of value – or compensation – in exchange for referrals.

Don’t forget to take some time for yourself It’s all too easy for REALTORS® to push themselves hard year-round and to take little or no time for themselves. The winter should also be a time for self-reflection and for spending time on your favorite activities and with your family and friends. “We have a granddaughter who we don’t get to see as often as we’d like to,” says McComb, “so we’ll carve out more time for weekend trips to go visit

the kids.” These trips—plus a little more time spent on his favorite hobbies and pastimes—reinvigorates this REALTOR® and reminds him of what’s most important in his life. “It’s fairly easy to stay motivated from a business standpoint when things are happening and deals are closing, but it’s also really easy to get worn out and run down,” McComb

warns. “By taking some time for yourself during the off months, you can avoid the ‘oh my gosh, I’ve done nothing fun for 12 months’ syndrome and come back refreshed and ready to jump in for the spring.” About the writer: Bridget McCrea is

a business, real estate and technology writer in Tampa, Fla. She can be reached at bridgetmc@earthlink.net ILLINOIS REALTOR® January 2020

Dale Taylor: Illinois’ Good Neighbor and advocate for the homeless By Jon Broadbooks, Vice President, Communications

REALTOR® Dale Taylor has spent nearly two decades helping the homeless through the South Suburban Public Action to Deliver Shelter (PADS) and is the site manager for one of the organization’s shelters for men. In November, Taylor was one of five REALTORS® nationwide honored with the National Association of REALTORS®’ (NAR) Good Neighbor Award. Illinois REALTORS® sat down with Taylor, a broker with RE/MAX 10 in New Lenox, at the NAR Conference in San Francisco to record a podcast about his tireless commitment to helping those in need. Here is an excerpt of some of that conversation.

Q: What prompted you to get involved with helping those who are homeless?

Taylor: It started with two phone calls from two close friends that I highly respect, and they came within five minutes of each other. They informed me the state of Illinois had given South Suburban PADS the former Tinley Park Mental Health Facility to house (Hurricane) Katrina survivors. They asked me if I would be willing to spend the weekend cleaning up the facility to welcome them, and so I did. I watched people come with no shoes on their feet because they were picked right off of their roofs and brought right to the Tinley Park Facility. I started that way, just giving a few hours once a month. Then I was asked for my resume and I said, “Why?” And they said, “Well, we think you would be a really great candidate to be a board member.” So I submitted my resume, and they asked me to serve on the board of directors. Then after that, the shelter manager approached me and she said, “Dale, I just acquired a new shelter and I’m really overloaded.

Dale Taylor talks about being a 2019 Good Neighbor during a ceremony at the REALTORS® Conference and Expo in San Francisco. PHOTO BY MATT DIFANIS

www.IllinoisRealtors.org

Would you help me to co-manage it? And I said, “Sure, no problem.” So after about six months, she said, “You know what? I think you’ve got this down pat. Why don’t you just take it and run with it?”

Q: Tell me about South Suburban PADS. How did it start, and how has it evolved over the years?

Taylor: It started with a group that coordinated about a dozen churches to provide emergency overnight shelter. As soon as they began to work on fundraising, they discovered there were foundations and entities willing to give grant money to address specific needs. They could actually hire caseworkers and social workers who could address the needs of the guests and get the funding to do that kind of work. And so it grew into a network of churches that provided emergency overnight shelter. No one church would be overloaded because they provide the brick and mortar and the utilities, and PADS provides the supplies and the volunteers. Then there’s the next level, because when those individuals who are experiencing homelessness are willing to meet with a social worker to determine exactly what their need is. It may be a health need. It may be just fine-tuning a resume or specific job training skill that might be needed to get them on the road of stability.

Q: Your day job is selling homes. Your job once a week is living among the homeless and serving them. How does this role of helping the homeless shape your view of what you do for a living, which is sell real estate?

Taylor: I find that when you’re experiencing homelessness, you really learn resilience because an individual

could just give up and commit suicide. But these individuals have learned to live under the radar. They’ve learned to survive and exist, and I learn something new from them all the time. One of the things I do is I establish very early that this is an environment of peace, and they are my extended families. A lot of times if I need to correct them I can do it with a look, or sometimes I just remind them that, “We are in God’s house, so I need you to behave yourselves.” Other times I just remind them that, “When you’re with me, it is all about our taking care of one another.”

Q: Now I don’t want people to think that your work at the shelter is a desk job, because it’s far from that. You mop floors, you clean. I’m just curious, what does a typical night look like for you when you do your Monday shift?

Taylor: It begins before a typical night because one of the things I do is build a team of volunteers who I ask if you could give me one Monday a month, for three to four hours. That way you could put it in your calendar, and you know every first Monday you’re at the shelter. I try to get the food teams to provide volunteers for the overnight shifts. One of the challenges is just overnights. It’s very hard to get people to commit to that, especially if they work a day job. That requires me to make that commitment, to make sure that there is a responsible person there watching over everyone. When the weather is decent, we might have 23 guests. But as it gets colder, we can accommodate as many as about 40. I would say we average probably about 35. How does this help me with real estate? Just the fact that I give respect to these individuals and I

let them know that they’re valued. They never ever feel that they are a problem. I make them know that they’re cared for, and all of that falls into the arena of customer service. It just helps me to finetune my customer service skills through serving that population.

Taylor is congratulated by former NAR Presidents Martin Edwards Jr. and Ron Phipps. PHOTO BY MATT DIFANIS

Q: It’s clear that you see this outreach really is about building relationships. And as you put it, it seemed truly natural for somebody who is a REALTOR®.

Taylor: We’re in the serving business, and also we’re in the sowing and reaping business. When people focus on prospecting for new business, that’s a form of sowing. When you’re serving a client and, you serve them well and you help them to achieve their goal, that’s a form of sowing. The reaping is the commissions that you earn and the referrals that may be generated by serving a client very well. And likewise, in serving the less fortunate. When I’m working with my clients, I will share with them, “I may never fully prepare you for the experience of buying or selling real estate. It is a step-by-step process. But the one thing that you will know is that I’m going to be right there with you through every step to guide you. And whatever you’re going to go through, I’m going to be right there going through it with you.” When people know that you have that level of caring for them, it produces such a great harvest.

Want to hear more about Taylor? Listen to the full interview with Taylor and get the full transctipt at bit.ly/ Taylor_Interview

ILLINOIS REALTOR® January 2020

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Illinois Young Professionals Network www.IllinoisRealtors.org/YPN

DON’T BE A WALLFLOWER

YPN members share strategies for better networking By Ann Londrigan, Vice President of Member & Association Engagement

We’ve all been there. At a networking event, it’s easier to hang back on the edges of the crowd and be a “wallflower” than walk up to a group of people you don’t know to start a conversation. Networking, however, is an important skill to develop and strategy to use to grow your real estate business, according a recent member survey of the Illinois REALTORS® Young Professionals Network (YPN). So, what are some strategies for getting off the wall?

“I’ve done my fair share of wall-sitting,” admits Connie Vavra with RE/MAX Professionals, Bolingbrook. “However, that is not why you came to the event. It’s not why you drove one-anda-half hours in traffic and spent money on a ticket to attend the event.” “My advice?” says Vavra.

“Meet three new people at every event and you will know you did something right.”

Like the wallflower syndrome, it’s also easier to hang with those you already know. But that’s not how to grow your business through networking. Brian Kwilosz with Exit Real Estate Partners in Downers Grove, teaches his agents to read the crowd. “Don’t ignore the people you already know. Say ‘Hi’ but then move on,” says Kwilosz. “The point is to

meet new people. So, learn how to read a room.” “If you have two people in conversation and they are close and facing each other directly, it will probably be harder to break into that," says Kwilosz. "Whereas if they are angled out a bit more, that’s more of an open invitation for you to join that group.”

ILLINOIS REALTOR® January 2020

Four tricks for remembering names

According to Dale Carnegie’s classic best-seller How to Win Friends & Influence People, saying a person’s name is the sweetest and most important sound to the person you’re talking with. Here are some techniques for remembering names from members reached in the Illinois YPN survey on networking for business.

“I associate names with actors or colors.” – Natalee BarracksDismuke, Realty One Group Excel, Aurora

“I always ask for a phone number and I also ask for their Facebook info so I can add them to my real estate page. This way I can view their profile and once I have connected in that fashion I tend to remember. I also keep good notes in my CRM.” – David Bovyn, Exit Real Estate Partners, Downers Grove

www.IllinoisRealtors.org

“If you have a second party with you and they give their name, the person will give their name. Otherwise I just keep saying the name with the face until it sits in my head.” – Eddie Ruettiger, Baird & Warner, Plainfield

“I have to repeat their name out loud as I shake their hand otherwise my mind goes blank. Using their name throughout the conversation helps reinforce it.” – Christine Coleman, Coleman Land Company, St. Charles

Now that you’ve made your way in, what’s a good conversation starter?

From the survey, several said make the conversation about the person you’re talking with. People like to talk about themselves. Some basic principles of the

Dale Carnegie classic How to Win Friends & Influence People include encouraging people to talk about themselves, being a good listener and showing sincere interest in their interests. The F.O.R.D. method is a technique used by Eddie Ruettiger with Baird & Warner, Plainfield. Ask about their family, their occupation, what they like to do for relaxation and what are their dreams. Examples of dream questions include “What have you always wanted to do?” and “If you could travel anywhere, what place would you visit?”

“I always ask potential clients ‘What do you do?’ as this almost always ends with the question ‘What do you do?’ from them,” says David Bovyn with Exit Real Estate Partners, Downers Grove. “So I now have my in to talk real estate. Bovyn adds: “As far as peer networking, I like to ask personal questions to get to know someone rather than just business. Where are you from? Are you from here originally? What’s your favorite band?” Vavra’s networking strategy focuses on building her referral base through peer-to-peer networking at REALTOR® events. There she uses the conversation starters related to the latest business tool, app or program they are using in their market. Vavra says, “I also tend to ask what challenges and successes they face in their business. This question works for REALTOR® events or anyone new you are meeting. People are surprised by the question. I think they are waiting for the typical comment about the weather or a sports team.” Jayme Ahlden Fay with RE/MAX Realty Associates in Champaign, wears a pair of attention-

getting shoes. For her, it’s custombranded “Chucks,” the shoe popularized by basketball star Chuck Taylor in the 1920s. Says Fay: “I will often wear those to networking events as they are a natural conversation starter.” Instead of the predictable “What company are you with?” or “Where are you located?” questions, Gibby Kirby with Realty Executives Success in Shorewood, uses kindness. “A genuine compliment can be one of the best ways to create a personal connection and to then get the

conversation going in a less business-like fashion,” says Kirby. Now that you’ve finally got into the conversation, how do you get out of it? After all, you’ve met at least one or two new people, but the goal you set for the networking event was three. Time to move on. “Saying ‘excuse me’ is still important,” says Kwilosz. “What we learn growing up about being polite and saying ‘excuse me’ is a great way to break into a conversation and, just as importantly, a great way to get out of a conversation.” Kwilosz adds: “I’ve been there, our seasoned networkers have all been there where you get into a conversation with a couple people and you’ll be there forever. You need to be able to break away from that but in a polite way.”

Learn more tips for success in your real estate career by tuning into Illinois REALTORS® YPN podcast episodes.

Visit www.IllinoisRealtors.org/YPN on the Illinois REALTORS® website and connect with us on Facebook @IllinoisYPN. Listen to the networking episode of the Illinois YPN podcast for tactics to move you from wallflower to conversationalist.

Four common networking mistakes?

“When you turn it into a card giveaway. Networking is about exchanging value. Some people try to make it a sell without even building a positive conversation.” – Rasheed Shofidiya, Kale Realty, Chicago

“Spending too much time with one person or group. Sometimes at networking events I will find myself meeting new people but staying with them for a while rather than breaking off to meet other people. I think it would be more beneficial to know when to find a good end to the conversation so that I can make other relationships too." – Megan Beechen, Realty Executives Elite, Lemont

“Sometimes people come to networking events trying to sell something when in turn they don’t want to be sold to. Make a personal connection if you can, maybe you support each other’s businesses in some way.” – Jayme Ahlden Fay, RE/MAX Realty Associates, Champaign

“I think one of the biggest mistakes is to think that every interaction should be used solely as a chance to make a referral source. No one really likes to feel they are being ‘sold’ to, especially salespeople. It’s better to go in with a desire to make a genuine connection.” – Gibby Kirby, Realty Executives Success, Shorewood

ILLINOIS REALTOR® January 2020

MARKET WATCH What’s ahead for housing in 2020? By Stephanie Sievers, Senior Editor

Dr. Geoffrey J.D. Hewings,

Emeritus Director of the Regional Economics Applications Laboratory at the University of Illinois, Urbana-Champaign

The Illinois housing market in 2019 was at times mixed, with fairly steady home prices but more irregularity when it came to home sales trends. Illinois REALTOR® talked to Geoffrey J.D. Hewings, emeritus director of the Regional Economics Applications Laboratory at the University of Illinois, about the economic factors to watch in 2020 and his forecast for the Illinois housing market. Q. In 2019, home prices experienced steady gains but home sales often fluctuated. What were some of the economic factors that affected the housing market in 2019? The major source of uncertainty can be traced to (1) forecasts of an imminent recession and (2) the continuing tariff conflicts between the U.S. and China and U.S. and the European Union. The impact has been felt primarily in the agriculture and manufacturing sectors, although many service sectors have been affected. This

Source: University of Illinois REAL, Illinois REALTORS®

www.IllinoisRealtors.org

uncertainty has dampened housing demand, especially in the second half of the year, and has not countered the strong, positive attractions of lower interest rates. Q. How much of an issue has low inventory been on market growth? Apart from the economy, low inventory has been a continuing problem in the last six years, especially in the lower-price ranges. However, prospective buyers across all price ranges have commented that the limited inventory has deterred them from purchasing a home. Q. What are you forecasting in terms of home sales and prices in 2020? We are forecasting continued median price growth in both Illinois and the Chicago Metro Area with a slightly greater month-to-month range in Illinois than the Chicago area. By December 2020, we anticipate median prices to reach $207,409 in Illinois and $243,533 in the Chicago Metro Area. For sales, the picture is mixed. Illinois is forecast to experience negative gains (year-over-year) for most months in Illinois. On the other hand, in the Chicago Metro Area most months will see positive year-over-year gains. If mortgage rates remain low, there could be a “bump” in sales. Q. What are some of the key economic trends to watch for in the new year? The national election will continue to dominate the news cycle, closely followed by progress, or the lack thereof, in key tariff negotiations. Slowing growth in China and Europe

will have both direct and indirect repercussions on growth in Illinois. Chicago’s employment growth has been positive, but lags behind other major metropolitan regions although it is in line with trends in the Midwest as a whole. Q. In recent years, the state budget and other government issues have negatively affected the Illinois housing market. Is that still the case? The issues now center on fiscal management, especially finding ways to reduce the unfunded pension deficits and the accumulating current account deficits. Close attention will be paid to the vote on a graduated income tax for Illinois, the additional revenue from which undergirds a lot of the proposed capital spending in the state. Q. You’ve talked in the past about the outmigration of people leaving Illinois and its impact on housing. Has anything blunted that outmigration or is it expected to continue? How will it continue to affect home sales and values? Outmigration will continue. The challenge is to convince the market that the state’s fiscal challenges are being addressed and that additional tax revenues will be allocated strategically between debt repayment and funding infrastructure maintenance and replacement. Those improvements would make the state attractive for

Source: University of Illinois REAL, Illinois REALTORS®

new businesses to locate and for existing businesses to expand. With these responses, job growth (and in-migration) will be muted with a corresponding dampening effect on the housing market. Q. Finally, how much of a factor are foreclosures on the market right now? The share of foreclosure sales in total monthly home sales has dropped significantly over the past two years. For example, in October 2019, they accounted for less than 8 percent of total sales. The foreclosure inventory, however, has been growing over the last year, and we are monitoring this trend carefully. Given the lengthy legal process involved in processing foreclosed properties, the inventory growth may reflect market conditions of some years ago. Further, in some months, the prices of foreclosed sales have been growing faster than prices of regular sales so that the effect of overall median prices has not been negative.

Find the complete 2020 housing forecast at: www.IllinoisRealtors.org/Marketstats

The mixed signals from the market are reflected in a housing market that remains positive in terms of prices, but with considerable variance in terms of sales. Affordability and limited inventory dampen demand while low interest rates make ownership attractive; the net effect of these forces is reflected in a market that is difficult to forecast.”

– Dr. Geoffrey J.D. Hewings

ILLINOIS REALTOR® January 2020

REALTOR® advocacy around Illinois In addition to helping educate state legislators on the dangers of enacting Rent Control policies, Local Governmental Affairs Directors (GADs) have been working hard on a variety of local issues.

Here are highlights from the last four months:

REALTORS® in Chicago continue to oppose an increase in the city’s real estate transfer tax. Recent versions of an increase contain graduated rates based on the value of the property being transferred. Rates would increase (above the current rate of $7.50 per thousand) to higher rates for properties over $500,000. REALTORS® voiced opposition to a Home Rule referendum in Burr Ridge. If this measure goes to voters in the March Primary, voter outreach will be done to urge opposition. In Southern Illinois, REALTORS® worked to streamline property inspection programs by making inspection checklists less cumbersome, lengthy and costly. (Recent action took place in Belleville, Swansea and Greenville on this issue.) In the village of Tremont, a residential fire sprinkler installation mandate for new homes was blocked. Instead, a voluntary policy was adopted whereby prospective buyers are informed of the option of sprinklers. (Similar policies currently exist in Bloomington and Normal.) The city of Elgin considered removing an incentive provision in its rental licensing ordinance. The incentive is a two-year grace period when properties pass inspection. REALTORS® voiced objection to this, and the city

www.IllinoisRealtors.org

decided to keep the provision. A Springfield proposal to license landlords was stalled due to REALTOR® efforts. City officials ultimately agreed with REALTORS® that the focus should be on stronger enforcement of the city’s existing chronic nuisance property ordinance. Efforts by Peoria REALTORS® led to key changes to a foreclosed property registration ordinance. Any fee that is assessed will only be on the foreclosing entity (and not the occupant on the property). Also, preforeclosures will be excluded from this registration process. Several GADS are battling proposals throughout the state that include exorbitant vacant property registration fees. REALTORS® successfully advocated against a property tax levy increase in Normal. The village of Richmond extended its school impact fee moratorium for an additional three years. The city council is also considering a reduction in building permit fees to assist in the attraction of new construction due to testimony provided by REALTORS® and home builders. The village of Beecher also reduced its impact fees significantly— from $14,000 to $1,500. The village of Fox River Grove passed a resolution adopting a Property Assessed Clean Energy (PACE) Program. This will help promote financially affordable clean energy solutions for commercial properties. The city of Waukegan requires a closing letter prior to the sale of any property. The burdensome process often leads to delayed closings. City

officials have committed to working with REALTORS® to make significant changes that will lead to an easier, more streamlined process. In Naperville, NAR REALTOR® Party resources were used to gauge public opinion on affordable housing policy options. Galesburg’s Landlord Licensure Ordinance is currently under review—in large part because REALTORS® argued it is not effective. Libertyville officials began discussing Home Rule referendum options in the fall. Thanks to REALTOR®-initiated efforts, the village board changed course and recently approved a non-Home Rules sales tax referendum, which will be on the March 2020 ballot. The city of Geneva was considering a burdensome “inclusionary housing” ordinance with mandatory set-asides of affordable units in new developments. After REALTOR® input, the city approved an optional ordinance with specifically tailored incentives to encourage developers to build housing at a below-market rate.

Mike Scobey

Senior Director of Local Advocacy & Global Programs

ILLINOIS REALTORÂ® January 2020

OUTREACH Your office may be on the map By Gideon Blustein

Each dot on this map represents an office visit by a member of the Illinois REALTORS® Member Outreach Team in 2019. Thank you to the hundreds of managing brokers and thousands of REALTORS ® who invited us into your offices! The Member Outreach program was created in 2015 to serve as “boots on the ground” in every corner of the state to connect Illinois REALTOR® members with the services and benefits paid for with their dues. We cover REALTOR® advocacy, especially issues popping up at the local level, while also answering questions and connecting members with other key resources.

Joe Roth

Local Governmental Affairs Director NSBAR and Lake County

Neeley Erickson

Local Governmental Affairs Director Northwest

Popular member resources: • 2020 Broker License Renewal Chart prepared by the Illinois REALTORS® Licensing & Training Center

• RELA Rewrite web page www.IllinoisRealtors.org/RELA_Rewrite • Inman News real estate news subscription

What were the hot topics in 2019? • Rent Control

• Real Estate License Act Rewrite • 2020 Illinois broker license renewal • Cook County “Just Housing Ordinanceˮ

www.IllinoisRealtors.org

Ron Deedrick

Local Governmental Affairs Director Southern