The opinions expressed by nonstaff contributors may not reflect the official opinion of Maryland REALTORS® and/or policies derived from leadership and staff.
Mission Statement
Maryland REALTORS® exists to support all segments of its membership and their specialties. Maryland 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, Maryland REALTORS® values and seeks diversity and inclusive participation within the field of real estate and recognizes each member as a unique individual.
Being an Advocate for our Clients
For me, one of the most personally rewarding things about being a REALTOR® is helping people and families find their dream home. Going to settlement, giving them their keys, and seeing the look of happiness and joy when they finally realize that this home is theirs—it doesn’t get any better than that. We are problem solvers. We are the ones who carry the client through the process to get them from Point A to Point Home. And as REALTORS®, we are bound by a strict code of ethics. The REALTOR® Code of Ethics gets us into the habit of doing what’s right, and it ultimately helps our clients even when things are not within our control.
Appraisal bias is a good example. While this topic has been in the news, it remains a very important component of the entire process.
As REALTORS®, we must not interfere with the appraisal process. The relationship between lender, appraiser, and client— who generally pays for the appraisal— is separate from our role as REALTOR®.
With very few exceptions, we are not appraisers.
Kathleen Dartez, our Director of Legal Affairs, has written an excellent article in this issue about appraisal bias and what REALTORS® must know. As REALTORS®, we must not interfere with the appraisal process. The relationship between lender, appraiser, and client—who generally pays for the appraisal—is separate from our role as REALTOR®.
While we don’t get involved in the appraisal process, we may hear from our clients about all aspects of the homebuying and selling process. While everyone involved wants everything to proceed smoothly, that is not always the case. Kathleen’s article includes a good list of resources that a client can avail themselves of if they are not satisfied with the appraisal process.
This issue also includes six emerging trends in Commercial Real Estate—just in time for INNOVATE 2023, the Maryland REALTORS® Commercial Symposium, which will take place Thursday, May 4 (visit www.mdrealtor.org/ Innovate-2023 to register) at the Maryland Live! Casino & Hotel. This year, we have an amazing line-up including Maryland’s new Secretary of Commerce, Kevin Anderson. And, back by popular demand, our Deal Exchange & Happy Hour will once again make its return.
Within this issue, we also invite you to volunteer for Maryland REALTORS®’ committees. Your participation and engagement are the fuel that gives this association momentum, and by channeling your passion into service on one of 21 committees, you will help advance the association in many valuable ways. Our President-Elect Chris Hill has written about the importance of volunteering. Read his thoughts on page 18, and then consider volunteering by visiting www.mdrealtor.org/volunteer and signing up for your preferred committees.
We had a record number of volunteers sign up last year, and we look forward to that same enthusiasm moving forward.
Thank you for all you do. ■
Muckle Is Maryland REALTORS®’ 2023 President.
Yolanda
We’re Celebrating DEI!
We’re excited to announce Maryland REALTORS®’ NEW Diversity, Equity, and Inclusion Leadership Award!
We’re celebrating the incredible work our REALTOR® community is doing to drive an improved culture within the workplace and in the communities we serve. This award is designed to recognize those who have made significant steps towards creating a more diverse and inclusive community through the implementation of initiatives and/or programs reflective of Maryland REALTORS®.
The Leadership Award is open to any Maryland REALTORS® member, real
BIG Events!
Pride in Practice: June 6, 2023
Merriweather Lakehouse Hotel, Columbia, MD
Join us for our second annual Pride in Practice event—an event dedicated to advancing the association’s and members’ efforts to engage and educate our diverse membership on the importance of Diversity, Equity and Inclusion. This year’s program is designed to elevate and maintain the high standards of professional conduct with all members by raising awareness of the issues faced by LGBTQ+ homebuyers and renters. To find out more follow this QR Code and register today!
estate firm, or local board/association and their staff, as long as they meet two of the following criteria:
■ Demonstrates emerging or sustaining commitment to the values of DEI by documented efforts that are above and beyond routine expectations.
■ Exhibits exceptional efforts to promote a working environment that is free from bias and discrimination.
■ Raises and deepens awareness of equity, inclusion, and diversity issues.
Maryland Homeownership Expo: June
17
Wayne K. Curry Sports & Learning Center, Greater Landover, MD
Breaking News! Maryland REALTORS® is now partnering with the Prince George’s County Housing Authority to bring to consumers and REALTORS® a homeownership event that will cultivate a new generation of homeowners and those who have been challenged finding a home in this market. This will be a consumer and REALTOR® event as we link this to NAR’s “Riding with the Brand” program. There will be programming for consumers and REALTORS® along with exhibitor opportunities. Follow the QR code for more information!
■ Recruits and retains an excellent, diverse pool of Maryland REALTOR® members for volunteer positions.
■ Makes outstanding contribution(s) to communities in furtherance of DEI mission through education and outreach.
To nominate an amazing organization or person, follow this QR code for the application and requirements.
ALL IN! Engage. Network. Learn.
September 19–21, 2023
Maryland Live! Casino & Hotel, Hanover, MD
We’re ALL IN for our next Annual Conference, are you? We’re busy at work on our next Annual Conference, ALL IN!, to be held at Maryland Live! Casino & Hotel. Sponsors and exhibitors: to find out how you can play a role in ALL IN!, please email Angel Brandt at angel.brandt@mdrealtor.org. ■
The CIPS Designation has positioned me to bring global investment opportunities to my clients as well as awareness to my fellow colleagues about this important niche market. After attending the first Maryland-offered Africa and International Real Estate course, I realized that ‘Emerging Countries’ is what I need to focus on as I continue to grow my global business. I’m now offering virtual webinars on investment opportunities outside of the US to my clients.
– ERICA L. SOLOMON Certified International Property Specialist
Six Trends in Commercial Real Estate
Welcome to the brave new world of commercial space reinvention.
BY HEDY NELSON, ESQ.
“In my experience, in the real estate business past success stories are generally not applicable to new situations. We must continually reinvent ourselves, responding to changing times with innovative new business models.” –Akira Mori, real estate developer
Our world has certainly changed over the last few years. It should come as no surprise that the factors affecting so many of those changes have affected our use of commercial real estate. COVID-19, the war in Ukraine, and climate change have resulted in many of the challenges we face today: supply chain issues, inflation, interest rate hikes, commercial property vacancies, and global warming.
This article explores six notable trends emerging in today’s commercial real estate industry.
1. FLIGHT TO AMENITY-RICH OFFICE SPACE
Last year, the National Bureau of Economic Research predicted that the remote work/hybrid work trend will have resulted in 30% remote workdays by the end of 2022. By all accounts, these remote/hybrid models are here to stay. Companies need less office space, resulting
What amenities will you find in tomorrow’s office space?
in high office vacancy rates. High vacancy rates lead to more competition among landlords to attract tenants. At the same time, companies want to incentivize employees to come into the office. They seek newer office space offering many amenities to provide attractive environments for their employees.
According to Fooda, a workplace food company, the ten most important office amenities are:
1. Conference facilities
2. Reliable, fast wi-fi
3. Parking and public transportation accessibility
4. Dining options
5. Fully equipped fitness centers
6. Outdoor space, such as balconies and rooftops
7. Eco-friendly options, such as secure bicycle facilities, green certified offices, large windows, electric vehicle charging stations
8. Security measures
9. Tenant lounge
10. Convenient retail options
Other desirable amenities include on-site childcare, mothers’ rooms, doggy daycare, podcast studios, game rooms, and separate coffee and beer bars.
With office vacancies not expected to decrease significantly anytime soon and a severe shortage in affordable housing, adaptive reuse has become popular solution. Adaptive reuse is the process of converting an underutilized commercial property into a different type of commercial property to allow for its best use. The most popular type of adaptive reuse is currently the conversion of office buildings into affordable housing, making up more than 40% of all conversions in 2020 and 2021. According to Rentcafe, a real estate research and analysis firm, its December 2022 market insights noted that adaptive reuse apartments were up by 25% in 2020 and 2021 compared to the pre-pandemic period. New apartment construction increased only 10% during that time.
Washington, D.C., Philadelphia, and Chicago had the most adaptive reuse conversions between 2020-2021, comprising 15% of the total apartment conversions nationwide. Los Angeles now leads conversions, according to The New York Times.
Hotels, industrial buildings, schools, and religious facilities were among other types of buildings converted into housing and other uses. According to the National Association of REALTORS® (NAR), churches have been turned into art centers, factories have become became microbrew pubs, and shopping malls have been transformed into medical facilities.
3. COWORKING/ FLEX SPACE
With the popularity of the hybrid work model, companies need less space, while also needing flexibility. To make their space more affordable, many companies find that on-demand space solutions work well, such as renting a conference room for a couple of hours once a month to hold sales meetings.
Landlords are including coworking spaces in their leasing strategies. According to CommercialEdge data, one example is WeWork’s new 60,000-square-foot coworking space in The Wilson, a 23-story office building in Bethesda, owned by Carr Properties. The new coworking space includes dedicated desks, individual suites, meeting rooms, space for individual workers and bigger teams. Members have access to classroom spaces, an outdoor plaza, a fitness center, a multipurpose rooftop, bike storage, a lounge, and a mother’s
Can adaptive reuse breathe life into oncethriving malls?
and attractive.
room. It is within walking distance of popular shopping and dining options.
Companies such as WeWork, Regus, and Yardi/ CoworkingCafe.com offer platforms to help landlords operate their coworking space. Services may include booking, handling payments, management of inventory, marketing and pricing, accounting, operations, and customer contracts to make the experience as seamless as possible for landlords and tenants.
4. BRICK AND MORTAR NEIGHBORHOOD STORES
Costar reports that the retail sector in the Baltimore market is expected to remain strong and perform better than pre-pandemic levels. However, the recent rise in interest rates has begun to slow deal-making in the retail sector. Of the deals that closed, grocery-anchored centers ultimately drove volume.
CoStar predicts that growth in the brick-and-mortar stores will be driven mainly by smaller shops, such as neighborhood centers. As a result of the hybrid work model, workers are spending more time in their neighborhoods. In addition, with fewer commute days, employees are moving out of the cities and into the suburbs. As a result, they are enjoying the convenience
and personal interaction of shopping more in their neighborhoods.
In addition, despite the increased popularity of online shopping since the pandemic, consumers still enjoy in-person shopping. According to Digital Commerce 360, in 2021, “offline sales accounted for more than three-quarters, or nearly 81%, of the overall gains in retail spending . . .” Numerous retailers that have previously operated solely online now have brick-andmortar stores in their plans. Examples include Untuckit, Allbirds, Boll & Branch, Casper, and Wayfair.
5. Environmental, Social and Governance (ESG) Trends
We see companies shifting towards incorporating environmental, social, and governance (ESG) considerations into their business strategies for several reasons.
First, it increases positive brand awareness. Companies have taken notice that more consumers today consider a company’s environmental and social practices when making purchasing decisions. A February 21, 2023, article in The Business News Daily cites the Kantar Purpose 2020 study, which showed that companies that the public considers highly impactful demonstrated a brand value growth of 175% over 12 years, while businesses with a low positive impact showed only 70% growth.
Second, the ESG approach helped companies attract employees. According to Deloitte’s 2021 Millennial and Gen Z Survey, the modern workforce prioritizes culture, diversity, and high impact over financial benefits. Their personal ethics strongly influence their decisions on what companies to join. In addition, they are significantly more likely to stay with employers who share their social values. The estimated cost of losing an employee averages 40% of their annual salary, according to a report by the Washington Center for Equitable Growth. That gives employers a financial incentive to adopt socially responsible strategies that match those of the employees they are trying to attract.
Third, as institutional investors have begun to commit at least portions of their portfolios to more socially conscious investments, more capital is becoming available for sustainable strategies. According to a September 2021 Charles Schwab report, ESG funds have consistently ranked around the middle of their
Coworking and Flex Space options can make office space more affordable
peer groups in performance. The Schwab report notes that “[if] you look out ten years into the future, there may be a lot of risk in owning assets that don’t meet sustainability targets. Those assets may suffer from less tenant demand, higher operating costs, and increased regulations. The cost of capital for those assets is likely to be relatively higher.”
6. CROWDFUNDING
Investopedia defines crowdfunding as “[t]he use of small amounts of capital from a large number of individuals to finance a new business venture.” Crowdfunding uses social media and crowdfunding websites to expand the pool of investors beyond the traditional circle of owners, relatives, and venture capitalists.” For real estate, investors can commit far lower amounts of capital than they would if they purchased property on their own (even as low as $10), and do not have responsibility for operating the property.
The Jumpstart Our Business Startups (JOBS) Act of 2012 and the 2015 adoption of Regulation Crowdfunding made it easier to raise funds through crowdfunding. The past 18 months have seen the most growth in crowdfunding, though. Investment rules still apply, as do limitations imposed by individual crowdfunding platforms. For most crowdfunding projects, investors need to be “accredited investors.” That means they need to be financially sophisticated and meet certain wealth and income thresholds. Other rules include requiring transactions to take place online through an SEC-registered intermediary, limitations on the amount of capital that can be raised, disclosure requirements, and restrictions on the sale of securities purchased in a crowdfunding transaction. Crowdfunding platforms include Crowdstreet, RealtyMogul, Yieldstreet and Fundrise. ■
Hedy Nelson, Esq. , is the broker of record for Witz Realty and a member of Maryland REALTORS®’ Commercial Alliance Committee.
Are you ready to innovate in commercial real estate? Register today for Maryland REALTORS®’ annual one-day commercial symposium, INNOVATE 2023, to be held May 4 at the Maryland Live! Casino & Hotel.
At this year’s gathering, attendees can learn first-hand the future of Maryland business from Kevin Anderson, Maryland Secretary of Commerce. This year’s symposium will also take a deep dive into global logistics and the supply chain from a CRE perspective.
And, of course, INNOVATE 2023 would not be complete with its deal exchange and happy hour, where attendees can discuss select commercial projects, while also networking with colleagues.
If you’re a CRE professional or looking into it to expand your business portfolio, you will want to attend INNOVATE 2023. Scan this QR Code for more information and to register. Want a larger presence? Sponsorship opportunities are available.
Recognizing Commercial Excellence
New in 2023: Maryland REALTORS® will celebrate excellence with the Commercial Excellence Award. There are three awards—the Maryland REALTOR® Spirit award, Service Activity award, and Commercial Business Accomplishments award—and the deadline to apply is April 14, 2023.
Follow the QR Code for more details and to download the application. We look forward to celebrating your achievements!
Appraisal Bias
What REALTORS® Need to Know
BY KATHLEEN DARTEZ, ESQ.
It is essential that REALTORS® understand the scope and impact of potential appraisal bias to allow us to help our clients navigate this critical phase in the homebuying process.
What steps can we take to provide relevant information to an appraiser to increase the likelihood of an accurate valuation? How can we support our clients who believe the valuation of their home is “off?” What options are available to our clients in response to allegedly discriminatory, biased, or negligently prepared appraisals? Let’s walk through the process.
An appraisal is an independent opinion of value, performed by an appraiser for a lender in connection with a loan secured by real property. Although the consumer pays for the appraisal, the lender who will be financing the transaction typically orders the appraisal and is the appraiser’s client. The buyer will receive a copy of the appraisal. Remember that the appraiser must comply with the Uniform Standards of Appraisal Practice (USPAP), as well as any additional requirements imposed by the lender, investor, or guarantor.
The accuracy of an appraisal can be impacted by a variety of factors, including the appraiser’s familiarity with the area, the comparable property sales selected by the appraiser, information regarding the subject property and any amenities, upgrades or improvements, and information about the neighborhood. REALTORS® can play an important role in making sure the appraiser has current, accurate, and relevant property information. It is permissible for a REALTOR® to share information about the property with the appraiser prior to the appraisal. You may provide a CMA with information explaining why you selected those properties. You may provide a copy of the Contract of Sale, together with information about the neighborhood, such as the streets constituting the boundaries of that neighborhood. You may provide information about any features, improvements, or enhancements to the property, including plumbing, electrical, or any “green” features which may not be visible to the appraiser. You may choose to create a package of information and leave it at the property for the appraiser.
You may also meet with the appraiser at the property. You may not, however, interfere with the appraisal, or attempt to coerce or threaten the appraiser in any way. You may present or share any information that you have with the appraiser, be available to answer any questions the appraiser may have, and then you should step aside to allow the appraiser to do what they were hired to do.
Another factor impacting the integrity of an appraisal is the appraiser’s competence. “Competence” isn’t limited to whether the appraiser made a mistake regarding the property condition, or if they should have selected different comparable properties. The appraiser should have experience appraising that particular property type and that geographic area. It is permissible for a REALTOR® to ask whether the appraiser has experience in that geographic area. Appraisers are subject to a code of ethics to determine that they are competent to perform the appraisal. If they are not, they are required to disclose this and either withdraw from performing the appraisal—or they must document how they will become competent. A best practice, for this and every other phase of the transaction, is to document any communications with the appraiser and to retain copies of any information shared with the appraiser.
Everything discussed above would occur before the appraisal is performed. What options are available to your client if, despite your best efforts, the appraiser made a mistake, and the appraisal isn’t accurate? You are probably aware that it is possible for the homeowner or borrower to contact the lender to request a Reconsideration of Value (ROV). A request for an ROV is appropriate if the appraisal contains factual or other errors or omissions, inadequate comparable properties, or if there is evidence that the appraisal was influenced by prohibited bias.
On its website, the Consumer Financial Protection Board (CFPB) explains the ROV process as follows:
Responsible lenders focused on serving their customers typically will provide borrowers with clear, actionable information about how to raise concerns about the accuracy of an appraisal. A lender’s reconsideration of value process must ensure that all borrowers have an opportunity to explain why they believe that a valuation is inaccurate and the benefit of a reconsideration to
continued on page 12
Appraisal Bias: System Issue or Our Issue?
BY CLEVELAND HORTON
Research has shown that appraisal bias continues to have a lasting negative impact on minority communities throughout our country. Whether we are discussing more training for appraisers, the entire appraisal process, or the negative impacts of biased appraisals, the data tells a compelling narrative. Historically, access to a host of services related to homeownership has not been equitably available to people of color, and it continues to impact the racial wealth gap. For example, the median White family holds eight times the wealth of the typical Black family and five times the wealth of the typical Latino family.
According to a Brookings Institute report (2022), homes in Black neighborhoods are valued at roughly 21 to 23% below what their valuations would be in other non-Black neighborhoods. The report concludes, using the same model, that neighborhoods with a majority of Latino or Hispanic, Asian American, or White residents do not experience home price devaluation at a comparable level. What is the impact of this devaluation, you may ask? The report indicates that the cost of devaluation across 113 metro areas in the U.S., with at least one majority-Black neighborhood, is approximately $162 billion.
Data from Freddie Mac (2021) finds that 12.5% of appraisals from home purchases in majority-Black neighborhoods and 15.4% in majority-Latino neighborhoods result in a value below the contract price, compared to only 7.4% of appraisals in predominantly White neighborhoods. As a result of an appraisal below the contract price, buyers are faced with potentially higher down payments, contracts being voided, and a reduction in the seller’s financial gain. This can have a direct impact on the seller’s ability to purchase their next home. In addition to the impact on individual buyers and sellers, systemic undervaluation in communities of color impacts the entire community. An undervalued home now becomes a likely comparable property in other transactions in the same community and has the significant potential to carry the effect of the undervaluation forward.
Recently, there have been some efforts to address and minimize the impact of appraisal bias. In 2021, President Biden launched an interagency initiative to investigate bias in home appraisals. This initiative resulted in the creation
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determine whether an adjustment is appropriate. While an individual lender’s reconsideration of valuation process may vary, lenders must make sure that their reconsideration of value process is nondiscriminatory and available and accessible to all.
The CFPB’s explanation touches upon one concern with the ROV process: a lack of consistent policies and protocols among lenders. One aspect that is consistent, however, is that the request for a ROV is made to the lender, who then contacts the appraiser. The homeowner or borrower may not contact the appraiser directly to request a ROV. Again, a ROV is warranted where there are deficiencies in the original appraisal
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of the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE). PAVE was created with five major commitments in mind. They include: (1) strengthening guardrails against discrimination in all stages of residential valuation; (2) enhancing fair housing/fair lending enforcement and driving accountability in the appraisal industry; (3) building a diverse, well-trained, and accessible appraiser workforce; (4) empowering consumers to take action against bias; and (5) giving researchers and enforcement agencies better data to study and monitor valuation bias. PAVE has been an instrumental step in the right direction for government to increase and ensure equity in the appraisal process.
continued on page 17
When a Homeowner or Borrower Needs Further Help
If the homeowner or borrower has evidence of appraiser negligence or discrimination, they should report it, in writing, to the lender. They may also file a complaint with HUD’s Fair Housing and Equal Opportunity office In response to increased recent recognition of the extent of appraisal bias, the federal “Appraisal Complaint National Hotline” was created. An aggrieved homeowner or borrower can follow this QR Code below, or they can call the hotline at 877.739.0096.
If the homeowner or borrower believes that a federally chartered lender discriminated against them, including by using an improper appraisal, they can submit a complaint to the CFPB by following this QR Code.
If the lender is a Maryland State-chartered bank, State-chartered credit union, or State-chartered trust company, a Complaint may be filed with the Commissioner of Financial Regulation, Attn: Consumer Services Unit, 500 N. Calvert Street, Suite 402, Baltimore, MD 21202, Phone: 410-230-6077. Follow this QR Code for more information.
A complaint may also be filed against an appraiser with the Maryland Commission of Real Estate Appraisers, Appraisal Management Companies, and Home Inspectors, on a form specified by the Commission. Please follow this QR Code.
Finally, a complaint may be filed with the Maryland Commission on Civil Rights. Please follow this QR Code.
FAIR HOUSING ACT
When Does a REALTOR® Use the Equal Housing Opportunity Logo?
The Fair Housing Act itself does not require the use of the Equal Housing Opportunity logo or slogan, “Equal Housing Opportunity,” in any ad. However, using the logo regularly is good evidence of the company’s commitment to fair housing compliance. The Equal Housing Opportunity logo is a picture of a small house with the words “Equal Housing Opportunity” directly beneath it. The small house picture cannot be used without the words “Equal Housing Opportunity” beneath it, but the words can be used without the small house pictured.
According to HUD guidelines, all advertising of residential real estate for sale or rent should contain an equal housing opportunity logotype, statement, or slogan as a means of educating the home-seeking public that the property is available to all persons, regardless of race, color, religion, sex, handicap, familial status, or national origin. The choice of logotype, statement, or slogan will depend on the type of media used and the size of the advertisement.
GET THE EQUAL HOUSING OPPORTUNITY LOGO: Go to
www.hud.gov Search... Equal Housing Logo
ADD THE EQUAL HOUSING OPPORTUNITY
STATEMENT TO YOUR BUSINESS PLAN:
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. We encourage and support an affirmative advertising and marketing program in which there are no barriers to obtaining housing because of race, color, religion, sex, handicap, familial status, or national origin.
Guidelines for Using the Equal Housing Opportunity Logo (in all ads of four column inches or larger) are available at: www.hud.gov/fairhousing
DISPLAY THE HUD FAIR HOUSING POSTER
Get the HUD Fair Housing Poster by visiting www.hud.gov/fairhousing search: poster
Fair Housing Regulations Require the Display of the HUD Fair Housing Poster at the Brokerage Office and at Dwellings Under Construction.
PROTECTED CLASSES AND THEIR DEFINITIONS*
FEDERAL LOCAL/COUNTIES
COLOR: Pertaining to a person’s skin color
FAMILIAL STATUS: Families in which one or more children under 18 lives with: a parent; a person who has legal custody of the child or children; or the designee of the parent or legal custodian, with the parent or custodian’s written permission. Familial status protection also applies to pregnant women and anyone securing legal custody of a child under 18.
NATIONAL ORIGIN: Refers to the geographic area in which a person was born, or from where their ancestors came.
PHYSICAL OR MENTAL DISABILITY: In reference to you or someone close to you who: has a physical or mental disability (such as hearing, mobility, and visual impairments, including use of a guide dog; drug addiction and alcoholism, mental illness, intellectual or developmental disability, HIV or AIDS, or cancer) that substantially limits one or more major life activities; has a record of such a disability; or is regarded as having such a disability.
RACE: Categories of physical characteristics and/ or genetic groupings of human populations.
RELIGION: Participation with one of the world’s structured religions; one’s spiritual beliefs; inference of religion by place of worship.
SEX (i.e., gender): Sexual orientation or gender identity per Presidential Feb 11, 2021 Exec. Order - see respective definitions.
MARYLAND
Includes All Federal Protections Listed Above Plus:
MARITAL STATUS: The state of being single, married, separated, divorced, or widowed.
RACE: The State of Maryland has expanded the definition of “race” to include traits associated with race including hair texture, afro hairstyles, and protective hairstyles (including braids, twists, and other hairstyles).
SEXUAL ORIENTATION: A component of identity that includes a person’s sexual and emotional attraction to another person and the behavior and/or social affiliation that may result from this attraction.
GENDER IDENTITY: the gender-related identity, appearance, expression, or behavior of a person, regardless of the person’s assigned sex at birth, which may be demonstrated by:
1. Consistent and uniform assertion of the person’s gender identity.
2. Any other evidence that the gender identity is sincerely held as part of the person’s core identity.
SOURCE OF INCOME: Any lawful source of money that is paid to or for the benefit of a renter or buyer of housing and includes grants, government assistance, alimony, child support, pensions, annuities, legal gifts, or investment earnings.
Includes all Federal and State protections listed and may include the following:
AGE: Generally referring to adults 18 yrs & over.
ANCESTRY: Line of descent.
CITIZENSHIP: a person’s actual or perceived immigration status
CREED: A person’s beliefs; also, a summary of principles or opinions to which someone professes or adheres.
ETHNIC ORIGIN: Cultural upbringing, including ceremonies and traditions.
FAMILY RESPONSIBILITY:
Refers to decisions based on an assumption of a person’s care giving responsibilities, either childcare or care of another family member.
GENETICS: Traits that are determined by genes or genetic mutations.
OCCUPATION: The principal lawful activity of one’s life, generally including students, welfare recipients and retired persons.
PERSONAL APPEARANCE:
The outward appearance of any person, irrespective of sex, with regard to hair style, facial hair, physical characteristics or manner of dress.
POLITICAL OPINION: The opinion of persons relating to government, the conduct of government, political parties, candidates for election or elected office-holders.
PRESENCE OF CHILDREN:
Households that include the temporary custody or permanent occupancy of persons under the age of 18 years.
VETERAN/MILITARY: A person who is a member of the U.S. Armed Forces, Reserves, or Maryland National Guard
MARYLAND REALTORS® PROMOTES FAIR HOUSING
All counties in Maryland abide by Federal and State definitions of Protected Classes (Maryland follows all Federal Protected classes plus additional state classes. below): STATE:
FEDERAL: Color
Familial Status
National Origin
Physical or Mental Disability Race
Religion
Sex (i.e., gender)
PROTECTED CLASSES
Maryland counties and Baltimore City follow all Federal Protected classes plus additional state classes; the counties that follow these standards only are highlighted in purple. Several counties and cities have additional Protected Classes, as described below. While Maryland REALTORS® makes every effort to keep this information up-to-date, counties and municipalities may change information at any time. Please check with your local jurisdiction to learn of any updates to fair housing in your area.
ALLEGANY
ANNE ARUNDEL
• Age
• Ancestry
• Citizenship/Immigration
• Creed Occupation
Annapolis
• Citizenship/Immigration
BALTIMORE COUNTY
• Age Creed
Veteran/Military
BALTIMORE CITY
• Age
CAROLINE
• Age
CARROLL
CECIL
CHARLES
DORCHESTER
Cambridge Age
Ancestry Creed
• Ancestry CALVERT
FREDERICK COUNTY
• Age
GARRETT
HARFORD
• Age
• Creed
• Occupation
• Personal Appearance Political Opinion
HOWARD
• Age
• Citizenship/Immigration
• Creed
• Occupation
Personal Appearance
Political Opinion
KENT
MONTGOMERY Age
Ancestry
• Creed
• Family Responsibility
• Presence of Children
Rockville Age
• Ancestry
• Ethnic Origin
• Genetics
• Presence of Children
Veteran/Military
PRINCE GEORGE’S
• Age
• Citizenship/Immigration
• Occupation
• Personal Appearance
Political Opinion
College Park
• Genetics
QUEEN ANNE’S ST. MARY’S
SOMERSET
TALBOT
WASHINGTON
Hagerstown
• Age
WICOMICO
WORCESTER
UNDER THE FAIR HOUSING ACT, IT IS ILLEGAL TO:
Refuse to rent to you or sell you housing because of your race, national origin, or any of the other Federal protected classes
Tell you housing is unavailable when in fact it is available
Show you apartments or homes only in certain neighborhoods
Set different terms, conditions, or privileges for sale or rental of a dwelling
Provide different housing services or facilities
Advertise housing to preferred groups of people only
Fail to design and construct housing in an accessible manner
Deny you property insurance in a discriminatory manner
Conduct property appraisals in a discriminatory manner
Refuse to make reasonable accommodations for persons with a disability if the accommodation may be necessary to afford such person a reasonable and equal opportunity to use and enjoy a dwelling
Refuse to provide you with information regarding mortgage loans, deny you a mortgage loan, or impose different terms or conditions on a mortgage loan
If You Believe Your Rights Have Been Violated...
Call the Maryland Commission on Civil Rights at (410) 767-8600 or visit www.mccr.maryland.gov/Pages/Intake.aspx to initiate an inquiry.
Harass, coerce, intimidate, or interfere with anyone exercising or assisting someone else with their fair housing rights
Visit our website, mdrealtor.org/FairHousing to learn more.
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or critical information is missing from the original appraisal. If the homeowner or borrower wants the appraiser to consider new information, which was not available at the time of the original appraisal, that is treated as a request for a new appraisal, rather than a request for a ROV.
Another area of concern with the ROV process is that the lender is not required to respond or to accept any documentation provided in support of the request for a ROV. Moreover, even where the appraiser considers the request for a ROV but does not change their opinion of value, the borrower is not entitled to receive a written explanation for such decision. While this can be frustrating, it is important to remember that it is illegal to try to influence the appraisal process, and the borrower and REALTOR® must avoid any improper contact or communication.
What options are available if the lender has refused to consider the request for a ROV, and the homeowner or borrower believes they have evidence of discrimination or negligence on the part of the appraiser? As a preliminary matter, prohibitions against discrimination under the Fair Housing Act and the Equal Credit Opportunity Act extend to appraisals. Maryland law also prohibits appraiser discrimination:
A [licensed appraiser] may not refuse, withhold from, or deny any person any of the accommodations, advantages, facilities, privileges, sales, or services of the licensed or regulated person or discriminate against any person because of the person’s race, sex, creed, color, national origin, marital status, sexual orientation, age, gender identity, or disability.
Md. Code Ann., State Gov’t § 20-402 (West). ■
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In addition to the actions mentioned earlier, there has also been a concerted effort to address the disparities in diversity within the appraisal industry. Data indicates that 81.5% of appraisers are White, 6.8% are Hispanic or Latino, and 4.6% are Black or African American. This data highlights the need for equity within the industry to ensure that there is more representation for minority and underserved populations. After considering the need for more diversity with the ever-growing need for additional training, the Appraisal Foundation has taken steps to raise awareness of bias, including implicit bias, among its appraisers. The organization decided to revamp its required seven-hour course on fair housing laws and bias in 2021 after multiple instances came to light where White appraisers were accused of valuing homes for minorities at lower values than Whites in the same neighborhood. Lisa Desmarais, Vice President of Appraisal Issues at the Appraisal Foundation, observed that, “In this way, we are directly reacting to appraisers needs to maintain and enhance public trust, as well as be a valuable and useful resource for appraisers with relevant and timely course materials.”
As we think about appraisal bias, I’d like to offer this thought for your consideration. Many conversations lean towards “fixing” the appraisal system. I suggest that the system is not broken. The system is functioning exactly as intended. Historically, the housing industry has consistently created policies and practices that directly impact minority communities. This ranges from Black codes, to steering, to redlining, and appraisal bias to name a few. These “systems” were created to marginalize and, at times, eliminate the ability of minorities to engage in homeownership. In those instances when minorities have been able to access home ownership, the system has done what it was intended to do by devaluing that ownership. Let us all remember that appraisal bias is not a SYSTEM issue, it is OUR issue, and this is OUR opportunity to correct it. ■
Kathleen Dartez, Esq. , is the Director of Legal Affairs for Maryland REALTORS®’.
Cleveland Horton is a REALTOR®, a member of NAR’s Diversity Committee, and Deputy Director of the Maryland Commission on Civil Rights.
Volunteer!
Volunteering for
committees not only helps the Association. It helps you.
BY CHRISTOPHER HILL
Last summer, Yolanda Muckle and I worked with Maryland REALTORS® staff to review every volunteer application to determine the make-up of the committees that direct Maryland REALTORS® activities.
This process lasted an entire day, early morning into the early evening. We sat down, examined each committee and their missions and the members who asked to serve. It was a long day. It was a bit exhausting, but it was also very, very rewarding, especially given that last year’s number of volunteers was the highest in recent memory.
I left that day feeling like we really accomplished something, and we certainly did. We placed over 350 members on our 21 committees. We reviewed the members who stepped up to volunteer, examined each volunteer’s strength and capabilities, and strategically laid the groundwork for a robust 2023. It was a terrific collaboration that combined the active interest of individual members, leadership (we’re volunteers, too!), and staff.
The number of volunteers who stood up speaks loudly about the level of engagement with our association. Volunteerism is the selfless act of dedicating your time and talent to your association, and I am happy to announce that Volunteer Season is upon us again. To make this year’s volunteering efforts a success, we need your help. The collective efforts of our members serving on committees directs the work of staff. Here are some of the recent successes coming from our committees:
■ volunteers played a major role in the development of new Statewide Forms
■ volunteers guided us on important legislative initiatives brought to the Maryland Legislature
■ volunteers selected the affinity partners we’d work with, to provide exclusive benefits to members
■ volunteers selected the theme, look, and programming for a sold-out Annual Conference
■ volunteers continued to drive the success of our popular Leadership Academy
■ there are so many more ways our members— volunteers—have directed the success of this organization
On the following pages are the descriptions of the committees that provide Maryland REALTORS® a direction and purpose. Whoever you are, whatever your personal story, no matter where you work in Maryland, I am asking you personally to volunteer. Recognizing that hybrid (in person and remote) meetings are here to stay, where we work matters very little. This new hybrid age allows us to harness strengths from our diverse membership, which draws from a variety of cultures, specialties, talents, and geographic locations.
Please take some time to review the committees while also considering your own interests and unique talents. What committees resonate with you? Using the QR Code on this page, sign up to volunteer for your preferred committees.
Yes, your work helps Maryland REALTORS®, but as someone who has volunteered for years, volunteering helps you and your career in developing skills and relationships that will prove valuable both personally and professionally. You will be building trust with those you volunteer with while growing your network.
I sincerely hope that you will consider volunteering and bring your expertise, no matter what it is. Doing so will make us even stronger Maryland REALTORS®. Thank You! ■
Christopher Hill is the 2023 President-Elect of Maryland REALTORS®.
Choose a Committee. Make Your Mark.
The work from Maryland REALTORS® members directly impacts the actions of this association. As members have different backgrounds and passions, they can surely find a committee where their expertise can help to elevate the association, its 32,000+ members, and themselves.
To make volunteering an easier process, we’ve published the missions of each of our committees. Review the committee’s purpose. Then, look at your background and think of the things that really interest you. Understanding both, what are your first, second, and third choices for committee involvement?
Use the QR Code on page 18 to sign up today.
Commercial Alliance
To provide a forum for commercial REALTORS® and real estate professionals to confer on commercial real estate related issues and to provide related networking and educational opportunities.
Communications and Public Relations
The Communications-PR Committee oversees and advises on the communications of Maryland REALTORS® in all its forms—print, digital, video, webinar, social, event (virtual or face-to-face), and broadcast technologies—to advance the business, ethics, education, and professionalism of its members at every professional stage. The
Committee helps to explore new opportunities and technologies for the Association to consider in its communications efforts, while also looking at ways Maryland REALTORS® can improve any or all its communications. Committee members will also help to provide ideas and leads for content in all its channels of communication. This Committee will also explore, vet, and suggest to Maryland REALTORS® businesses that wish to provide member benefits, for the Association’s consideration.
Community Involvement
This committee will be responsible for the administration of Maryland REALTORS’® annual REALTOR® Community Service Award and the William J. Neary Jr. Community Action and REALTOR® Excellence (CARE) Award. It will also be tasked with making recommendations for the association’s philanthropic and community service efforts.
Conference & Events Program Advisory Committee
To provide member input into the program development and promotion of Association meetings, events, and conferences in order to present innovative programming and exciting events for REALTORS® that encourage participation by brokers and agents, both seasoned and new to the industry.
To plan and develop the Annual Conference program content by identifying industry
trends and professional development needs of REALTORS® by reaching out to and involving a broad base of internal and external constituencies and subject matter experts. To provide networking opportunities for Association members.
Members will attend the Annual Conference and will be asked to staff various functions such as host and/or moderate education sessions as appropriate and provide logistical support as needed.
DEI Advisory Group
To create an authentic, vibrant, and inclusive industry culture through education, member engagement, leadership recruitment and community outreach.
Finance
The Finance Committee formulates and makes recommendations concerning strategic and financial planning and budgeting for presentation to the Executive Committee and Board of Directors. It also monitors the Association’s finances and prepares the fiscal budget of the Association for the coming year.
The Committee is responsible for development and implementation of Maryland REALTORS® Investment Policy. Some members of the Finance Committee may be appointed to the Investment Management Team. The Investment Management Team works with Maryland REALTORS® Investment Advisor (an outside firm) in developing a long-term investment plan and makes
appropriate investments to reach its goals.
Global Business Committee
Explore and build global business opportunities and relationships for association members—commercial as well as residential practitioners—through educational events, communications and networking. The committee will gather resources to create opportunities for affiliate practitioners of international real estate and coordinate with NAR Global to offer Certified International Property Specialist (CIPS) designation courses. Maintaining relationships with members of diverse groups such as the Asian Real Estate Association of America (AREAA), National Association of Hispanic Real Estate Professionals (NAHREP), and Certified Commercial Investment Member (CCIM) will be a priority.
Grievance Committee
Grievance
Committee
Members use their knowledge and expertise to serve local boards. They are professionalism ambassadors who work tirelessly to educate REALTORS® about their ethical obligations and strive to promote professionalism in the practice of real estate.
In ethics and arbitration cases, the Grievance Committee is tasked with examining complaints of unethical conduct and requests for arbitration from local Boards/Associations, either through direct requests or through Maryland
REALTORS® local Board/ Association Professional Standards Service Program to determine whether the ethics complaint or arbitration request should be forwarded to the Professional Standards Committee for a hearing.
Housing Opportunity
This committee is a partnership between the former Housing Affordability Committee, Equal Opportunity and Cultural Diversity Committee. Committee members will have the opportunity to develop programs and opportunities for all Maryland REALTORS® members statewide. Encourage REALTORS® and their local boards/associations to create and preserve housing affordability and opportunities by partnering with a wide range of lenders, nonprofit organizations, housing counselors, and state and local government agencies; provide oversight to Maryland REALTORS® Housing Opportunity Certification (formerly Workforce Housing Certification); promote financial literacy and develop content for the Maryland REALTORS® consumer website. There will also be a focus on promoting equal opportunity and fair housing practices and produce Maryland REALTORS® Fair Housing initiative. The committee will encourage cultural diversity through collaboration with multi-cultural real estate organizations such as AREAA, NAHREP, and NAREB.
Issues Mobilization
Evaluates issues funding requests presented by the Maryland REALTORS® or local REALTOR® Associations to determine whether they will
effectively promote REALTOR® policy. Sets criteria that those Associations must meet to access Issues Mobilization funds. Provides oversight to issues mobilization efforts initiated by the Maryland REALTORS®. Comprised of REALTOR® members and local Association staff who have knowledge of public policy initiatives and issues mobilization campaigns.
Leadership Academy Advisory Group
The Maryland REALTORS® Leadership Academy is dedicated to broadening and enhancing the leadership skills and capabilities of a blend of real estate professionals to prepare them to assume leadership roles within the industry and community. The Committee presents a program that will develop potential proactive leaders for the local boards/associations and the state association.
The Committee creates, implements, and develops the Academy program, including course content covering state and local issues. The Committee obtains sponsors, screens applicants for admission, emphasizing candidates with potential skills suitable for leadership positions within the industry and monitors the program delivery.
Legislative
Assesses the impact of specific bills on the real estate industry based upon the Maryland REALTORS® policy and legislative agenda, and determines whether the Maryland REALTORS® will support or oppose those bills. The Committee works directly with Maryland REALTORS® lobbyists and leadership in
advancing a pro-real estate legislative agenda.
Professional Standards
Professional Standards Committee Members use their experience and knowledge base to serve local Boards/Associations. They champion professionalism in the practice of real estate and develop programs on the NAR Code of Ethics and Standards of Practice with the goal of educating REALTORS® about their ethical obligations. They also provide arbitration and ethics hearing panels in cases where local Boards/Associations cannot adequately conduct hearings.
Public Policy
Develops and recommends Develops Maryland REALTORS® policy on issues impacting the practice of real estate, homeownership, and housing supply and affordability in both the legislative and regulatory arenas. The Committee recommends policies for adoption by the Executive Committee and future REALTOR® legislative initiatives. It is composed of broker-owners and active practitioners.
Real Property Operations
To advise the Maryland REALTORS® President and Leadership with regard to real property owned by the Association on matters including proposed leases for commercial tenants; extensions of existing leases; the value of and tenancy for commercial space offered; and other matters related to ownership and maintenance of such property. The Real Property
Operations Committee provides oversight of Maryland REALTORS® property, including Maryland REALTORS® occupancy strategy.
REALTOR® Institute
GRI Advisory Group
Administers courses for the GRI Designation, recommends instructors, subjects, scheduling formats and assists in promoting the GRI program. An Instructor Review Subcommittee monitors and counsels instructors and reviews current programs.
Statewide Forms Committee
Review all Maryland REALTORS® statewide contracts and addenda regarding the sale of property to determine changes, additions or deletions due to legislative actions and industry practice, with the goal of having a large majority of firms use the Maryland REALTORS® forms. Committee members are broker-owners or designees, and up to 20% of the membership may be comprised of non-owner practitioners. The Committee is responsible for having all forms reviewed by Maryland REALTORS® legal counsel and approved by the Executive Committee prior to release. ■
The Importance of Fair Housing
The Fair Housing Act not only makes it unlawful for jurisdictions and public housing agencies to discriminate, the law also requires jurisdictions to take actions that undo historic patterns of segregation and other types of discrimination, as well as to take actions to promote fair housing choice and to foster inclusive communities.
Fair housing continues to be a main priority for the Maryland Mortgage Program (MMP). MMP is specially designed to help lower the financial burden for low to moderate income households, with the majority of home loans going to Black, Indigenous, and People of Color. We offer home loans that come with down payment and closing cost assistance and competitive interest rates. A new home could be right around the corner for your potential homebuyers!
Thank you to all of our partners for helping make Maryland communities flourish! Fair housing practices are a crucial and integral part of the housing community. The State of Maryland is dedicated to upholding these standards and, with the help of our REALTOR® partners, we’re building strong Maryland communities. The Maryland Mortgage Program has been the state’s flagship homeownership program for over 40 years. ■
Follow us on social to stay up to date: facebook.com/ marylandmmp/ instagram.com/ marylandmmp/ twitter.com/ marylandmmp
Greg Hare is the Assistant Secretary, Maryland Department of Housing and Community Development. mmp.maryland.gov, singlefamilyhousing. dhcd@maryland.gov, 1-800-756-0119
Navigating Flood Insurance: How REALTORS® Can Help Clients Protect Their Homes
BY MARYANN TIERNEY FEMA REGION 3 REGIONAL ADMINISTRATOR
Purchasing a home can be an exciting, yet overwhelming, process for first-time and seasoned homebuyers alike. As a REALTOR®, you serve a critical role in guiding your clients through this process, which includes providing information about flood risk and flood insurance. At FEMA, we are always talking about the importance of flood insurance, when clients hear it directly from a trusted REALTOR®, it can make a big difference.
Should Your Client Purchase Flood Insurance? Absolutely. Flooding can happen anywhere and at any time with little to no warning. Here are three ways you can help your client:
1. Identify their flood risk. Encourage buyers to look up their address on Maryland’s flood tool at mdfloodmaps. net to see if their property is on a floodplain. Inform your clients that flood risks can change over time and that even small streams can pose a risk to their property.
2. Share information early. Encourage sellers to disclose flood risk information and ask buyers to get a quote for flood insurance early in the process.
3. Understand flood insurance coverage. Most standard homeowners’ insurance policies do not include flood damage. Unfortunately, many homeowners learn they are not covered when it’s too late. Advise your clients to talk with an insurance agent about flood insurance coverage.
What if the property is outside the floodplain? Should you still encourage your client to consider flood insurance? The answer is yes. In fact, 40% of flood insurance claims come from outside of high-risk flood zones.
National Flood Insurance Program & Risk Rating 2.0: Benefits for Your Clients
The National Flood Insurance Program provides flood insurance policies that can protect both a building and its contents. Last year, FEMA completed a holistic update to the way it prices flood insurance policies across the country. This effort, called Risk Rating 2.0, was endorsed by the National Association of REALTORS® (NAR), and has three primary benefits for your clients:
1. Rates are more specific to the flood risk for each property, rather than generic flood zones.
2. Elevation certificates are no longer required for flood insurance rating.
3. Now, people can get a quote for flood insurance in a matter of minutes. This means the cost of a flood insurance policy can be determined earlier in the loan underwriting process, minimizing complications at closing.
What Other Ways Can Clients Mitigate Their Flood Risk?
If you have a client that has or could suffer flood damage, help them minimize their flooding risk and protect their investment.
1. Elevate Utilities Above the Flood Height. Elevate or floodproof mechanical units, furnaces, water heaters, electrical systems, and other utilities on masonry, concrete, or pressure-treated lumber at least 12 inches above the base flood elevation (expected height of flood waters).
2. Install Flood Vents. Install flood vents in foundation walls, garages, and other enclosed areas to allow water to flow through, drain out, and lower the risk of structural damage. Don’t use flood prone spaces as living areas in a home.
3. Use Flood Resistant Materials. Tiles are more food-resistant than carpet.
Water-resistant wall materials are better than dry wall. Using these materials makes cleaning easier and reduces mold.
4. Store Valuables: Store valuables and important documents in waterproof or water-resistant containers on an upper floor. Make copies and store them online or offsite.
April is Flood Awareness Month
Each year, we partner with Maryland on a Flood Awareness Month in April. This year, we’re excited to focus one week on flood information for first-time homebuyers, April 17-21, 2023. Agencies will be sharing information on their social media platforms, hosting virtual events, and providing digital resources. Look out for information on Twitter @FEMAregion3 and @MD_Insurance
Over the past few years, we’ve been encouraged by our growing partnership with Maryland
REALTORS®. We appreciate the valuable role the Association and its members play, not only by helping people find their perfect home, but also in making sure they protect their investment. The key is to start the conversation early and educate your clients about their options. By doing so, you can help them purchase a home with confidence, knowing they have taken the necessary steps to protect their property and finances.
Here at FEMA, we are committed to helping people before, during, and after disasters. We hope this information will help your client when it comes to protecting their home and their future.
MaryAnn Tierney is FEMA’s Region 3 Regional Administrator.
Learn More about Flood Awareness
What is the “Missing Middle”?
BY LISA MAY
® Who doesn’t love a magic trick?
Pulling a rabbit out of a hat ... picking a card out of the deck … making the rubber ball vanish into thin air.
Unfortunately, when it comes to Maryland’s “missing middle” housing, there’s no mystery as to why it disappeared nor any magic to make it reappear before our eyes.
What is “Missing Middle” Anyway?
It’s a common misconception that “missing middle” refers to a group of homebuyers who are not finding the housing options they need in today’s market. However, this term describes the housing itself, along with its form and scale.
Missing middle housing is compatible in scale with existing singlefamily homes but provides more diversity in home sizes and price points for area residents than those existing homes. It includes multifamily housing of four to eight units, smaller-scale homes that are clustered around a common courtyard, accessory dwelling units (ADUs), and duplexes and triplexes.
It is housing that is needed to serve populations that are experiencing housing shortages and affordability challenges in Maryland: low- and moderate-income workers, seniors, and young professionals. It also serves the desires of those groups to live in walkable neighborhoods close to local amenities.
Why Do We Consider It Missing?
At its simplest, something becomes missing when it existed in the past but does not in the present. That’s exactly where we find ourselves with this type of housing.
Up to and including the 1940s, multiplex dwellings, garage apartments and the like were common features of residential neighborhoods. They also created a critical mass of population density to support local retail and emerging public transit options.
What changed? Several factors in the late 1940s and early 1950s altered the trajectory of missing middle housing. Chief among them was the widespread adoption of local zoning codes.
We have previously highlighted the history of zoning in this magazine, and how it was designed to physically separate different land uses from one another. It also served to separate the types of people who tended to populate those uses from one another.
Multi-family housing for those of lower incomes was deemed to be in a different category from larger homes on larger lots. Thanks to the availability and relative affordability of autos for the middle and upper classes, those larger homes could be in the suburbs, farther away from public transportation options and without the need for walkable amenities.
The separation of uses had a direct impact on missing middle housing production. Small-scale multifamily
dwellings, including duplexes, triplexes, and quadplexes, once comprised over 7% of our housing stock. Over the years, as new building has favored other building types, it has fallen to just over 1% of our total housing stock.
How Can We “Find” It Again?
Unfortunately, it’s not as simple as starting to build these housing types once again. Many of them cannot be built without reforms to the zoning practices instituted 70 years ago, and the rest tend to fall victim to a public resistance to change.
Even though scholars began promoting missing middle housing options in the early 2000s, they’re just now catching on at the state and local levels.
States like California, Maine, and Oregon have instituted broad zoning reforms to allow residential lots to hold up to four units and have actively promoted the creation of ADUs on existing properties. In Maryland, however, we’re only beginning to scratch the surface.
For the past two years, Maryland REALTORS® has introduced legislation on ADUs with the hopes that we will eventually join the ranks of those states with a statewide standard. Despite those efforts, we are still at least a year away from making recommendations to counties and cities, who have opposed more immediate action.
Some of our localities are moving forward, loosening single-family zoning regulations to allow more missing middle options. This
includes the Abundant Housing Act in Baltimore, which would remove many restrictions of the conversion of single-family lots into lowdensity multi-family units – the very definition of missing middle housing. Similarly, Montgomery County’s Thrive 2050 comprehensive plan envisions the creation of cottages, duplexes and quadplexes through future ordinances and zoning text amendments.
Despite the merits of these approaches, there is still plenty of opposition to change from within local governments and existing residents alike. Some of that opposition comes from “Not in My Backyard” sentiment, and some comes from more legitimate concerns over infrastructure needs. Neither, however, should be an excuse to shut down or abdicate responsibility for replacing the housing that our rules and regulations have taken away.
Bringing back missing middle housing will involve more sausagemaking than magic wand waving, but there’s no trick in how we should proceed. ■
May is the Director of Advocacy and Public Policy for Maryland REALTORS®.
Lisa
Be a Source of Sources
BY CHUCK KASKY
When deciding on a property to purchase, homebuyers tend to be influenced by the neighborhood, the local school district, and many other considerations. Questions about properties of interest are often fielded by real estate professionals, and for good reason. The REALTOR® is often seen as the community expert. Answering these questions can be tricky, and agents should start by making sure they are up to date in their REALTOR® Code of Ethics training and have a firm understanding of Fair Housing laws before providing answers. These two resources provide foundational directives for real estate professionals, which enable an agent to share information in a way that best serves the client, while adhering to the law and Code of Ethics, as well as managing the risks inherent in the law requiring real estate licensees to disclose certain facts concerning property. These activities have two potential consequences: failure to disclose material facts and violating Fair Housing laws. Many complaints to the Maryland Real Estate Commission involve an alleged failure to disclose information the consumer believes could have had an impact on their decisions concerning the property. Maryland REALTORS® has substantial resources to explain our disclosure obligations, so please take advantage of them.
Certain information, like school districts, or crime statistics, if misused, may lead inadvertently (or worse, intentionally) toward steering clients in one direction or another, which is a potential Fair Housing violation. To avoid these consequences, real estate professionals should offer resources like links to school board, law enforcement websites, and sources to research building permits and inspections, for example. Doing so comports with our obligations and positions us as a trusted resource to clients.
When meeting with clients, demonstrate your value proposition by being their “source of sources,” meaning you can direct clients to a variety of resources that will give them objective and reliable information so they can make decisions for themselves about whether a property meets their desired criteria.
Real estate professionals should ask their clients to define what they want and provide reliable resources to help them make informed decisions. Maryland REALTORS® publishes a document, “Consumer Notice to Buyers of Residential Real Estate in Maryland,” which provides prospective buyers with specific examples of matters that may be important to them and sources of information about those matters.
It has been our consistent and long-held position that great care should be taken before holding REALTORS® responsible for certain
disclosures. We readily accept a real estate licensee’s duty to disclose material facts the licensee knew or should know. But there must be limits, or there will be no end to our obligations and, of course, potential liability. A good example of this is our insistence that there is a significant difference between onsite and offsite conditions, especially if information pertaining to those conditions is a matter of public record.
We maintain that REALTORS® cannot be held responsible for researching, discovering, and/ or disclosing matters of public record that concern offsite conditions because this information is as accessible to the consumer as it is to us. In other words, it does not take any specialized knowledge, training, or skill to acquire this information. We are, and always will be, committed to being the trusted partner and the source of sources for reliable information to help our clients make their best decisions. ■
Chuck Kasky
the CEO of Maryland REALTORS®.
is
Creating an Agent-Centric Brokerage
BY LINDA HARNED
The real estate industry is one of the most competitive businesses for recruiting and retaining good REALTORS®. With today’s technology of Zoom meetings and webinars, building and maintaining strong relationships with our agents is more challenging than ever before.
Focus on creating ways for your agents to grow with you rather than grow away from you.
Although it can be very challenging to create and build a culture and environment that illustrates how much REALTORS® are appreciated and valued in your brokerage, we need to determine a culture that works for both the agents and the brokerage. An acronym that can best describe a successful brokerage that has high retention and productivity is CARE: Communication, Accountability, Respect and Empathy. These four characteristics can create the foundation of your brand and brokerage and set you on a course for creating an agent-centric brokerage.
Here are a few examples of what it means to be an agent-centric brokerage:
Nurturing relationships with Agents. New agents are more likely to switch brokerages faster than long term agents if they don’t feel respected, appreciated, connected, and valued. Remember, value is not always measured in dollars! Acknowledge an agent’s
first transaction with an inexpensive award for recognition of a job well done, and it also demonstrates how proud you are of their accomplishments.
We know that communication is a critical factor in any industry; creating commitment and loyalty to your brand will be measured by the form of communication you exercise and your actions towards your REALTORS®. That will determine the success of your goal. Show appreciation for their successes through personalized messages and notes. Always be sincere.
Holding your agents accountable by defining their expectations and their basic needs exhibits the type of culture you have created. Showing care and illustrating their value to you and your brokerage is the determining factor in gaining their respect and the respect you have for them. But more importantly, it lets the agents feel valued and important. Empathy focuses on how they feel by summarizing that you hear them and reinforces that you are listening, and you care. For example, “I understand you feel that way,” or “What can we do to correct this misunderstanding?”
Most agents have six basic needs when choosing or staying at a brokerage: Caring, Understanding and Empathy, Fairness and Honesty, Options, Support, and Culture. These six basic needs create the value that the average
agent is looking for. Value is a very difficult word to define or measure in today’s real estate market.
To summarize, some ways to show agents that they are valuable and important include: 1) always acknowledge their accomplishments; 2) ask what their needs or concerns may be; 3) try to resolve their issues in a timely fashion; 4) show respect for their time; 5) be responsive; and finally 6) demonstrate a willingness to make change within your brokerage or agents when necessary. Transition back to a hybrid model for meetings and training workshops to accommodate everyone’s comfort level because learning is the key to success. It is not always about money. When there is value, consistency, and trust, you will find loyalty. ■
Linda Harned is an Associate Broker and Director of Industry Relations for Douglas Realty.
How Far Can Faith Take You?
BY STEVEN MESSMER
Q:Can a REALTOR® assist a religious organization in selling, renting, and/or marketing residential property they own if the organization is seeking an occupant of their same faith?
A: The short answer is “no,” but there is an exemption in the Fair Housing Act (the “Act”) that permits religious organizations to give preferential treatment to occupants of that organization’s faith. The Act allows religious or related nonprofit organizations to deal exclusively or preferentially with members of their religion in the “sale, rental, or occupancy of dwellings.” A three-part test is used to determine if an organization qualifies for the exemption:
1. the housing must be provided by a religious organization or a nonprofit that is “operated, supervised, or controlled by or in conjunction with a religious organization;”
2. the housing must be provided for a purpose “other than a commercial purpose;” and
3. membership in the subject faith or religion must not be “restricted on account of race, color, or national origin.”
Application of this exemption can be found in the case of Intermountain Fair Housing Council v. Boise Rescue Mission Ministries The case involved an organization that operated a residential drug treatment program and a
homeless shelter that were only open to Christians or those who desired to convert. A woman in the drug treatment program filed a complaint, claiming that requiring participation in religious activities in order to be in the program was discriminatory. In applying the three-part test, the Court found that the nonprofit operating the shelter was a religious organization. Next, the Court determined that the shelter did not generate revenue, let alone profit. Finally, the Court found that the nonprofit did not engage in any discrimination on the basis of race, color, or national origin. Therefore, the Court found that the exemption applied, and the nonprofit was permitted to continue limiting housing in the shelter on the basis of prospective occupants’ religion.
Another case, U.S. v. Columbus Country Club, resulted in the opposite outcome. In Columbus Country Club, a country club rented properties only to its members, all of whom were Roman Catholic. The federal government sued the country club claiming religious discrimination. The country club claimed that although it was not a religious organization, it was a nonprofit that acted in conjunction with the Roman Catholic Church
because the church held services at the country club each week. The Court read the exemption narrowly and found that the club was not a related nonprofit Because the country club had no formal relationship with the church, it was not “operated, supervised or controlled by” the church. Because the church was barely involved in the operation of the country club, the nonprofit did not act “in conjunction with” the church. Accordingly, the Court found that the exemption did not apply.
However, even if the religious exemption applies to a religious or related nonprofit organization, such properties cannot be advertised (including listed on the MLS) because there is no religious exemption with respect to advertising. The Act prohibits the making, printing, and publishing of advertisements that indicate a preference, limitation, or discrimination based on religion. Additionally, REALTORS® are not allowed to assist in a residential transaction even if it qualifies under the religious exemption. Regulations adopted under the Act state: “It shall be unlawful for any person … whose business includes engaging in the … brokering … of residential real property to discriminate against any person … in the performance of such services, because of … religion.” ■
Steven Messmer is a third-year law student at the University of Baltimore School of Law, currently serving as a Legal Extern for Maryland REALTORS®.
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Awards
The Maryland REALTORS® takes great pride in awarding industry honors to outstanding REALTORS®. Recognition is a positive reward for a job well done. It is vital that we honor those individuals who have given outstanding service to the real estate industry and the local boards/associations. The awards will be presented during the Annual Installation and Awards Gala later this year.
THE
MARYLAND REALTORS® GOOD NEIGHBOR AWARD:
Honors individual REALTOR® members who give unselfishly of their time to assist the communities in which they live. Individuals can apply directly to Maryland REALTORS® and there is no limit to the number of entries submitted by local boards/associations or firms for this award. All nominees submitted to local boards/associations must be submitted to Maryland REALTORS®
DEADLINE: JULY 9, 2023
THE
COMMUNITY ACTION AND REALTOR® EXCELLENCE (CARE) AWARD: This award is given to local board/associations recognizing achievements in community service and charitable actions. The award is designed to raise the profile of REALTORS® and the REALTOR® organization by focusing on boards or associations that have demonstrated an extraordinary record through direct local board/association community service involvement and to include endeavors by REALTOR® members who are part of a local group, team, office or individually. The Award will be divided between a large board/association (1,000+ members) and a small board/association (fewer than 1,000 members) beginning June 1, 2022 through July 1, 2023.
DEADLINE: JULY 9, 2023
THE REALTOR®
OF THE YEAR (ROTY) AWARD:
One ROTY application is required to be submitted by each local board/association to be entered in the Maryland REALTORS® competition. The winner of the state award will travel to National Association of REALTORS ® (NAR) Annual Convention for consideration in the national award. This award is submitted directly by your local board/association for consideration.
DEADLINE: CONTACT YOUR LOCAL ASSOCIATION
DEI LEADERSHIP AWARD:
This award is designed to recognize those who have made significant steps towards creating a more diverse and inclusive community through the implementation of initiatives and/or programs reflective of Maryland REALTORS® .
DEADLINE: JUNE 17, 2023
Forms to all awards will be available online on May 1, 2023.
Other annual awards include the Lifetime Achievement Award, Omega Tau Rho Fraternity Award, President’s Award, Shining Star Award, and more. For a full list of all the awards given by the association or to download application form, please scan the QR code or call or call Maryland REALTORS® at 443.716.3500.
