OC REALTOR®: May/June 2022

REALTOR® PARTY RECOUNTS LEGISLATIVE SUCCESSES ON PAGE 18

HOMEOWNERSHIP MATTERS! ON PAGE 8 KEY EVENTS IN THE DREAM OF HOMEOWNERSHIP ON PAGE 26 FIVE REASONS TO SELL IN TODAY’S MARKET ON PAGE 30

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HOUSING CHALLENGES FACED BY PERSONS WITH DISABILITIES ON PAGE 32 WHEN WILL THE MARKET SLOW? ON PAGE 34

A WORD ABOUT THE 2022 ELECTION Ordinarily, Orange County REALTORS® holds a formal election of Directors in May. But this year, the process was different. The Association Bylaws provide that, if the number of qualified candidates seeking positions on the Board matches the number of open positions, the Board may, at its discretion, declare that the candidates are Directors without holding a formal election. And that is exactly what happened this year.

Congratulations to candidates Tony Faulkner, Chip McAllister, Charleen Nagata Newhouse, and Mary Rampone, who were chosen to serve as Directors for the period from 2023 through 2025!

on pages 22–24

CONTENTS MAY | JUNE 2022

Homeownership Matters!

“Home” has a very special meaning. A familiar proverb asserts, “Home is where the heart is.”

John Howard Payne intones, “There’s no place like home,” in his poem “Home, Sweet Home.” And homeownership has long been viewed as a key component of the American Dream.

Homeownership creates jobs in local communities.

According to the National Association of REALTORS, for every two homes sold, one job is created. Each home sale at the median added $88,500 to the economy in 2019. And real estate accounts for 15 to 18 percent of the U.S. gross national product.

Homeownership matters to individuals and families! Research has consistently shown that homeownership has a measurable and significant positive impact on net worth, educational attainment, civic participant, neighborhood health and safety, and overall quality of life.

Encouraging homeownership is sound public policy. For this reason, it is important that Congress enact laws and support policies that encourage homeownership so that this fundamental component of the American dream remains well within reach.

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PRESIDENT'S MESSAGE

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Homeownership Matters!

President Adam Rodell affirms that selling homes is meaningful, in part because homeownership truly matters to so many in so many ways.

LEADERSHIP ACADEMY

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Alumni: Where Are They Now?

Sabrina Blair asks four graduates of the Orange County REALTORS® Leadership Academy what they enjoyed about the process, what they learned from the experience, and how these lessons have influenced their personal leadership journey.

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STATE UPDATE

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HOMEOWNERSHIP

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C.A.R. President Otto Catrina describes some laws REALTORS® supported and some laws REALTORS® thwarted in the interest of their communities, clients, and businesses.

In timeline fashion, Michelle McCann lists by year and name eleven laws and events that have shaped homeownership in the United States.

The REALTOR® Party of California Recounts Its 2021 Legislative Successes

COVER STORY

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Meet Your New Directors

Sherri Butterfield invites readers to become better acquainted with the four new OCR Directors: Tony Faulkner, Chip McAllister, Charleen Nagata Newhouse, and Mary Rampone.

Key Events in the Evolution of the Dream of Homeownership

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Five Reasons to Sell In Today’s Insane Market

Sabrina Blair points out that sellers hold the power while the demand for homes is hot and can call the shots and maximize their profit.

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Housing Challenges Faced by Persons with Disabilities

Michelle McCann describes services and provides contact information for programs that offer help with accessibility, renovation, and discrimination challenges.

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FEATURES

On the Cover: The 2022 Board of Directors Election

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The Orange County Housing Update: When Will the Market Slow?

Steven Thomas says higher interest rates could cool a market that has been hot since the beginning of the year.

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Print and Marketing Specialist Ivan Salmeron has used photos of the four recently chosen Orange County REALTORS® Directors—Mary Rampone, Tony Faulkner, Charleen Nagata Newhouse, and Chip McAllister—to create the cover for this issue.

Annual Membership Meeting and Forecast

Sherri Butterfield describes this in-person event that featured presentations by Art Carter, Otto Catrina, Shannon King, Lawrence Yun, Joyce Endo, and Adam Rodell.

DEPARTMENTS

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Names in the News

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Education Central: Upcoming Classes by Track

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MAGAZINE

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25552 La Paz Road Laguna Hills, CA 92653

10540 Talbert Avenue, Ste. 225 West Fountain Valley, CA 92708

Mission Statement

949-586-6800

714-375-9313

2022 OFFICERS Adam Rodell President Scott White President-Elect Joyce Endo Treasurer Lori Namazi Immediate Past President Dave Stefanides Chief Executive Officer

2022 BOARD OF DIRECTORS Erin Barry Matt Cortez Bob Fox Christina Fu Michele Harrington Len Herman Jeffrey Jackson Lori Jones Paul LePage Chip McAllister Steve Mino

Ed Molina Eileen Oldroyd Pamela Pedego Vinil Ramchandran Randy Rector Lacy Robertson Mary Rampone Lynne Suzanski Stuart Thomas Lisa Yi

MAGAZINE STAFF Sabrina Blair

Breanna Reed

Sherri Butterfield

Ivan Salmeron

Director of Communications sabrina@ocrealtors.org Communications Specialist sherri@ocrealtors.org

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Accounting Administrator breanna@ocrealtors.org Print & Marketing Specialist ivan@ocrealtors.org

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OC REALTOR®

The mission of Orange County REALTORS® is to promote the REALTOR® Code of Ethics; to provide education, services, and resources to our members; and to advocate the protection of real property rights.

Notice to All Members It is the long-established policy of this Association, California Association of REALTORS®, and the National Association of REALTORS® to adhere to both the letter and spirit of the federal and state antitrust laws. For their own protection, members should be aware of the antitrust laws as they affect their specific business activities. Any illegal activity under the state and federal antitrust laws is not in compliance with Association policy, nor is it in the interests of the Association or its members. Participation in Association activities must occur only in harmony with these very important laws. Federal law prohibits discrimination based on race, color, sex, religion, or national origin in connection with the sale or rental of residential real estate, in advertising the sale or rental of housing, in the financing of housing, and in the provision of real estate brokerage services. The OC REALTOR® editor reserves the right to review and edit all submissions. Orange County REALTORS® makes no warranties and assumes no responsibility for the accuracy of the information contained herein. The opinions expressed in articles are not necessarily the opinions of Orange County REALTORS®. Orange County REALTORS® does not necessarily endorse the companies, products, or services advertised in this magazine unless specifically stated.

OC REALTOR® (USPS 025-445, ISSN 1945-2179) Volume 13, Issue 3, is published by Orange County REALTORS®, 25552 La Paz Road, Laguna Hills, CA 92653. Periodicals postage paid at Laguna Beach, CA, and additional mailing offices. POSTMASTER: Send address changes to Orange County REALTORS®, 25552 La Paz Road, Laguna Hills, CA 92653-5127. Annual membership dues include $6.09 for a one-year (6 issues) subscription to OC REALTOR® magazine. OC REALTOR® cannot be responsible for unsolicited materials.

Publisher: Orange County REALTORS® Printer: The Monaco Group

PRESIDENT'S MESSAGE

MATTERS!

By Adam Rodell 2022 PRESIDENT, ORANGE COUNTY REALTORS®

I sell homes.

For as long as I can remember, I have had a passion and a gift for sales. Over a period of years, I have sold a variety of products, ranging from home improvements to investments. In these endeavors, my hard work consistently yielded success, but not the satisfaction I was seeking. I needed a different product to sell, one that seemed to me to be more meaningful to more people.

In 1996, I met my wife, Christine, who was working in real estate. Two years later, I earned my real estate license, joined her in the real estate business, and found my calling.

Now, I am proud to say that I sell homes.

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Without question, homeownership matters to individuals, families, neighborhoods, and communities.

Homes are important.

Homes are important. They do far more than simply satisfy the basic human need for shelter. They are the special places where families gather and grow, where hopes and dreams are nurtured, and where lasting memories are made and cherished. For most people, a home is the biggest-ticket item that they purchase in a lifetime.

Photo: www.istockphoto.com/eclipse_images

HOMEOWNERSHIP

Photo: Marion Butterfield

PRESIDENT'S MESSAGE

Homeownership matters.

Homeownership matters. Ten years ago, in May 2012, some 13,000 REALTORS® visited Washington, D.C. At that time, credit had been tightened in the wake of the housing market crash. As a result, the annual homeownership rate had dropped to 62 percent, the lowest it had been in a decade, and the number of first-time home buyers had declined from 50 percent in 2010 to 37 percent one year later. In response, REALTORS® from across the country descended on the nation’s capital to deliver an important message to Congress: “Homeownership matters.” Among other things, they wanted legislators to support lower mortgage interest rates and preserve the mortgage interest deduction as ways of encouraging homeownership and putting this important component of the American Dream within reach for more people.

Homeownership is fundamental to the American Dream.

One of the speakers who addressed the REALTORS® during their Washington, D.C., visit was Democrat strategist and pollster Celinda Lake. She observed, “Voters see homeownership as fundamental to the American Dream.” And they see that dream disappearing. At the time, 74 percent said homeownership was worth the risks; 63 percent of those whose homes were underwater agreed. And 68 percent of those who did not currently own a home wanted to. Thus, homeownership received a much higher overall approval rating than the 14 percent given to Congress.

“Homeownership supports an

average of more than 2.5 million private-sector jobs every year,

and real estate accounts for 15 to 18 percent of the U.S. gross

”

domestic product.

And homeownership by individuals benefits us all.

Homeownership has a positive impact on net worth and results in better-connected families and greater educational attainment.

Homeownership offers significant social benefits to neighborhoods in the form of more cohesive communities, improved health and safety, and greater civic participation. And homeownership benefits the overall economy.

For example, the National Association of REALTORS® (NAR) estimates that each home sale at the median added $88,500 to the economy in 2019. Homeownership supports an average of more than 2.5 million privatesector jobs every year, and real estate accounts for 15 to 18 percent of the U.S. gross domestic product.

As was true a decade ago, it is important that Congress enact laws and implement policies and practices that encourage homeownership so that this fundamental aspect of the American Dream remains within reach for all who believe in it and are willing to work hard and invest in achieving it.

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NAMES IN THE NEWS

REALTORS® Enjoy Sips and Sweets at Sunset in Support of Congresswoman Michelle Steel

“We Support You, Ukraine” In November 2019, the Laguna Hills office of Orange County REALTORS® welcomed members of a Ukrainian delegation as part of their post-NAR-Convention in-bound Trade Mission. At 5:00 a.m. on February 24, 2022, Russia attacked Ukraine in what has become the first large-scale European military conflict since the end of World War II. In response to a request from Olesya Drozdova that the Association voice its support for Ukraine, President Adam Rodell penned the following message for publication in a special edition of What’s Up, which was sent via email to members of Orange County REALTORS® on March 4: “On behalf of Orange County REALTORS®, we would like to express our deepest condolences to the people of Ukraine who have lost their lives, their homes, and their sense of security while protecting their country from Russian invasion.

Our thoughts are with the Ukrainian people abroad as well as those who are here locally. I encourage you all to take a moment to read a heartfelt letter from one of our REALTOR® members, Olesya Drozdova . . . and consider making a donation in support of the Ukrainian people to one of the organizations whose work is described below.

International Committee of the Red Cross is working to repair vital infrastructure, support health facilities with medicines and equipment, and support families with food and hygiene items. UNICEF is working to ensure Ukraine’s children have access to safe water, nutrition, health care, education, and protection. Doctors Without Borders is working to set up emergency response activities in Ukraine and dispatching teams to Poland, Moldova, Hungary, Romania, and Slovakia.”

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On March 5, two unidentified guests (on the left) joined Ron Pascual, Katie Martin, Pearl Linn, Matt Cortez, Brian Genovese (seated), Jeannie Luong, Adam Rodell, Paula Cosenza, Rick Cosenza, and Christine Rodell for a Meet and Greet with Congresswoman Michelle Steel (standing in the back).

Katherine Stopp Named Superintendent of Fountain Valley School District On March 14, 2022, the Fountain Valley School District Board of Trustees named Dr. Katherine Stopp District Superintendent effective April 1, 2022. Dr. Stopp joined the District in July 2021 as the Assistant Superintendent of Educational Services. Founded in 1876, the Fountain Valley School District is comprised of ten schools serving more than six thousand students from Fountain Valley and Huntington Beach.

Mike Munzing Named Affiliate for Life Congratulations to Mike Munzing of Munzing Mortgage Group who has been named an Affiliate for Life in recognition of twenty-five years of active Affiliate membership in Orange County REALTORS®.

Membership records show that Mike joined Orange County REALTORS® on July 25, 1996.

NAMES IN THE NEWS Heidi Stoops Honored Among Orange County’s Women of Distinction In March, during Women’s History Month, when Congresswoman Michelle Steele honored eighteen Orange County Women of Distinction, Heidi Stoops was among them. Specifically, Heidi, who is a REALTOR® with Coast to Canyon Real Estate, a graduate of the Orange County REALTORS® Leadership Academy, a community volunteer for various events in Aliso Viejo, and sits on the Board of Directors for the Memorial Care Saddleback Medical Center Foundation, was recognized for “her dedication to service in the community and throughout Orange County” and thanked “for all that you do.”

Lincoln Club of Orange County Honors Irvine Vice Mayor Anthony Kuo On March 10 at a Board of Directors meeting, the Lincoln Club of Orange County presented Irvine Vice Mayor Anthony Kuo with its Impact Award.

This award recognizes exemplary public servants who are devoted to community efforts benefitting Orange County families and beyond. Specifically, the Club recognized Vice Mayor Kuo for having given unwavering support to his city’s local law enforcement agencies—especially during the “Defund the Police” movement—thereby helping Irvine retain its distinction as America’s safest city. Also mentioned was Vice Mayor Kuo’s attention to fiscal responsibility. He has passed two 2-year budgets without tax increases, and Irvine’s Fiscal Year ending in 2022 is expected to have a $10 million surplus.

Laguna Hills Mall Will Become The Village at Laguna Hills A year ago, at a mid-March meeting, members of the OC REALTORS® Local Government Relations South Committee were given a preview of plans to transform the aging and empty Laguna Hills Mall into the Village at Laguna Hills (see the related article on page 13 in the May/June 2021 issue of OC REALTOR®). The proposal at that time was to transform the 68-acre parcel at the intersection of El Toro Road and the I-5 Freeway into the largest mixed-use development in South Orange County, which would include 250,000 square feet of retail space, 488,000 square feet of office space in buildings no more than four stories high, a movie theater, a central park, a hotel with 100 to 150 rooms, and 1,500 residential units, 200 of which would be affordable with both low and moderate designations.

A year later, in March 2022, the Laguna Hills City Council gave its approval to this project. While the concept is still evolving, the current plan is to demolish the former mall and most of the surrounding buildings. Only the In-N-Out Burger, BJ’s Restaurant and Brewhouse, and King’s Fish House will remain. The Nordstrom Rack will be relocated under the new movie theater that will border the park.

Although some council members voiced concern about the economic impact of reducing the project’s retail footprint and increasing the number of apartment units, Councilman Don Sedgwick said that members of the community were “tired of seeing a big parking lot on the side of the freeway” and “really need something that is going to be a vibrant center for the community to enjoy.”

A developer agreement with the owner Merlone Geier promises the city millions in community benefit fees, as well as a commitment to construct the park, the retail space, the hotel, and at least four of a proposed five apartment complexes.

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NAMES IN THE NEWS

Four years ago, Newsweek—which is known for its annual ranking of colleges and universities—began ranking hospitals. Using patient satisfaction surveys, patient safety data, and quality treatment measures, Newsweek compiled a ranking of hospitals throughout the world. According to Newsweek Global Editor-in-Chief Nancy Cooper, the goal of this study was “to provide the best data-based comparison of hospital reputation and performance across countries.”

Recently, Newsweek announced that Providence Mission Hospital in Mission Viejo is the No. 1 Hospital in Orange County for the second year in a row, ranks as the No. 14 hospital in California, and was listed among the top 100 distinguished hospitals across the United States. Seth Teigen, Mission Hospital’s chief executive, explains that this ranking “means Mission Hospital provides safe, high-quality, and compassionate care for its patients and that, as a result, its patients report their hospital experiences were outstanding.”

Photo by Marion Butterfield

Newsweek Names Mission Hospital The No. 1 Hospital in Orange County

Senator Pat Bates Celebrates St. Paddy’s Day On March 24, state Senator Pat Bates held her 21st Annual St. Paddy’s Celebration at Hennessey’s Tavern in Dana Point. Senator Bates, who is termed out in the Senate, used the occasion to launch her campaign for Fifth District Supervisor. She is shown here with Matt Gunderson, a retired businessman who is seeking to succeed her in the state Senate, and Assemblymember Janet Nguyen.

Photo by www.istockphoto.com/ Vertigo3d

Judge Will Not Block Anaheim Stadium Deal In December 2019, the Anaheim City Council voted to sell Angel Stadium and 150 acres of surrounding property to SRB Management, a business partnership of Angels owner Arte Moreno, in exchange for $180 million in cash and $170 million in “community benefits,” including a seven-acre public park and homes for low-income residents. As a part of the deal, SRB Management committed the Angels to play in Anaheim through 2050.

But in 2020, Peoples Homeless Task Force Orange County filed a lawsuit challenging the agreement on the grounds that city leaders improperly made decisions behind closed doors, thereby shutting the public out of the process in violation of California’s Brown Act. However, in March 2022, Orange County Superior Court Judge David A. Hoffer issued a preliminary ruling in which he said that the way in which the city had handled the sale “substantially complied” with state laws for what can be discussed in closed city council meetings and that the discussions and decisions about the sale “were anything but secret and were fully vetted with the public.”

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Rex Hime Retires from CBPA In late March, Dirissy Doan represented Orange County REALTORS® at the California Business Properties Association (CBPA) Commercial Real Estate Industry Awards Dinner and 50th Anniversary Celebration, where she joined guests in congratulating Rex S. Hime on his retirement and thanking him for his thirty-seven years of service to the real estate industry as president and chief executive officer of CBPA.

NAMES IN THE NEWS Proposed HB Poseidon Desalination Plant Scheduled for Coastal Commission Hearing on May 12 The Huntington Beach Seawater Desalination Facility will be seeking its final regulatory permit before the California Coastal Commission on May 12 at 9:00 a.m. at the Costa Mesa Hilton, located at 3050 Bristol Street in Costa Mesa. If the Commission approves the project, Poseidon Water will be able to begin construction on this 50-million-gallon-perday project. Although the cost of this water is expected to increase rates by between $3 and $6 per month, there is an enormous benefit to having a reliable local water supply that is not dependent on either rainfall or snowpack.

Names in the News is intended to be primarily a place where REALTOR® and Affiliate members of Orange County REALTORS® can share both personal and professional news—about births (of children or grandchildren), graduations, weddings, anniversaries, accomplishments, awards, and other milestones—with one another. If you have news to share, email it to Orange County REALTORS® Writer and Editor Sherri Butterfield at Sherri@ocrealtors.org.

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LEADERSHIP ACADEMY

L E A D E R S H I P AC A D E MY A LU M N I :

WHERE ARE THEY NOW? The Orange County REALTORS® Leadership Academy was launched in 2016 because 2015 President Rita Tayenaka and other Directors saw a need for new blood in leadership roles at the Association level and decided to form an academy to train, grow, and nurture leaders. Now in its fifth year, the Leadership Academy has seventy-eight graduates. To give readers a better idea about what the Academy can to for members, we are featuring graduates in OC REALTOR®. To learn more about the Leadership Academy or to apply for the next class, visit www.ocrealtors.org/la.

What spurred you to apply for the Leadership Academy?

Orange County REALTORS® is such a great organization and has been a wonderful resource for me as I navigated through my first few years in the industry; therefore, I really wanted to give back to the community and volunteered as a member of the Grievance Committee a few years ago. It was there that I met the former Professional Standards Director, Vivian Vanderwerd, who told me about the Leadership Academy and encouraged me to apply the next time the opportunity presented itself. I’m glad that I took her advice!

What was the biggest thing you gained from participating in the Academy?

Often, real estate can be a lonely practice with each agent/broker focused on their own work. The Academy provided a great venue to break away from the day-to-day routine, and I felt I came out with a good mix of education, inspiration, and networking. The opportunity to brainstorm ideas and work on a real-life project with other motivated leaders makes us all better at what we do.

Where has your leadership journey taken you since graduation? What leadership roles have you obtained?

I ran for the OCR Board of Directors before graduating from the Academy and was pleasantly surprised and humbled to be elected. I've already served my first year and am currently serving my second year of a three-year term. This year I am also volunteering on the Finance Committee and the Bylaws Committee. I look forward to continuing to volunteer my time for the benefit of all our members. Besides, leadership is not limited to formal roles. Our clients expect us to lead them to a successful closing. As a business broker, I find that many of my clients who are the most appreciative of my efforts are the ones I had to coach and lead through challenging transactions. So, the skills and training from the Leadership Academy help in more ways than one!

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Graphics by: Ivan Salmeron

By Sabrina Blair DIRECTOR OF COMMUNICATIONS AND PROGRAMS

LEADERSHIP ACADEMY

Have you always been a natural leader or interested in leadership roles?

I have always been a natural leader; however, I felt that I could be a better leader and wanted the tools and technique to be that leader. I am a work in progress.

Where has your leadership journey taken you since graduation?

What leadership roles have you obtained?

Each person defines leadership differently. Some people think that standing in front of a room is leadership, and some people think that mentoring one person is leadership. The Academy put me on the path to defining what my role in leadership is, and there is not just “one role.”

I have gained the confidence to raise my hand even if I feel I am not the best; I will learn and grow with the role.

What advice or words of encouragement would you give to someone considering applying for the Academy?

The advice that I would give someone considering the Academy is to embrace the fellowship of the group. Meet privately, not to get business but to get to know that person and to build relationships.

What was the biggest thing you gained from participating in the Academy?

After graduation from the Academy, I definitely gained a lot of things, and the biggest one is the value of friendship—the great network that I have found from the Leadership Academy, together with the knowledge, and the self-confidence of what I can bring home to my organization.

Where has your leadership journey taken you since graduation?

What leadership roles have you obtained?

Right away I was told that I became a better person and a better president at my companies HPT Realty & Finance and Mainstream Escrow. At Orange County REALTORS®, I joined and served on the MLS Committee, Grievance Committee, and Global Business Committee. Then I joined AREAA Orange County Board of Directors in 2020 and became Vice President in 2021. The Certified Commercial Investment Member (CCIM) Southern California organization also invited me to join and serve on the board as the Sponsorship Chair at the beginning of 2022. I was most recently nominated to be the Founding President for Vietnamese National Association of Real Estate Professionals (VNARP) Southern California Chapter; and in a very short time, we formed a 26-member board of directors and hope to make a big impact on the community.

What advice or words of encouragement would you give to someone considering applying for the Academy?

I would strongly encourage everyone to apply and join the Academy as soon as possible. You will learn a lot to become a better person. Your dreams will come true if you know how to take the right actions to inspire people.

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LEADERSHIP ACADEMY What spurred you to apply for the Leadership Academy?

In 2017, I became involved with Young Professionals Network (YPN) and through that was directly introduced into the newly formed Global Business Alliance (GBA) Committee. As destiny would have it, I ended up being appointed as Chair of the GBA Committee the following calendar year. Because I was new to organized real estate and to Association leadership and governance, the Leadership Academy sounded like something that I needed to participate in.

Have you always been a natural leader or interested in leadership roles?

Absolutely not! For as long as I can remember, I have always been shy and introverted; however, improving myself in this area has been a work in progress. Now, I happily identify as an “extroverted introvert” —or maybe an “introverted extrovert." Those who know me, know that I love to share or give in any way that I can, especially in areas where I have subject-matter expertise, and have happily shared such knowledge and experiences internationally, whether live on stage or in virtual presentations.

Where has your leadership journey taken you since graduation?

What leadership roles have you obtained?

I have been fortunate enough to hold many leadership positions since my time in the Leadership Academy, including the following: Government-Appointed Team Leader, Invest in Dubai Trade Mission, Dubai Land Department, 2022 Vice President, International Real Estate Federation (FIABCI), Americas Committee, 2022 Member, International Real Estate Federation (FIABCI), USA Chapter, Events Committee, 2021 Founding President, International Real Estate Federation (FIABCI), USA Chapter, Los Angeles/Southern California Council, 2020–2021 Member, National Association of REALTORS®, Certified International Property Specialist Advisory Board, 2020 Co-Founder, REAL Estate Pros Without Borders, 2020 Chair, California Association of REALTORS® (C.A.R.), Global Real Estate Forum, 2020 Vice Chair, C.A.R., Global Real Estate Forum, 2019 Member, National Association of REALTORS® (NAR), Global Business and Alliances Committee, 2019 Chair, China Trade Mission (Shanghai and Beijing), hosted by Orange County REALTORS® and Las Vegas REALTORS®, 2019 Director, Orange County REALTORS®, 2019

W HAT GRA DUAT ES SAY A B OUT TH E L E AD E R S H IP ACAD EMY “Leadership is not limited to formal roles. Our clients expect us to lead them to a successful closing. So, the skills and training from the Leadership Academy help in more ways than one!”

—Vinil Ramchandran

“I have always been a natural leader; however, I felt that I could be a better leader and wanted the tools and technique to be that leader. I am a work in progress.”

— Ly n n C l a n c y

“I would strongly encourage everyone to apply and join the Academy as soon as possible. Your dreams will come true if you know how to take the right actions to inspire people.”

“Because I was new to organized real estate and to Association leadership and governance, the Leadership Academy sounded like something that I needed to participate in.”

—Mindy Luong

—Spencer Hoo

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MASTERMIND PRESIDENTS PANEL

The REALTOR® Party of California Recounts Its 2021 Legislative Successes

During 2021, the REALTOR® Party of California actively supported and shepherded legislation to address some of California’s most serious housing supply challenges, expand homeownership opportunities, and strengthen private property rights and fair housing.

We know that REALTORS® are stronger together. That’s why the REALTOR® Party transcends the political divide to focus on what matters most to all of us.

The REALTOR® Party is shaped by our members’ businesses and day-to-day lives, working to the advantage of REALTORS® and consumers. This past year, the California Association of REALTORS® Government Affairs Team made strides to improve homeownership opportunities, housing supply, and real estate practice in California.

The REALTOR® Party actively supported and shepherded legislation to address some of California’s most serious housing supply challenges, expand homeownership opportunities, and strengthen private property rights and fair housing.

• SB 7 (Atkins) expedites the development of urban infill housing.

• SB 8 (Skinner) extends the ability to accelerate the approval of housing projects consistent with local planning, zoning, and design.

• SB 9 (Atkins) expands homeowners’ ability to utilize their property to create two units on a property and, for those homeowners who commit to owning and occupying at least one of those units for three years, the power to split lots and build an additional two units. This latter provision is intended to help protect community character and commitment.

• SB 10 (Wiener) empowers local governments to choose to enact laws to streamline certain California Environmental Quality Act (CEQA) planning requirements to construct more development near specified public transit high-density areas.

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Photo by www.istockphoto.com/ SundryPhotography

STATE UPDATE

Photo by Marion Butterfield

STATE UPDATE

By Otto Catrina

CALIFORNIA ASSOCIATION OF REALTORS® 2022 PRESIDENT

The REALTOR® Party successfully advocated to safeguard and expand fair housing opportunities.

• AB 491 (Ward and Gonzalez) bans discrimination in mixed-income multi-family structures by providing all residents with the same access to common entrances, areas, and amenities.

• AB 571 (Mayes) eliminates duplicative costs when building low- and moderate-income housing units.

• SB 263 (Rubio) updates current fair housing training to be more robust and relevant, and requires real estate licensees to take implicit bias training as a part of their continuing education renewal requirements.

• AB 948 (Holden) helps prevent appraisals from being affected or influenced by illegal discriminatory factors.

• AB 1466 (McCarty) makes it easier to remove illegal discriminatory restrictive covenant language from deeds.

The REALTOR® Party is promoting intergenerational wealth opportunities.

AB 633 (Calderon) provides needed legal protections to ensure all parties receive a fair share of an inheritance and best value for inherited property when there are multiple heirs and no will or trust.

The REALTOR® Party protects your brand and business. AB 830 (Flora) allows REALTORS® who get married to change their names but still legally use their former surname to conduct business.

The REALTOR® Party successfully advocated to refine Proposition 19. Proposition 19 creates new benefits for homeowners who are 55 years of age or older, disabled, or victims of wildfire by removing unfair location and price restrictions and allowing them to transfer the tax base of their home to a new home anywhere in the state.

SB 539 (Hertzberg) provides clarifications to create consistency and certainty for the implementation of Proposition 19.

As your voice, the REALTOR® Party identified and stopped the harmful legislation that would have exacerbated the housing crisis.

• AB 255 (Muratsuchi), which would have effectively eliminated a small commercial property owner’s ability to evict for nonpayment.

• AB 854 (Lee), which would have forced property owners, even if they were losing money, to stay in the rental business for at least five years before using the Ellis Act to go out of business.

• AB 946 (Lee), which would have created housing instability by eliminating the state tax deduction for mortgage interest on second homes.

• AB 1188 (Wicks), which would have created unnecessary and burdensome rental registries throughout the state.

• AB 1199 (Gipson), which would have imposed an annual excise tax on rental housing providers.

• AB 1395 (Muratsuchi), which would have effectively shut down building, manufacturing, and transportation by revising the state’s climate goal mandate to reduce emissions to below 90 percent of 1990 levels by 2045.

• SB 12 (McGuire), which would have significantly stifled any new housing production in the wildland-urban interface.

The REALTOR® Party stands strong and more unified than ever—poised to wield the power of REALTORS® to advance policies in 2022 that benefit our communities, clients, and businesses.

This column is based on and has been excerpted from a flyer titled Spotlight on 2021 Legislative Successes, which was produced and distributed by the California REALTOR® Party in March 2022.

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COVER STORY

Four REALTORS® were recently chosen to serve three-year terms as 2023–2025 Directors of Orange County REALTORS®.

By Sherri Butterfield WRITER AND EDITOR Late spring is the time when Orange County REALTORS® elects new Directors.

Ordinarily, the process is one in which prospective candidates file applications and candidates’ statements in March. Then, if the Credentials Committee and the Board of Directors find that these candidates are qualified to serve, their names appear on the ballot for an election that takes place over a two-week period in mid-May. But this year, the process was different. The Association Bylaws provide that, if the number of candidates seeking positions on the Board matches the number of open positions, the Board may, at its discretion, declare that the candidates are Directors without conducting a formal election, and that is exactly what happened. There were four candidates for four open positions so the Board declared that Tony Faulkner, Chip McAllister, Charleen Nagata Newhouse, and Mary Rampone are officially Orange County REALTORS® Directors for the period from 2023 through 2025.

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COVER STORY

After earning a liberal arts degree from Metropolitan Community College, Tony joined the U.S. Marine Corps, where he spent fourteen years as an Air Wing Operations Chief, serving in Korea, Japan, and the Philippines. For a time, he was stationed stateside at Marine Corps Air Station El Toro and at Camp Pendleton. After spending seven more years in the U.S. Air Force Reserves, Tony is now a retired Tech Sergeant. Tony’s experiences at home and abroad have provided him with a unique perspective that has been helpful whether working with local or international clients.

A licensed broker, Tony directs the Aliso Viejo and Laguna Niguel offices of HomeSmart Evergreen Realty, where he supervises the efforts of 150 real estate agents, providing them with full-service support, which includes keeping them up to date on real estate law and providing Code of Ethics training. Tony is married and the proud father of five adult children. Active in the community, he is a trustee of the City of Laguna Hills, a member of the Marine Corps League in San Clemente, and a member of the Laguna Hills Chamber of Commerce.

For more than twenty-seven years, Tony has been a member of Orange County REALTORS®. He was a Director in 2011, has served on the Political Affairs and Elections Committee (PAEC) since 2018, and was committee chair in 2021– 2022. “In a successful organization, everything is connected,” Tony observes.

He wants to serve on the Board of Directors to learn how all the parts and pieces of the organization are interconnected so that he can contribute more meaningfully to its overall mission.

“In a successful organization, everything is connected.”

—Tony Faulkner

Chip McAllister is a graduate of the Orange County REALTORS® Leadership Academy and has served Orange County REALTORS® as a Director for the past three years. During 2020, he chaired the Education Committee, and he currently chairs the Leadership and Professional Development Committee.

When asked why he wanted to serve on the Board, Chip said, “I have a servant’s heart. I love the way in which Orange County REALTORS® has developed my leadership skills by allowing me to experience the Leadership Academy and to serve on the Board of Directors. Nothing gives me greater pleasure than edifying, encouraging, and supporting others to realize that, with proper training and thought process, they can live their lives without limits.”

“I have a servant’s heart. . . . Nothing gives me greater pleasure than edifying, encouraging, and supporting others to realize that, with proper training and thought process, they can live their lives without limits.”

—Chip McAllister OC REALTOR®

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COVER STORY

For twenty-four years, Charleen Nagata Newhouse has been a licensed REALTOR® and a member of Orange County REALTORS®. During that time, she has served on several OCR committees, including the Finance Committee, the Multiple Listing Service (MLS) Committee, and the Education Committee, and she was a Director for three years, from 2018 to 2021.

As part of the Realty One Group, Charleen started a mentoring program in which she educates and guides new agents in ways that help them build successful businesses. When Charleen is not working with clients or mentoring less experienced agents, she enjoys spending time with her family and her dog, a chocolate lab. For fun, she loves to travel and shop.

In seeking a position on the OCR Board of Directors, Charleen says that her goal is “to continue the great progress made by Orange County REALTORS® by teaching and instilling professionalism in current and future members.”

She believes that the Board has a duty and an opportunity to improve in the areas of education, ethics, oversight, and public image. She says that her views have always been clear: “Follow the rules, never stop learning, and never stop growing.”

“Follow the rules, never stop learning, and never stop growing.”

—Charleen Nagata Newhouse Mary Rampone earned a Bachelor of Arts in Economics from the University of California, Irvine. She has been a licensed real estate agent for five years and is a 2017 graduate of the Orange County REALTORS® Leadership Academy. Currently, Mary is an appointed Director of Orange County REALTORS®. She is serving a second term as chair of the Local Government Relations South Committee and is a member of the Global Business Alliance.

Mary says, “The biggest reward of being a REALTOR® is the ability to bless others. My active involvement in Orange County REALTORS® has given me that same satisfaction. The biggest takeaway from the Leadership Academy: To be a good leader, you must groom others to be leaders. It is my desire to work with the other Directors to provide the tools, education, and opportunities needed for our REALTOR® and Affiliate members to stand out and shine.”

Before working in real estate, Mary worked in the mortgage industry as a loan officer and underwriter and was a financial analyst in the defense industry. She is an Ambassador of the San Clemente Chamber of Commerce; a Homeowners’ Association delegate in Talega, San Clemente; and a Neighborhood Watch Captain.

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“The biggest reward of being a REALTOR® is the ability to bless others.”

—Mary Rampone

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HOMEOWNERSHIP

KEY EVENTS IN THE EVOLUTION OF

THE DREAM OF

HOMEOWNERSHIP Although the idea of the American Dream has evolved over a period of more than two hundred years, homeownership has always been one of its key components.

Graphics by: Ivan Salmeron

By Michelle McCann MARKETING AND PROGRAMS PROJECT MANAGER In 1931, James Truslow Adams coined the phrase “American Dream” in his book The Epic of America. As Adams described it, the dream was “of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement.” Although the idea of the American Dream has evolved, homeownership has always been one of its key components.

1785 Land Ordinance of 1785

President Thomas Jefferson believed that property ownership was a citizen’s right. He pushed for legislation that helped define property lines and a system of land purchase that became the basis for how real estate and ownership are described and transferred today.

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1789 Private Property Rights

The Fifth Amendment to the Constitution of the United States protects property rights. Slaves were considered property and had no property rights.

Women were not included among those with property rights, and military conquest, legislation, and court decisions often denied these rights to native Americans of African, Asian, and Latin-American descent.

1862 The Homestead Act

In 1862, President Abraham Lincoln signed into law the Homestead Act, which encouraged the settlement of the western portion of the United States by giving each American head-of-household the right to claim a homestead of 160 acres. Settlers had to pay a filing fee, complete five years of continuous residence, and be willing to build a home and farm the land. Citizens of all walks of life—including former slaves, women, and immigrants—had the opportunity to become landowners.

HOMEOWNERSHIP

1866 The Civil Rights Act of 1866

Following the Civil War, the Fourteenth Amendment to the U.S. Constitution declared that all persons born in the United States are citizens, and the Civil Rights Act of 1866 provided that all citizens have the same rights to real property as do white citizens. But in some instances, court cases, immigration laws, and racially defined zoning denied these rights.

1929 The Great Depression

In 1929, a housing crisis began as banks collapsed, millions of jobs were cut, and life savings were lost without federal deposit insurance. A quarter of the nation’s mortgages went into default. In 1940, the U.S. homeownership rate dropped to 50 percent, its lowest level of the century.

1934 Federal Housing Authority (FHA)

In 1934, the Federal Housing Authority (FHA) was formed to provide access to flexible mortgage financing. Before establishment of the FHA, mortgages required 50 percent down payments and terms were generally five or ten years with large balloon payments due at the end.

1938 Federal National Mortgage Association (Fannie Mae)

In 1938, the Federal National Mortgage Association (Fannie Mae) was formed to assist cash-starved banks. Fannie Mae buys mortgages from lenders, which allows banks to have more cash and fund more home loans. As a result, riskier borrowers, like low- and middle-income buyers, were given access to home loans.

1944 GI Bill of Rights

B ANK

GI Bill of Rights

In 1944, Congress passed the GI Bill of Rights. The GI Bill helped veterans pay for college and buy homes with a loan guarantee. The Veterans Administration (VA) still insures low- to zero-down payment loans for veterans, active-duty service members, and their spouses.

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HOMEOWNERSHIP

1968 Fair Housing Act

The Kerner Commission, studying the civil disorders and causes of riots in U.S. Cities in 1967, wrote, “Our nation is moving toward two societies, one black, one white—separate and unequal.” On April 4, 1968, Dr. Martin Luther King, Jr., was assassinated. On April 11, 1968, President Lyndon Johnson signed the Fair Housing Act into law. The Act states, “It is the policy of the United States to provide, within constitutional limitations, for fair housing throughout the United States.” The 1968 Fair Housing Act prohibited discrimination based on race, color, religion, and national origin. In 1974, the Fair Housing Act was amended to prohibit discrimination based on gender.

1970 1970: Federal Home Loan Mortgage Corporation (Freddie Mac)

In 1970, Freddie Mac was created to stabilize the nation’s mortgage markets and expand opportunities for homeownership by increasing the supply of money for mortgage lending.

2007 Housing Market Crashes

As a result of low interest rates and subprime lending practices during the early 2000s, market demand was high and home prices rose rapidly. In 2007, the credit bubble burst, and home prices plummeted. Foreclosures and short sales flooded the market. During the Great Recession, which lasted from December 2007 until June 2009, approximately 3 million homes were lost to foreclosure, and housing prices fell more than 30 percent.

HOMEOWNERSHIP TODAY

Low interest rates during the COVID-19 pandemic created an increase in homebuying and strained the availability of homes. As sales boomed, median home sale prices surged. Although most Americans still dream of owning a home, a 2021 survey found that 70 percent of Americans said young adults today have a harder time buying a home than their parents’ generation did.

Note: Much of the text for this article is based on, or has been excerpted from, the National Association of REALTORS® (NAR) fair housing timeline, which can be found at https://www.nar.realtor/fair-housing-act/fair-housing-makes-us-stronger-commemorating-50-years-ofthe-fair-housing-act/fair-housing-and-property-rights-a-history.

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FIVE REASONS

to Sell in Today's

Insane Market It’s a seller’s market. You hold the power right now, and you don’t want to miss your opportunity to capitalize on it.

By Sabrina Blair DIRECTOR OF COMMUNICATIONS AND PROGRAMS In this insane market, it can be scary to think about selling your house. Many homeowners would say, “I can make a lot of money if I sell now, but where am I going to live if there’s no inventory?” Well, I’m here to convince you not to worry! It’s a seller’s market. That means you hold the power right now, and you don’t want to miss your opportunity to capitalize on it. Here are five reasons to sell in today’s insane market.

1.

Interest rates are only going to go up, up, up.

As Steven Thomas mentions in his article in this issue of OC REALTOR®, interest rates have jumped a staggering 45 percent in the first quarter of the year.

Rates went from 3.31 percent on December 29, 2021, to 4.8 percent at the end of March! That upward trend is expected to continue, so if you are thinking of selling and buying another property, you want to get in before the rates rise further and diminish your buying power.

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2.

Demand is still hot.

Although interest rates have been rising, there is still a large pool of buyers out there, but that pool will likely shrink as rates increase. For some buyers, preapproval amounts will diminish to the point where they can no longer afford what they want. This will lead some buyers to sit on the sidelines for a while in the hope that either prices or interest rates will drop.

As a seller, you want to take advantage of the larger buyer pool because having more potential buyers usually means receiving more offers, and more offers will drive up your sale price.

“Because it is a seller’s market, you have the upper hand in the transaction.

”

HOMEOWNERSHIP

“Many buyers are willing ”

PROFIT

3.

Because it is a seller’s market, you have the upper hand in the transaction. This means that, if you ask for a 30-day rentback at no cost, you will most likely get it—or even more. If you are worried about requests or credits for repairs, now is the time to sell.

Many buyers are willing to overlook needed repairs and buy as-is to get into the housing market while they can.

“No one can predict with

100 percent certainty what the housing market will do in the future, but you don’t want to find yourself in a different market wishing you had taken advantage of today’s hot seller’s market.

”

You can maximize your profit.

Graphics by: Ivan Salmeron

4.

Sellers are in the driver’s seat.

Photos: www.istockphot.com/sommart

to overlook needed repairs and buy as-is to get into the housing market while they can.

At some point, home prices are going to plateau because interest rates have gone up too high and buyers can no longer afford what they could previously. For this reason, you should sell now and maximize your profit. You can take those proceeds and buy your next property whether you are looking to upsize, downsize, or even move out of the area.

5.

You won’t have homeowner’s remorse.

No one can predict with 100 percent certainty what the housing market will do in the future, but you don’t want to find yourself in a different market wishing you had taken advantage of today’s hot seller’s market. Could prices continue to climb? Maybe. Could prices plateau or drop? Maybe. If prices do drop though, you could be leaving tens if not hundreds of thousands of dollars on the table. Those dollars could help you buy your dream house, build or renovate your dream house, pay off your debts, or even retire!

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HOMEOWNERSHIP

According to the 2020 Annual Report by the Department of Fair Employment and Housing, discrimination because of disabilities is the most common complaint in fair housing.

Homeownership has many benefits.

For example, it provides a sense of financial security and emotional stability, offers tax advantages and increased access to credit, and creates a feeling of community belonging.

But homeownership has additional benefits if you are a person living with a disability: you can make home modifications without having to wait for approval from a landlord or the housing authority, and you can have an overall feeling of independence and self-reliance.

Many persons with disabilities face challenges that make the dream of owning a home more difficult to achieve. Receiving Social Security Disability Insurance (SSDI) or Supplemental Security Insurance (SSI) can seem like a financial challenge when considering a home purchase, but receiving benefits does not prevent individuals from purchasing a home.

There are loans and programs available specifically to help the disabled, and the federal Fair Housing Act makes it illegal for lenders to discriminate against people with disabilities.

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National Programs that Offer Help National programs that offer homeownership help to persons with disabilities include the following: HomeReady Mortgages from Fannie Mae Fannie Mae's HomeReady mortgage program can be an attractive option for those receiving disability benefits because of the program's flexible requirements. (https://singlefamily.fanniemae.com/originatingunderwriting/mortgage-products/homeready-mortgage) Department of Veterans Affairs (VA) Loans The Department of Veterans Affairs (VA) offers home loans to eligible service members and veterans, including those who have sustained service-connected disabilities. (https://www.benefits.va.gov/ homeloans/) HUD Housing Choice Vouchers Under what’s commonly known as the Section 8 program, disabled individuals may be allowed to use their housing vouchers, which are typically used to subsidize rent payments, to help cover mortgage payments and other costs of maintaining a home. (https://www.hud. gov/topics/housing_choice_voucher_program_section_8) Habitat for Humanity The international charitable organization Habitat for Humanity offers homes to individuals in need of safe, affordable housing, typically in exchange for partnering with the organization. (https://www.habitat.org/housing-help/apply) Homes for Our Troops Homes for Our Troops is a nonprofit that builds and adapts homes and then donates them mortgage-free to service members who were injured on duty after September 11, 2001. (https://www.hfotusa.org/help/)

Photo: www.istockphoto.com/SolStock

By Michelle McCann MARKETING AND PROGRAMS PROJECT MANAGER

HOMEOWNERSHIP

Accessibility Challenges

Renovation Challenges

For buyers with physical disabilities, touring potential homes, the financing and closing stages, and finding a home with modifications in place can present challenges during the buying process; however, the Fair Housing Act ensures that all homebuyers have equal access to real estate offices, information, properties, and programs.

Most homes are not built to accommodate the needs of individuals living with disabilities. To live independently and enjoy being a homeowner, persons with disabilities may need to adjust their surroundings by remodeling or renovating, but renovating a new home can be a financial challenge. The good news is that contractors, lenders, and REALTORS® are becoming more familiar with what is needed to fund a remodeling project, and programs are available to assist:

Homes that are wheelchair accessible, do not have entrance steps, or are built with wider doorways or lowered kitchen surfaces can be hard to find or come with additional costs to buyers who need these modifications to live comfortably.

Even touring a home without modifications like a wheelchair ramp can be tough, and REALTORS® should find safe and convenient ways for all clients to gain access to properties.

During the financing and closing stages of home buying, other types of accommodations may be necessary. Hearing-impaired clients may need access to pen and paper or translating services.

Visually impaired clients may ask to receive virtual documents ahead of time or that they be scanned into a reader or ask that a guide dog accompany them to open houses and meetings.

Whatever the limitation, REALTORS® should make certain that all clients receive appropriate accommodations during each part of the home-buying process.

Many persons with disabilities face challenges that make the dream of owning a home more difficult to achieve.

The USDA has grants and loans to make accessibility improvements easier through the Single Family Housing Loans & Grants Program. (https://www. rd.usda.gov/programs-services/single-family-housingprograms/single-family-housing-repair-loans-grants) The Ability Center Home Accessibility Program provides loans to individuals who need to have accessibility renovations, such as ramps, low-rise steps, stairlifts, or grab bars installed in their homes. (https://www.abilitycenter.org/programs/homeaccessibility/)

Discrimination Challenges The Fair Housing Act (FHA) and the Americans with Disabilities Act (ADA) are in place to ensure that individuals with disabilities have equal access to homebuying opportunities. According to the 2020 Annual Report by the Department of Fair Employment and Housing, discrimination because of disabilities is the most common complaint in fair housing.

If the rights of a home buyer have been violated, file a complaint with the U.S. Department of Housing and Urban Devolvement (HUD) at https://www.hud. gov/program_offices/fair_housing_equal_opp/ online-complaint or with California Fair Housing and Employment at https://www.dfeh.ca.gov/housing/.

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THE ORANGE COUNTY HOUSING UPDATE

When Will The

Since the beginning of the New Year, housing has been hot despite rising mortgage rates, but a market downshift could be coming.

By Steven Thomas REPORTSONHOUSING.COM Steven Thomas has a degree in quantitative economics and decision sciences from the University of California, San Diego, and more than twenty years of experience in real estate. His bimonthly Orange County Housing Report is available by subscription and provides housing market analysis that is easy to understand and useful in setting the expectations of both buyers and sellers. His website is www.ReportsOnHousing.com.

Today’s society is accustomed to getting information immediately and from a variety of sources. No one must wait for the morning paper or the evening news to learn what’s going on. Everything can be found on the web and on a smartphone in an instant. The Wall Street Journal, CNBC, MSNBC, FOX, CNN, CBS, ABC, BBC, and countless other websites allow everyone to be plugged in all the time.

A new trend has emerged this year: rising interest rates. According to the Mortgage Bankers Association®, 30-year fixed rates have risen from 3.31 percent on December 29, 2021, to 4.8 percent on March 31, 2022, a 45 percent increase during the first quarter of the year. Yet, the housing market remains white hot.

News is reported live twenty-four hours a day, seven days a week. When a bad earnings report for a company is announced, the company stock drops in an instant. If the Consumer Price Index (inflation) rises a lot higher than estimates, the Dow, S&P 500, and Nasdaq all plummet immediately. Yet, changes in the housing market are far from instant.

“In housing, new trends

The housing market does not change quickly. Instead, it evolves over time. Houses are not traded on Wall Street.

They are not stocks that are easily bought and sold.

Instead, they are homes, a place to rest, relax, and unwind, a place to start or raise a family. Everyone needs shelter and must live somewhere. In housing, new trends slowly shift the tide and eventually reveal a change in the market.

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slowly shift the tide and eventually reveal a change in the market.”

In fact, at the beginning of April, the Expected Market Time in Orange County (the time between pounding in the For Sale sign and opening escrow) was hovering around 20 days, just one day more than the all-time low of 19 days reached at the beginning of March.

The market is extremely hot because not enough homeowners are placing their homes on the market and very few homes are for sale.

THE ORANGE COUNTY HOUSING UPDATE

In 2013, interest rates increased from 3.34 percent in January to 4.5 percent in September. As demand weakened, overpriced listings sat on the market, allowing the home inventory to increase. With supply rising and demand muted, the overall speed of the market slowed, and Expected Market Times climbed. For the market to experience a similar shift in 2022, mortgage rates must persist above 4.5 percent. If that occurs, as more homes come on the market throughout the spring and summer, demand will be muted, and the inventory will climb as overpriced homes accumulate.

As of April 1, there were only 1,552 homes available to purchase in Orange County, the lowest number since tracking began eighteen years ago. Last year there were 2,368 missing For Sale signs in Orange County, 6 percent less than the three-year average between 2017 to 2019.

Yet, during the first three months of 2022, there were 1,866 missing signs.

But as more homes came on the market during the spring, the number of available homes began to rise substantially for the first time in nearly two years, growing from 3,183 in March to 4,423 by mid-June, adding 1,240 homes, up 39 percent. At the same time, mortgage rates had climbed to 3.93 percent.

The limited number of homes coming on the market has substantially impacted the ability of the active inventory to rise. Even with higher rates, there are still plenty of buyers bumping into each other at open houses and property showings, eagerly waiting for more homes to enter the fray.

The inventory continued to grow through the Summer and Autumn Markets and did not peak until mid-October at 6,350 homes.

A typical peak occurs during the summer between July and August. From March to October the number of available homes had almost doubled, from 3,183 to 6,350, an increase of 3,167 homes. The Expected Market Time slowed from 33 to 82 days, and mortgage rates surpassed 4.5 percent in September before retreating to 4.23 percent by mid-October.

The trend in rising rates has occurred before and eventually led to a market change in 2013, when there was similarly a very limited supply of available homes to purchase. Much like today, the Expected Market Time dropped, and the market got hotter at the beginning of the year. It declined from 47 days in January to 33 days by mid-March. At the same time, mortgage rates rose from 3.34 percent to 3.63 percent, yet the market just got hotter.

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THE ORANGE COUNTY HOUSING UPDATE

The fundamental trend of persistent rising rates from 3.34 percent at the start of 2013 to 4.5 percent in September paved the way for a shift in the market from an Insane Seller’s Market to a Slight Seller’s Market.

Demand downshifted because of climbing rates. With a bit less demand, overpriced listings sat on the market and accumulated over time, allowing for the inventory of available homes to increase. With supply increasing and demand muted, the overall speed of the market slowed, and Expected Market Times climbed.

For the market in 2022 to experience a similar shift, mortgage rates cannot drop substantially. Instead, they must persist at these higher levels, above 4.5 percent. If that occurs, as more homes come on the market throughout the spring and summer, demand will be muted, and the inventory will methodically climb for the first time in three years as overpriced homes accumulate.

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Last year, mortgage rates started the year at 2.65 percent and climbed to 3.18 percent by April 1, up a little over a half a percent. The rise was short-lived as mortgage rates dropped back down to 3 percent by the end of April and to 2.77 percent in August. Rising rates did not persist, and the Insanely Hot Seller’s Market could not be stopped.

The Orange County housing market has been below forty days since August 2020. At these levels, there are a ton of showings, sellers get to call all the shots during the negotiating process, multiple offers are the norm, and home values are rising rapidly.

Only higher rates can slow the housing freight train that has been barreling down the tracks for nearly two years.

NOTE: Even with a market shift, it will continue to be a Hot Seller’s Market. This is not a shift to a Buyer’s Market. This is a shift from a housing market that is out of control, appreciating more than 1 percent per month, to a regular Hot Seller’s Market with a normal appreciation rate of 4 to 5 percent per year.

Sellers who overprice will sit and languish on the market.

“Only higher rates can slow the housing freight train that has been barreling down the tracks for nearly two years.”

MEMBERSHIP

After two years of pandemic social distancing and meeting via Zoom, Orange County REALTORS® held its 2022 Annual Membership Meeting and Market Forecast in person at the UCI Student Center on March 21. OC REALTORS® President-Elect Scott White opened the meeting, led the Pledge of Allegiance, and introduced OC REALTORS® President Adam Rodell. Adam acted as master of ceremonies and introduced the featured speakers, whose remarks are summarized below.

Art Carter

CEO, CALIFORNIA REGIONAL MULTIPLE LISTING SERVICE

MLS Industry Update

Orange County REALTORS® have put 7,700 listings into the CRMLS system. Although 926 possible violations have been looked at, the majority do not have any actions on them. Listing compliance is important not only for your fellow REALTORS® but also for the consumer.

A lot of litigation is going on right now, and a big chunk of it has to do with commissions—who gets paid how much and by whom.

You have heard it said that all real estate is local, but all technology is not.

The Department of Justice does not believe that real estate has been sufficiently transformed by technology and is, therefore, not sufficiently competitive.

Otto Catrina

“ Ultimately, Orange County REALTORS® is an Association of people.”

—Adam Rodell

C.A.R. 2022 PRESIDENT

California Association of REALTORS® Update

Our Leadership Team just got back from Washington, D.C. The purpose of our trip was to focus on housing—lack of affordability and lack of supply.

In California, only 25 percent of qualified people can purchase a home, and existing home sales are down about 8.3 percent year to date. We need to be more strategic when we talk about housing. The purpose of the REALTOR® Party is to speak with one voice to advance public policies and candidates that promote a vibrant living environment.

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Photos by Marion Butterfield

Orange County REALTORS® is the largest trade association in the state and ranks twelfth in the nation. Housing is on solid ground. Rising rents during inflationary times have provided support for home prices; but expect home sales to come down nationwide as the Federal Reserve raises the interest rate to curb inflation.

MEMBERSHIP

Joyce Endo

Photos by Marion Butterfield

Shannon King

NAR VICE PRESIDENT OF ASSOCIATION OF AFFAIRS

OCR TREASURER

National Association of REALTORS® Update

Our Association’s finances are sound and in compliance with NAR’s accounting standards. As of December 31, 2021, our net assets are $11,637,000. These assets include $10.8 million in cash on hand and $472,000 in fixed assets, including our Laguna Hills Headquarters.

Income and Reserves. Each year, the Association Directors and the Finance Committee manage approximately $12 million in revenue, collected from dues, Multiple Listing Service (MLS) fees, our REALTOR® Store, investment income, and through revenue shares. We have $4.7 million in reserves, which represents eight months of operating expenses.

Contributions. Our members continue to donate generously.

OCAR Cares, our member relief fund, receives approximately $40,000 in direct donations each year, and the fund balance is currently $225,000. During the recent membership renewal period, members made voluntary contributions to the state-run REALTOR® Action Fund (RAF), which is used to support political candidates and to advance legislative policies that are REALTOR®friendly. Through the 2022 dues checkoff, members contributed close to $19,000 to C.A.R.’s Housing Affordability Fund (HAF), which supports local housing and community development programs.

Membership. Our Association added primary members at a growth rate of 6 percent in 2021. Although we lost 50 percent of our Affiliates during the pandemic, they are coming back at a record 85 percent renewal rate, our highest ever. Orange County REALTORS® ended 2021 with 14,909 primary REALTOR® members, leaving it ranked twelfth in the nation and first in the state.

With 1.6 million members, the National Association of REALTORS® is the largest trade association in the world. It is our mission to make sure that you find value in what we do. We emphasize strength, safety, and sustainability. We offer courses covering fair housing, implicit bias, and diversity, equity, and inclusion. We provide REALTORS® with an opportunity to renew their commitment to excellence by earning the Commitment to Excellence (C2EX) endorsement. And we offer the Center for Financial Wellness, which is a fantastic resource for people who are self-employed and must provide for their own retirement.

Lawrence Yun

NAR CHIEF ECONOMIST AND SENIOR VICE PRESIDENT OF RESEARCH

Orange County REALTORS® Financial Report

Economic Forecast

We are experiencing the highest inflation we have seen in forty years. To curb inflation, the Federal Reserve may aggressively raise interest rates four to seven times this year. The problems in real estate are price and availability. Real estate tends to be a very good hedge against consumer price inflation. Rising rents during inflationary times provide support for home prices. High home prices are good news for homeowners but terrible news for would-be home buyers. We need to consider how to create more housing supply.

2022 Forecast. Housing is on solid ground.

Nationwide, home sales will come down because of higher mortgage interest rates, but rising rents during inflationary times have provided support for home prices.

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OC REALTOR®

Adam Rodell OCR PRESIDENT

Orange County REALTORS® Association Update Founded in 1953, Orange County REALTORS® offers a great member-value proposition. It is affiliated with the National Association of REALTORS®, the largest trade association in the world; with the California Association of REALTORS®, the largest trade association in the United States; and with the California Regional Multiple Listing Service, the largest Multiple Listing Service system in the country with more than 100,000 subscribers. But ultimately, Orange County REALTORS® is an Association of people.

MENTIONS

Really enjoyed having President Adam Rodell at our Marketing Meeting North. Attendees appreciated his three-point plan, or Areas of Focus, for 2022:

1.

To help all members of Orange County REALTORS® increase business production by supporting one another;

2.

To promote the opportunity to participate in the Leadership Academy (with examples of future growth and involvement in OCR committees), and

3.

To promote the growth of Diversity and Inclusion.

Truly appreciated the connection with the thirty or so attendees in the room and am hoping for another visit to our meeting in the future.

A motivating and inspiring presentation.

Thank you.

Photo: www.istockphoto.com/mattjeacock

Bryan K. Ahn Director and Regional Sales Manager, New Wave Lending Group – Wholesale

EDITOR’S NOTE: For additional information about the Orange County REALTORS® Leadership Academy, see the interview by Sabrina Blair, OCR Director of Communications and Programs, with Academy graduates, which appears on pages 14–16 in this issue of OC REALTOR®.

CALL FOR MENTIONS Media postings and emails intended for possible publication in this magazine should be sent either to Director of Programs and Communications Sabrina Blair at Sabrina@ocrealtors.org or to Writer and Editor Sherri Butterfield at Sherri@ocrealtors.org. All written material may be edited for content, length, or style and may appear either online or in print. Emails become the property of Orange County REALTORS®. Although some may be answered, none will be returned.

Photo: www.istockphoto.com/JONGHO SHIN

A Motivating and Inspiring Presentation