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BEST OF Legal hotline What to do if you find yourself managing a property.

homeownership matters Why home ownership is still a vital part of American communities.

MAGAZINE

December 2010 $5.00

stand out crowd how to

from the


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table of contents

december

features How to Stand Out from the Crowd

9

Home Ownership Matters

16

Amendment to Article 10

10

What sets you apart may be your ticket to getting noticed and gaining business.

Why home ownership still matters to American communities.

How cooperative efforts extended Article 10 protections to those in the gay, lesbian, bi-sexual and transgender communities.

From Blue to Red Republicans swept top-ticket races in 2010, turning Wisconsin from blue to red.

WRA Distance

Learning

Continuing EducationOn Demand

Key Features

vol.

27, no. 3

articles

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22

2010 |

Notes Tool Take notes while you watch your videos.

14 17 24

26

Legal Hotline: The Accidental Property Manager

What you need to know if you find yourself managing a property.

There’s a Form for That WRA forms to help with everyday issues in your business.

Sales Tip: Checklists for Success Checklists can ensure that everything runs smoothly from contract to closing.

Facing Budget Realities Wisconsin legislators must set a new course for economic recovery and job growth. Are they up to the challenge?

Public Land in Wisconsin: How Much Is Enough? An overview of Wisconsin’s Stewardship Program and why it may be affected come January.

Register Today!

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News

editor’s NOTE

G

reetings . This month brings a change to

the magazine, something that came about when Bill and I sat down to write his December column and realized we needed to freshen things up and give you more content and less commentary. So here’s our plan: Bill will continue his column in a streamlined version (look for it next month alongside John Horning’s Chairman’s Corner) and I’ll walk you through the magazine in the Editor’s Note. Our goal is for each of us to write about what we know best: the president on the WRA, the editor on the magazine. Who am I? My name is Vanessa and I’m WRA’s editor. Each month, along with our Senior Designer, Joe Leschisin, I manage the magazine articles (and sometimes write them), keep us on schedule and within budget, and ultimately work to bring you stories, tips and information you’ll find useful in your business. Right now we’re busy lining up topics for 2011. You may have seen the survey we sent asking for your feedback on the magazine. We want to know: Are we addressing topics that interest you? Could we be covering other things? How have you used WRA content successfully in your business? A publication is only as good as its relevance to its readers, so please continue to send us your feedback. We had fun putting together this month’s issue (quicker than usual, given the Thanksgiving holiday!) and I hope you’ll enjoy the results: a mix of legal and policy updates with hands-on, practical business advice.

As WRA’s editor, Vanessa oversees content for WRA’s online and print publications.

Be sure to check out Debbi Conrad’s piece on NAR’s homeownership campaign helping you counter the recent backlash against homeownership (page 9); a rundown of the top 5 WRA forms and their uses from Cori Lamont (page 14); our feature story from Bob Corcoran on ways to stand out from the competition (page 4); Marcus Wally’s Sales Tip on creating great checklists for buyers and sellers (page 17); and a product showcase on two exciting new products: broker pre-license on demand and monthly housing statistics (page 28). And don’t forget to visit the education section on pages 18-21 for upcoming courses and details on Designation Week, which runs February 8-11, 2011. There’s still time to qualify for a scholarship! Visit http://wra.org/GRIscholarship for details. In closing, I look forward to hearing from you on how we’re doing and how we can improve.

Enjoy the read,

Vanessa merina@wra.org 608-241-2047, ext. 272

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Real Estate

Wisconsin Real Estate Magazine™ is published by the WISCONSIN REALTORS® ASSOCIATION. Trademark issued pursuant to Wisconsin state statute; federal trademark is pending.

notes from the wra

John Horning, Chairman jphorning@shorewest.com

WRA General Membership Meeting

Robert Keefe, Chairman-Elect rkeefe@keeferealestate.com

WRA Holiday Hours

WRA members are invited to attend the WRA’s General Membership meeting.

Renny Diedrich, Treasurer rdiedrich@coldwellhomes.com William E. Malkasian, cae, President wem@wra.org Editorial Staff:

WHEN:

Friday, January 21, 2011

WHERE:

WRA Headquarters – Education Center

4801 Forest Run Road

Madison, Wisconsin

The WRA holiday hours are as follows:

AGENDA:

I. Call to Order – John Horning, Chairman of the Board

William E. Malkasian

II. Association Issues

Publisher

III. Adjournment

For more information, call Sandy Bolgrihn at 608-241-2047 or 800-279-1972.

Robert Uhrina

Thursday, December 23 – closed at noon Friday, December 24 – closed Thursday, December 30 – closed at noon Friday, December 31 – closed Happy Holidays to all of our members!

Managing Editor

WRA Nominating Committee Seeks Candidates

Vanessa Merina Publication Editor

Are you interested in serving in a leadership role for your state association? The WRA Nominating Committee is seeking candidates for the positions of 2011-2012 Chairman-elect and Treasurer. Applications are available fromthe WRA website or by contacting Sandy Bolgrihn at sandyb@wra.org. The deadline for submitting an applicationis December 31, 2010.

Joe Leschisin Senior Designer Wisconsin Real Estate Magazine, USPS 597-850, ISSN 1548-0526, is published monthly by the WISCONSIN REALTORS® ASSOCIATION, 4801 Forest Run Road, Ste. 201, Madison, WI 53704. Periodical postage paid in Madison, WI and additional mailing offices. An annual subscription rate of $5 is included in membership dues and a copy is mailed to every paid REALTOR® and affiliate member of the association. Nonmember subscription rate: $60. POSTMASTER: please send address changes to the WISCONSIN REALTORS® ASSOCIATION, 4801 Forest Run Rd., Ste. 201, Madison WI 53704-7337.

In addition, the Nominating Committee is seeking applications for the positions of 2011-2010 Executive Committee Vice President, NAR Director and WRA Board of Director Regional Representative (note: the number ofopenings for Regional Representative is determined by the membership as of February 28, 2011). The applicationdeadline is March 15, 2011.

Health Reform Changes Begin to Take Effect

Permission to reprint or quote any material from this issue is hereby granted, provided the Wisconsin Real Estate Magazine is given proper credit in all articles or commentaries, and the WISCONSIN REALTORS® ASSOCIATION is provided with a copy of any reprint.

The Affordable Care Act legislation was signed on March 23, 2010, and is scheduled to be phased in over eight years. Some of the provisions take effect six months after signing, thus those reforms are now being implemented. When and whether these changes affect your health insurance plan depends on several factors, including whether you are insured on the same plan that covered you on March 23, 2010; the renewal date of your plan; and any changes you have made to your health plan. Following are the major provisions, effective beginning in 2010:

Advertising of third party products and services herein does not imply endorsement by the WRA unless specifically stated. Furthermore, the WRA does not endorse, approve, or otherwise warrant the accuracy or legality of any information or content contained in advertisements. Any questions regarding advertising policies should be directed toward the editor.

Contact Us: 4801 Forest Run Rd., Suite 201 Madison, WI, 53704-7337 (608) 241-2047 • (800) 279-1972 legal hotline: (608) 242-2296 • (800) 799-4468 general fax: (608) 241-2901 products/education fax: (608) 241-5168 legal hotline fax: (608) 242-2279

facebook: www.facebook.com/wisconsinrealtors twitter: www.twitter.com/wirealtors linked-in: www.wra.org/linkedin youtube: www.wra.org/youtube

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Elimination of pre-existing condition limitations for children under age 19

Children are allowed to stay on a family policy until age 26 if they are not eligible for employer coverage

Employers who contribute to a health plan for their employees are eligible for a tax credit of up to 35% if they have no more than 25

december 2010

full-time employees and the average wages are less than $50,000 •

Lifetime limits are eliminated and annual limits are restricted on ‘essential benefits’

Expanded state high-risk pools are available, but you must have been uninsured for at least 6 months to be eligible

The multitude of reform provisions contained in the Affordable Care Act is complicated, but WRA has partnered with REGIT, Inc., an insurance broker who has been serving REALTORS® for over 50 years, to help sort out the changes. The licensed professionals at REGIT are knowledgeable about the reform provisions. They are more than an insurance broker to our members – they are a resource whom members can call upon for advice even if you are not in the market for an insurance product. Whether you need information on how the new law impacts you or you want to compare your current plan against the new “reform-ready” medical plans available in the marketplace, we encourage you to contact REGIT. Call Lorraine Allen or Donna Freestate at 800.537.9786 or send your question via email to regit@regitinc.com.

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stand out crowd how to

By Bob Corcoran

from the

“It is better to be looked over than overlooked.” –Mae West If anyone knew how to get looked over instead of overlooked, it was the 20th century actress Mae West (for you younger REALTORS®, think Angelina Jolie).

W

est crafted a persona (a brand) that has stood the test of time. Even though she died in 1980, her name remains synonymous with distinction. She was the consummate brand builder, long before brand building was on the radar. In short, she knew how to stand out from the crowd. One of West’s signature tools was the feather boa she wore around her neck like a scarf. Viewers knew her instantly just by her look. In fact, there’s an official naval flotation device worn around the neck named for Mae West. That’s how effective that one piece of clothing became for her. And today, even 30 years after her death, West can still give us lessons in how to get looked over, especially REALTORS® who so often and so easily get lost in the crowd among all the real estate professionals out there. I’d like for you to consider your own feather boa – your

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device for getting noticed (and chosen) for business. To do that, I’d like to share a few tips that can help you stand out enough to make even Mae West proud.

1.Survey your landscape. Mae West knew she was just one of hundreds of other actresses and that it’d be easy to get lost in the scenery with all those other beauties. So she had to consider the landscape and come up with something that would not only make her rise to the surface, but also get noticed. So what’s your landscape look like? Step back and take a good long look at what’s going on in your particular market. Forget what the national news is. Zero in on your area and the key neighborhoods where you work. What do people in your market consider important when it comes to real estate? What matters to them? Also, find out what other REALTORS® are not doing or not willing to do, then do it with reckless abandon. news.wra.org


Look at businesses in other industries that have carved out a niche to become leaders. Consider Amazon.com. There are online retailers everywhere these days, but how many make shopping as easy and personalized as Amazon? Not many. What is it in your community that’s begging to be done for your potential clients? Find it and use it!

2. Get seen. Here’s a news flash: If you want to be seen as standing out from other REALTORS®, guess what? You have to get seen in the first place. How do you do that? Well, your advertising is one obvious (and likely well-used) tactic, but another tool many REALTORS® often overlook is public relations. Take this next sentence to heart and it could put you in the spotlight for the rest of your career: Learn how to become a resource to reporters. You can stand head and shoulders above the rest of the REALTORS® who are shipping out sloppy and selfpromotional press releases by simply being a resource. Here’s an example. Suppose NBC Nightly News reports on housing prices. The newspaper in your town needs to localize this story. The reporter who covers real estate needs a local REALTOR® who can talk about housing prices in Wisconsin. Who might that be? You, of course! The reporter interviews you and you become the local expert. Free of charge! Take the time to get to know reporters and let them understand that you can share insight into area housing prices, neighborhood issues, property rights and all the other items related real estate.

3. Communicate. To get seen, you don’t have to always rely on a thirdparty media outlet. Today, it’s easier than ever to create your own media outlet. The Internet has made it possible to be your own publishing company with blogs, websites and e-newsletters; your own radio station with podcasting; even your own TV station via sites like YouTube. I’m a big proponent of all these items and I encourage you to use what feels comfortable. Something I like to see REALTORS® do is send out satisfaction questionnaires to recent clients. Just the fact that you send such a questionnaire says a lot; it tells the receiver that you care. Keep it simple and ask for a sentence or two about what they liked and didn’t like and any suggestions for improvement. Also, remember handwritten thank you notes – sadly, something of an endangered species these days. How often do you get anything handwritten in the mail, much less from someone in business? Imagine the wisconsin real estate magazine

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client who finds your thank-you note among all the generic trash. Talk about standing out in a crowd. Always have a stack of thank-you notes handy and take a few minutes each day to send a few out.

And it works for the bottom line. Why do the large conglomerates talk about their community service? Because it sells. It’s proven people like to do business with good companies (and good people).

And consider a newsletter for your area of expertise. But make sure the information is useful. You can complement local papers with news of what the city council is doing related to real estate, school news, police reports and new ordinances. Do that and people will not only read it, they’ll also appreciate and respect you. They could even begin to see you as the real estate expert you are!

And besides, giving back to your community feels good. Why? I believe (and I know many REALTORS® agree) that the good life is determined by what we give in this world, not what we get. That said, I would add that you can be thoughtful in what you choose to give back to. There are so many choices: volunteering at schools, giving scholarships, serving food at a homeless shelter, sponsoring a soccer team, the list goes on and on.

4. Be consistent. Like it or not, you have to compete with hundreds of other marketing messages consumers get peppered with every day. To break through the clutter, it’s imperative that you “look like you” every time potential clients see your messages. Mae West understood this rule of consistency through her feathered boas. Take time to really define who you are in your market place and build a crystal-clear sense of what you can offer your consumers. When I visit agents for the first time, I like to get to know them and learn who they are as people first before we discuss their business. I want to know what their strengths and weaknesses are; what they feel confident about and what makes them worry. All this helps to build their own personal brand in the marketplace – a brand they can feel comfortable with day in and day out. Building on something that’s not comfortable won’t work in the long run. I believe success starts with who a person truly is. Everything grows from that point forward. After examining and defining your brand in your marketplace, let everything you do reflect your brand. Then, you can develop the one thing you need to “stand out in the crowd” to add to your advertising, your newsletters, your business cards, and your website that says “Hey, this is a REALTOR® you can trust to do a better job than every other REALTOR® out there.”

5. Do good (and tell folks about it). Another variation of public relations is goodwill. Someone once defined public relations as doing good and telling about it. It’s just that simple.

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Before you decide, answer these questions for each option: •

Do you have a personal connection to the cause that makes it a part of who you are?

Does the cause reflect your personal and professional philosophy?

Are there ongoing activities you can do with other people who can drive business your way?

Will it increase your visibility among potential clients?

Does it mesh with real estate and complement your work?

If the answer is yes to these questions, consider this particular volunteer opportunity.

6.Create a stellar and unfailing display of customer service. As a coach, I see plenty of agents who can talk all day about giving good customer service. But that’s where it all ends – at the talking stage. These agents postpone returning e-mails and phone calls from leads. They never look for ways to go above and beyond what the clients might expect. They refuse to look for ways to improve themselves. Sad but true. Look at other agents in your market who are known for outstanding customer service. Then create five specific ways to make your service even better. Seek to constantly add value to everything you do for clients.

news.wra.org


7. Develop an unquenchable thirst for knowledge.

that they can succeed –will succeed – no matter what.

Sure, you expect top producers to know their business and many will have the CRS, GRE and other certifications. But these top producers never think they know it all. In fact, they’d be the first to tell you they learn something new every day. That’s because they’re curious and they’re always seeking – and usually finding – opportunities in their market where others only see roadblocks. Is your level of curiosity where it should be? If not, hit the books and the classroom to keep learning.

Stop for a minute and ask yourself if you really, truly believe this about yourself. If not, do some soul searching to find out what will help you believe. Because once you do, watch out – this main ingredient will kick in and you’ll have all the success you can handle.

I honestly believe that the REALTORS® who’ll be around next year – and far into the future – are the ones who understand that their role is changing and make the changes needed to fit this new role. Our business is no longer just about selling homes. It’s about being a knowledgeable and reliable resource for consumers. Today and in the future, A REALTOR® is becoming more of a consultant, and less of a salesperson, because that’s the role the marketplace and consumers are demanding.

8. Cultivate a positive attitude and wear it constantly. If I had to pick a single ingredient that makes REALTORS® stand out, it would be attitude. Can you imagine a top producer with a bad attitude? Well, if you can, I promise you they won’t be one for long. The fire inside successful agents is at the very center of their belief

Let me hear from you. What are you doing to stand out in your marketplace? Have you found any specific ways to get noticed? What have you found most helpful in developing your personal brand? Please share any comments or questions you have about this article. Send me an e-mail at Bob@CorcoranCoaching.com. Bob Corcoran is a nationally recognized speaker and author who is founder and president of Corcoran Consulting Inc. (CorcoranCoaching. com, 800-957-8353), an international consulting and coaching company that specializes in performance coaching and the implementation of sound business systems into the residential or commercial broker or agent’s existing practice. We look forward to hearing from you. Sign up TODAY for your complimentary business consultation. http://www.CorcoranCoaching. com/bpw.php

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wisconsin real estate magazine

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news monthly wisconsin housing report

Home Sales Fall in October but Prices Are Stable By David E. Clark, Economist, C3 Statistical Solutions Inc.

> WISCONSIN HOUSING STATISTICS MONTHLY ACTIVITY - NOVEMBER 2010

YTD-2010

YTD-2009

% Change

112,038 43,504 $142,500

112,103 46,735 $143,725

-0.1% -6.9% -0.9%

OCT-2010

OCT-2009

% Change

New Listings Closed Sales Median Sales Prices

7,736 3,500 $140,000

9,400 5,572 $140,000

-17.7% -36.3% 0%

Region

Median Price OCT-2010 OCT-2009 % Change

Existing Home Sales OCT-2010 OCT-2009

% Change

Southeast South Central West Northeast Central North

$154,750 $150,000 $131,250 $130,000 $114,500 $132,000

1221 688 402 671 240 323

-38.9% -29.9% -37.0% -35.6% -34.2% -40.4%

H

-1.4% -3.8% +2.9% +8.4% -5.6% +9.7%

Despite the fact that the recession has been officially over since last summer, there remains a great deal of uncertainty in the economy, leaving consumers, businesses and lenders skittish about the future, according to the WRA. The recently concluded elections only added to the uncertainty, according to Horning. “With the mid-term elections now behind us, we will hopefully get some clarity over the future course of the economy,” said Horning, noting Wall Street responded positively to the election results. “What we need now is job growth,” Horning said. “With modest gains of almost 28,000 new jobs in the state since the beginning of the year, including about 7600 manufacturing jobs, we hope this signals stronger economic growth in the near future.”

Comparing October 2010 to October 2009, home sales were down 36.3 percent but median prices remained unchanged at $140,000. “The market continues to experience distortions created by the two separate federal home buyer tax credit programs,” said John Horning, Chairman of the WRA Board of Directors. “Last October the market saw an inflated number of buyers who were trying to take advantage of the first tax credit program which was due to expire at the end of November. That inflated last October’s sales and makes this October look particularly weak by comparison,” said Horning. “We may have

wisconsin real estate magazine

$157,000 $156,000 $127,500 $119,900 $121,275 $120,350

to wait another year before normal sales patterns return, allowing us to have truly valid monthly sales comparisons.”

ome sales in Wisconsin fell in October but prices remained stable, according to the Wisconsin REALTORS® Association (WRA). So far this year, sales of existing homes were down 6.9 percent with median prices down just 0.9 percent since January.

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Statewide

The statewide inventory of homes spiked to 15.3 months, largely as a result of the large

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1999 981 638 1042 365 542

decline in home sales in October. “With inventories up, this is a very good market for buyers who can qualify for a mortgage,” said WRA President Bill Malkasian. “With 30 year fixed rate mortgages at 4.23 percent, rates have never been more favorable, and with stable prices, housing affordability continues to be extremely high,” said Malkasian. The WRA’s new monthly Housing Affordability Index measures how much of a median priced home a buyer with the Wisconsin median family income can afford. “Our housing affordability index is currently at 210, up slightly from October of 2009,” Malkasian said. “This means a Wisconsin family with the median state income and 20 percent down payment can afford to buy 210 percent of the median priced home, making Wisconsin housing very affordable when compared to national benchmarks,” noted Malkasian. For More Information Contact: David E. Clark, Economist, C3 Statistical Solutions Inc. Office phone: 414-803-6537

news.wra.org


legal

Home Ownership Matters to People… To Communities…To America By debbi conrad

W

hile the September 2010 issue of Time Magazine and other media reports have sought to question the value of home ownership and the government policies that promote home ownership, the National Association of REALTORS® has launched a campaign to counter these detractors and assure consumers that the fundamental reasons for owning a home remain as compelling as ever. The NAR Home Ownership Matters campaign reaches out to lawmakers, consumers and the media and emphasizes the importance of this American institution for consumers, neighborhoods, communities and our country. Valuable resources and tools that Association Executives and REALTORS® can use to address consumer concerns may be found at www. realtor.org/homeownership. The content of this site will grow as the months go on and NAR’s efforts increasingly take the spotlight. Nonetheless, it is important for REALTORS® to be prepared today to alleviate any consumer concerns with home ownership. The following are examples of NAR Home Ownership Matters talking points:

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Owning a home is one of the best ways to build long-term wealth. Home ownership is an investment in your future. Historically, a home owner’s net worth has ranged from 31 to 46 times that of a renter.

Owning a home offers immediate shelter benefits and long-term value. Most home owners enjoy stable housing costs -- a fixed-rate mortgage payment might not change for 15 to 30 years while rent typically increases 3 % per year.

Home owners can typically deduct mortgage interest and property taxes on their federal individual income tax return.

According to U.S. Census Bureau data,

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home owners do not move as frequently as renters, providing more neighborhood stability. Home owners are more likely to be involved and engaged in local issues. In turn, this stability helps reduce crime and supports neighborhood upkeep. •

Home owners are more likely to vote and they volunteer for political and charitable causes more frequently than renters, according to the NAR study, “Social Benefits of Homeownership and Stable Housing,” at http:// www.realtor.org/research/research/ homeownershipbenefits.

Children of home owners do better in school, stay in school longer, are more likely to participate in organized activities and spend less time in front of the television.

Home owners pay 80 to 90% of federal individual income taxes, contributing to federal programs that benefit all Americans.

According to the 2010 NAR Profile of Home Buyers and Sellers, first-time buyers most often cite the desire to own a home as the primary reason for their recent home purchase. 85 percent of all recent home buyers consider home purchase a solid investment, and 76 percent of them believe owning a home is as good as or better than an investment in stocks. The Profile includes interactive maps and resources. Visit http://www. realtor.org/research_secured/research/ home_buyers_sellers_maps.

All REALTORS® should spread the word that Home Ownership Matters! For more information and data, see www.REALTOR.org/ Homeownership. Debbi Conrad is Senior Attorney and Director of Legal Affairs for the WRA.

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legal

best of the legal hotline

with tracy rucka

The Accidental Property Manager

I

n cases where the seller is a property owner who has vacated the property to seek employment or a lender (REO) who obtained the property in foreclosure, a broker who usually lists property for sale may be asked to provide property management services for the seller. The following Hotline questions and answers relate to the myriad different services licensees are asked to provide and how licensees may choose to respond to such requests. Keep in mind the scope of property management services may run the gambit from real estate brokerage services, including marketing the property for lease and negotiating the lease with the tenant, to physical maintenance services like changing light bulbs, mowing, raking or shoveling. The licensee must consider if the requested services are real estate brokerage or services independent from real estate brokerage and the brokerage company.

Two Signs The broker just went to the listed property and there was another broker’s sign in the yard saying the property is listed for rent. How can there be two listing brokers? The sale and the lease of a property involve two separate interests in real estate. It is possible for the seller to enter into a listing for the sale of the property with one broker and a listing for the rental of the property with another broker. Because the offer to purchase provides that a buyer takes title to the property subject to the

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tenant’s rights, the seller may consider the impact on a potential sale when negotiating the terms of a lease or rental agreement with a prospective tenant. The listing broker got a call from the seller who stated that she just rented her property on a year lease. The listing for sale expires shortly. Can the broker continue to market the property? The existence of a lease does not change the broker’s obligations to market the property according to the terms of the listing contract. The broker may ask the seller for a copy of the lease to provide to any potential buyer. Any offer to purchase will need to be subject to the terms and conditions of the lease. It may be possible for the seller or the buyer to negotiate with the tenant to modify or shorten the lease, but that will be at the tenant’s discretion. Given that the lease is for a year, a potential buyer may be subject to rental weatherization, depending on when the property sells. Rental weatherization compliance is triggered in cases where the buyer will not owner occupy the property within 60 days of the purchase. Therefore, if the tenant will remain in possession more than 60 days after closing, the property will be subject to rental weatherization.

Easy Cash Flow? A seller has asked the listing agent about renting out his property until the seller can get it sold. What should the seller consider? What should the broker consider?

news.wra.org


Renting the property may not be the easy quick fix for cash flow that the seller envisions. The property owner will become a landlord subject to the requirements of Wis. Stat. chapter 704 and Wis. Admin. Code chapter ATCP 134. Property showings will require proper advance notice to the tenant. Any offer to purchase will need to be drafted subject to the tenant’s rights. The owner will find himself developing tenant selection criteria and obtaining credit reports to qualify potential tenants. The seller will also be wise to consult with his insurance provider about insurance coverage during the rental period, and prepare a budget for repairs and maintenance if, for example, an appliance malfunctions while the property is rented. The owner must also provide the federally-mandated LBP disclosures if the property is target housing. If a potential buyer identifies defects, any repairs would be subject to the LBP renovation rules for tenant occupied property. See the May 2010 Legal Update, “Lead Based Paint in Target Housing,” at www.wra.org/LU1005. From the broker’s perspective, the first question is whether the broker wants to provide such services. If property management is not a service provided by the broker, the broker can evaluate whether he should expand into this arena of lease listings and property management services, taking into consideration the demands of customer service, the risks of entering a new practice field, the rewards of profitability and the rigors of competent practice.

Office Policy The agent is working with a seller who wants to rent her property while it is for sale. What can the agent do if the brokerage company does not offer property management or rental services? A licensee provides real estate brokerage services, whether for the sale or lease of property, on behalf of the brokerage company. The agent may see if the broker is willing to provide such services. If not, the agent may refer the seller to other brokers who provide property management or rental services. As another option, if the agent has a broker’s license, he or she may, with the broker’s consent, establish an independent practice for property management or leasing services. When an individual has a broker’s license and is working under another broker, Wis. Admin. Code § RL 17.03(1) permits the licensed individual to conduct some independent practice. The licensed individual must have the written consent of the employing broker and must avoid conflicts of interest. In addition, the licensed individual may not engage other licensees in this independent practice. Where a licensed individual conducts independent practice, care should be taken that all of the normal aspects of a brokerage are provided for. The brokerage company should have no responsibility for the independent practice if the licensed individual establishes the operation as clearly independent. For further information about independent practice, see the March 2008 Legal Update, “Running a Real Estate Office,” at www.wra.org/ LU0803.

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Short Sales or Foreclosures The seller has the property listed and the broker knows that it is a potential short sale. The listing has been in place for months and the seller believes the lender will soon start foreclosure proceedings. The seller asks the broker if he should vacate the property and try to rent it. Will this affect the foreclosure? First, before the property owner considers renting his property, he should review the terms and conditions of his mortgage. In some instances, renting the property may trigger a due-on-sale clause in the mortgage or a modification of the loan terms. In addition, the seller should talk to his attorney about the implications of vacating or renting the property on the seller’s right of redemption in the pending foreclosure. Whether the owner remains in possession will have an effect on redemption periods. More information about the owner’s right to redeem is available in the March 2009 Wisconsin Real Estate Magazine article “Foreclosure: How Long to Redemption?” at http://news.wra.org/ story.asp?a=1074. In addition, the broker may need to disclose to the potential tenant that the property has a pending foreclosure action; this may be considered a material adverse fact. The mortgage foreclosure statutes have been recently amended to protect tenants when a property is in foreclosure. A detailed discussion is available in the May 2009 Wisconsin Real Estate Magazine article “New Law Protects Tenant’s Rights in Foreclosure” at http://news.wra.org/story.asp?a=1116. The seller’s attorney can advise the seller on these matters, whereas the broker cannot engage in the unlicensed practice of law. news.wra.org


Winterizing Properties

agent prepare a lease and also have the buyer sign an offer to purchase?

The seller asks the listing agent to hire contractors to winterize the property. What issues should the agent consider?

The seller is asking the broker to provide two types of real estate brokerage services: to negotiate a lease and to negotiate an option for the possible sale of the condominium unit. If the broker currently has a listing for sale and not lease, the WB-37 Exclusive Listing Contract for Lease of Real Property may be used. The WB-37 is used when a property owner hires a real estate broker to lease the owner’s property (assuming the owner and the broker don’t want a property management relationship) and is mandatory with respect to the lease of residential property.

At a minimum, the agent should have a written work order which identifies the listing agent as an agent of the owner, indicates that the work is being done on behalf of the owner, and emphasizes that all billings are the responsibility of the owner and should be put in the owner’s name. Information regarding the contractor’s insurance, bonding, etc., should be provided to the owner. Preferably the owner, and not the listing agent, will select the contractor to avoid later claims that the agent was negligent in the hiring of the contractor. If the broker agrees to be an intermediary between the contractor and the seller, the broker should obtain written authorization from the seller to hire the contractors, including a disclaimer that the licensee is not responsible for any negligence by the contractor, and the contractor should be properly certified or licensed to engage in the service provided. The May 2004 Legal Update, “Avoiding Liability When Signing and Making Referrals,” available at www.wra. org/LU0405 contains both a sample Service Request form and an Authorization and Release from Liability form.

Rent-to-Own An agent has a listing for the sale of a condominium unit. The seller wants the agent to draw up a rent-to-own contract. The agent is not sure how to do this. The offer would be a closing in 13 months. Does the

There is no state-approved form for a rent-to-own situation. Before proceeding, the seller may be well-advised to review his or her mortgage and the condominium documents to determine if they allow the owner to rent the condominium unit. The parties may structure their agreement in a variety of ways: a lease and an offer to purchase, a lease with an option, an offer with early occupancy or a land contract. The agent may offer these alternatives for the parties’ consideration. It will then be up to the parties to decide how to structure the transaction. The agent may refer to the July 2008 Legal Update, “Using Land Contract and Leases with Options,” available at www.wra.org/LU0807 for more information about lease options. Tracy Rucka is Director of Professional Standards and Practices for the WRA.

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legal

There’s a Form for That WRA Forms for Everyday Issues

By cori lamont

Recently, while traveling around the state to speak about legal pitfalls, I discovered a great amount of interest and lack of awareness about some of the WRA forms. In many instances, there was even an audible Aha! after learning that a certain form existed.

I

n hopes of providing everyone with their own Aha moment, here are the top five forms that garnered the most interest. All of the forms discussed are in ZipForm.

1. Listing Questionnaire Regarding Title Issues Form (WRAQST) Before listing a property, prudent practice includes determining whether an owner will be able to convey title in the event a buyer is found. In these times of foreclosures and short sales, a practical licensee will take into consideration a property owner’s debts, judgments, liens and other encumbrances on the property. Besides obtaining a search and hold from the title company, completion of the QST will help the broker and seller determine a number of potential title issues and if listing the property is in the best interest for both parties. In addition to basic property information, there is a place for the seller to indicate if they are a personal representative, guardian or power-ofattorney for the property owner. This form asks the seller 26 questions relating to title. Questions range from asking if any remodeling or

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construction work has occurred within the last 6 months to whether there are any court judgments or tax liens against the owner. If the seller responds yes, a space is provided for explanation.

2. Listing/Selling Agent Visual Inspection Form (WRA-LAI) License law requires all licensees to inspect the property. Listing brokers are required to inspect the property prior to executing the listing. Even though the law does not speak to a specific time frame for cooperating brokers to inspect the property, prudent practice would be prior to writing the offer. While there is no written form required with respect to the licensees’ inspection of the property, cautious brokers will require all their agents to keep a written record of their observations; the LAI could help. This form includes one informational page relating to the visual inspection requirement of licensees and guidance on how the form should be utilized. The second page provides space for the licensee to acknowledge what they observed on the property relating to the exterior, interior and other areas.

news.wra.org


3. Seller’s Refusal to Complete Condition Report Form (WRA-SRR) Prior to executing the listing, listing brokers are required to ask the seller about the condition of the structure, mechanical systems and other relevant aspects of the property and ask for the seller to respond in writing. Generally, this response takes the form of a real estate condition report or a seller disclosure report. If the seller refuses to complete a report, best practice for the listing broker would be to obtain a SRR for the file. This form references the listing broker’s requirement to ask the seller about the condition of the property and request a written response. The SRR includes a seller’s acknowledgement paragraph indicating that the broker asked the seller complete a condition report or other disclosure, and the seller refused. Additionally, this paragraph provides that such refusal does not excuse the seller from making certain property condition disclosures under the law. This form also reminds the seller of the broker’s legal obligation to disclose material adverse facts. Lastly, the form includes a place for the seller’s initials and documents the form’s delivery by the agent.

4. Disclosure of Material Adverse Fact Form (WRA-DMAF) Licensees are required to disclose known material adverse facts and information suggesting a material adverse fact; such disclosure applies even if the client directs the licensee not to disclose. A disclosure is material if a party to the transaction were to so indicate, or if a competent licensee would generally recognize that this fact is of such importance that it would affect a reasonable party’s decision to enter into a contract or would affect the party’s decision about the terms of the contract. The disclosure must be made to all interested parties, in writing and in a timely manner. This form references disclosure requirements of Wis. Stat. § 452.133 and Wis. Admin. Code RL § 24.07(2)-(3), the definition of adverse fact, blank lines for the licensee to include the written disclosure, a statement recommending the parties obtain professional assistance relating to the disclosed information and places for the licensee’s signature and the parties’ initials.

5. Addendum AR to the Offer to Purchase (Rider) (WRA-AR) At this time, the release dates of the remaining offer to purchase forms are not known. In an effort to help offer licensees the ability to add provisions from the revised WB-11 Residential Offer to Purchase into the remaining state-approved offers yet to be revised, the Addendum AR was created. The AR is designed to be used with the WB-12 Farm, WB-13 Vacant, WB-14 Condominium, and WB-15 Commercial offers to purchase. This form incorporates certain WB-11 revisions, such as: the Appraisal Contingency; Gap Endorsement; Alternative Real Estate Tax Proration Formulas; E-mail Delivery; If This Offer is Not Contingent on Financing; Distribution of Information; Sex Offender Registry; and a sentence addressing Conflicting Provisions. Cori Lamont is Director of Brokerage Regulation and Licensing for the WRA.

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Amendment to Article 10: An Achievement of Cooperative Effort

By debbi conrad

the proposed Article 10 amendment, which was then forwarded to the NAR Board of Directors. The Board unanimously approved the amendment.

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he story of how the protections of Article 10 of the REALTOR® Code of Ethics were extended to those in the gay, lesbian, bisexual and transgender (GLBT) community illustrates the rich rewards that can be achieved through cooperative efforts. In 2007, the gay, lesbian and gay friendly members of the National Association of Gay and Lesbian Real Estate Professionals (NAGLREP), led by founder Jeff Berger, began their mission to amend Article 10 of the National Association of REALTORS® Code of Ethics to prohibit REALTOR® discrimination based on sexual orientation. NAGLREP director Eric Kodner brought the proposal to the Wisconsin REALTORS® Association Equal Opportunity in Housing Committee in 2009. This was a natural fit because not every state has an active equal opportunity/cultural diversity committee as does the WRA, and because Wisconsin was the first state in the nation to enact a state law prohibiting discrimination in housing based upon sexual orientation in 1982. The Committee prepared a proposal asking the NAR Interpretations and Procedures Subcommittee of the NAR Professional Standards Committee to initiate an Article 10 amendment and asking the Equal Opportunity/Cultural Diversity Committee for their support. In August 2009, the WRA Board of Directors approved this proposal, which was then submitted to NAR and favorably received by NAR staff.

Throughout this process, the WRA Equal Opportunity Committee worked in partnership with NAGLREP, with the assistance of Cliff Niersbach, NAR Board Policy & Programs; Fred Underwood, NAR Community and Political Affairs; and NAR 2010 President Vicki Cox Golder to bring this long and winding journey to a successful conclusion.

During the November 2009 NAR annual meetings in San Diego, Kevin King and Char Glocke asked the NAR Equal Opportunity/Cultural Diversity Committee to recommend to the Professional Standards Committee that it amend Article 10 to prohibit discrimination based upon sexual orientation. That Committee instead recommended that existing NAR policy on equal housing opportunity be amended to include opposition to discrimination based on sexual orientation. This recommendation was approved by the NAR Executive Committee and the NAR Board of Directors.

REALTORS® shall not deny equal professional services to any person for reasons of race, color, religion, sex, handicap, familial status, national origin, or sexual orientation. REALTORS® shall not be parties to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, or sexual orientation. (Amended 1/90 and 1/11)

In 2010, the focus shifted to the Interpretations and Procedures Subcommittee of the NAR Professional Standards Committee, where all amendments to the Code of Ethics must begin. The Subcommittee, which included Kevin King, adopted the proposed Article 10 amendment to prohibit discrimination based upon sexual orientation in March. In May 2010, during the NAR Midyear meetings in Washington, D.C., the NAR Equal Opportunity/Cultural Diversity Committee, upon the request of the WRA, issued a strong recommendation to the Professional Standards Committee that Article 10 be amended to prohibit discrimination based upon sexual orientation. The Professional Standards Committee approved

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The remaining hurdle to clear was the NAR Delegate Body where Code of Ethics amendments must be approved by a two-thirds majority. The Delegate Body met during the annual NAR meetings in New Orleans. On November 8, 2010, delegates representing 791 boards and 876,379 REALTORS® were present. Although the Article 10 amendment did pass by voice vote, a delegate requested a paper ballot that revealed that over 93 percent of the Delegate Body voted in favor of the Article 10 amendment!

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A protected class had not been added to the NAR Code of Ethics since 1998, when the federal fair housing law changed to include people with disabilities and families with children. The NAR Code was amended to match the federal law. This marks the first time Article 10 has included a protected class not already protected by federal fair housing law. As NAR General Counsel Laurie Janik observed, this time NAR is ahead of Congress.

Effective January 1, 2011, Article 10 of the Code of Ethics will provide: Article 10

REALTORS®, in their real estate employment practices, shall not discriminate against any person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, or sexual orientation. (Amended 1/00 and 1/11) Standard of Practice 10-3 REALTORS® shall not print, display or circulate any statement or advertisement with respect to selling or renting of a property that indicates any preference, limitations or discrimination based on race, color, religion, sex, handicap, familial status, national origin, or sexual orientation. (Adopted 1/94, Renumbered 1/05, 1/06 and 1/11) Debbi Conrad is Senior Attorney and Director of Legal Affairs for the WRA. news.wra.org


Realtor® sales tip

Checklists for Success By marcus a. wally

We are responsible for so many details every day that I can’t imagine facilitating a transaction from contract to closing without a checklist. Using a checklist to stay organized is one of the best practices I know of. This Sales Tip will walk you through some ways to successfully create and use checklists in your office.

Why is a checklist helpful? The checklist’s primary purpose is to help keep track of critical dates and time periods in a real estate transaction. Abundant liability exists for all real estate professionals and anything that we can do to limit risk is a good thing. As a broker-owner, risk reduction is a top priority for me!

tasks are completed and the proper paperwork is in the listing file folder along with all parties’ initials/ signatures.

‰‰ Have the current taxes been verified?

‰‰ The first requirement is to ensure that the proper disclosures have been given in writing and are returned signed and dated.

What information should you collect from the seller?

‰‰

A checklist can be developed for both a buyer and a seller. I have one for each type of transaction, as my buyer checklist has certain features that are not appropriate for my seller checklist. Always start with a general checklist, then add specifics that apply to your individual company policies and procedures.

The seller’s estimated closing costs sheet should be completed and signed by all owners on the deed.

‰‰ The Exclusive Right to Sell Listing agreement must be signed, dated by the seller, listing agent and broker of the office.

My team and I have a file folder for every transaction, labeled with the property address. We keep these listings and selling file folders alphabetized in our large file cabinet and accessible to all team members. These files traditionally stay in the office and are not to be removed. Our administrative staff has full access so that they can help and support the agents at any time.

‰‰ Has the seller’s property disclosure (property condition report) been filled out, signed/dated by seller and returned to the office?

How do you get started?

‰‰ Were advertisements written?

For each listing we take, a file folder is created and for each buyer that a member of the team works with, a file folder is created for them specifically.

‰‰ Have digital photos been taken?

‰‰ Was the Home Warranty (home protection plan) signed, accepted or waived and a copy placed in the file? ‰‰ Was the MLS computer data sheet completed?

‰‰ Is a virtual tour ordered? ‰‰ Are the showing instructions written on the inside of the listing file folder?

We choose to staple the appropriate checklist to the inside front cover of the file folder so that at a fast glance, anyone picking up the file folder can help answer any question relating to the transaction.

‰‰ Are all the important phone numbers/emails addresses/ in the file folder?

The listing packet checklist requires the owner of the property and the property address to be written in at the very top of the checklist form.

‰‰ Are the keys logged in? ‰‰ Is the sign on the property? Does a special community sign need to be ordered?

What steps should be included in a checklist?

‰‰ Is the property to be on the MLS caravan and also the listing company’s own in-house caravan?

Moving from top to bottom, twenty lines guide the agent from first point of contact with the seller to the completion of the property listing and entry into our local MLS database. There is a small line to the very right of each task that allows the agent to place his or her initials in the blank space after completing a requirement. Toward the end of a transaction, our administrative staff carefully checks that all listing wisconsin real estate magazine

‰‰ Is a MLS number assigned? ‰‰ What is the name of builder? (call the county office building department) ‰‰ Has the correct zoning been verified with the zoning department?

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‰‰ Have the current school districts been verified?

At the bottom of this checklist is a section I call “Collect from the Seller.” In this section, I include: ‰‰ A copy of the Warranty Deed (this document shows true ownership) ‰‰ The current insurance company name/phone number/policy number ‰‰ The previous title policy as a re-issue credit may be available to my sellers ‰‰ A copy of the owner’s survey (this will accurately show me the boundary lines of the property) ‰‰ Is the property in a flood zone? If so, get a copy of the elevation certificate. ‰‰ Do my owners have a current termite bond in place? ‰‰ The loan number and mortgage company’s phone number - is there a prepayment penalty? ‰‰ And then I always get my seller’s birthday and anniversary dates. ‰‰ The last few lines are left blank for me to take notes.

What about a closing checklist? My closing checklist is similar. At the very top of the form, I detail both the seller’s and buyer’s information: names, address, phone numbers, email addresses. Then I include: ‰‰ The type of transaction is checked (cash, conventional, FHA, VA, Owner financing) ‰‰ The list of tasks to be completed from the moment we go under contract (have an accepted offer) with a small line where the date of each completed item is noted. ‰‰ My checklist starts with the contract and all

17


‰‰ Attend closing - has the home warranty application been signed by all parties (buyers and sellers) and the application given to the title agent to mail to the company.

addendums being signed by all parties and placed in the file. ‰‰ A second binder includes the deposit due and the date when it was received. These are two important items to track. There is a big liability here if I miss collecting a good faith escrow binder that the contract states will be placed in escrow.

‰‰ To bring back to the office: settlement statement (HUD 1) signed by all parties, commission check, copy of survey and termite report, etc.). Note: Take extra care to verify that the commission check you are given is the correct amount and made payable to the correct real estate agency. Many times the closing company will mix up the checks and you could leave the building with the cooperating agency’s check.

‰‰ The next item on my checklist is the verification that the bank application has been made (if appropriate) and with which lender. ‰‰ Dates are to be filled in as to when the home inspection/termite report (WDO) is ordered and with whom?

The last few things on my check list are to verify that the sign and lock box have been removed from the property if it is an in-house listing.

‰‰ Has the seller’s property condition report been shared with the buyers and a copy of the buyers’ signatures saying they received the same.

Remember to get the buyer’s birthday and anniversary dates for follow up and future referrals! At the very bottom of my closing checklist, I include the date and initials of the agent completing each step. Always include a company name and contact person’s name and phone number while completing the closing process. Remember to document all phone calls/conversations and record the price quotes given at the time orders are placed along with the name of the person you

‰‰ Appraisal and survey ordered (if applicable) with which company and confirm costs for each. ‰‰ Has the contract for sale and purchase and all addendums been sent to the lender? ‰‰ Insurance (home owners and flood) ordered with whom? Verify costs?

have spoken with. Then, on the back side of this sheet we have blank lines so my team can take careful notes at each point in the process. My legal counsel always reminds me of the importance of documenting everything so that, should the occasion arise, I am not going off my memory but have documented notes. In today’s litigious world, we as top-notch professionals must take great care in all we do. Having a buyer and seller checklist is one way to ensure that we provide our customers with excellent service while earning potential referrals later on. Marcus A. Wally, MBA, is an active Florida REALTOR® in St. Augustine, Florida. Marcus is the founder and broker of New World Realty, which also manages coaching and facilitation of education classes around the world. Marcus earned his MBA from the University of North Florida in Jacksonville. He can be reached at (904) 669-1081 or by e-mail at marcuswally@ comcast.net.

‰‰ The date the loan approval is granted ‰‰ The date the title binder (commitment) has been received and the date this is passed on to buyers ‰‰ If an in-house listing, has the sale pending rider been placed on the sign and the states in the MLS changed to pending? ‰‰ Has the closing date been shared with all parties? Is a walk-through scheduled? ‰‰ Request binder check and collect all keys to take to closing

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February 8-11, 2011 Kalahari Resort & Convention Center Wisconsin Dells, WI

Wisconsin REALTORS® Association

NEW!

3 Easy Payment Plan

Designation WEEK Many Courses...One Location!

GRI Course 2 | February 8-11, 2011 (submitted for CE)

Instructors: Jackie Leavenworth, CRS; Mark Porter, CRS; Doug Hoffman; Cori Lamont

GRI Course 3 | February 8-11, 2011 (submitted for CE)

Instructors: Tom Lundstedt, CCIM and Frank Serio, CRS

CRS 201: Listing Strategies Included in GRI Course 2 February 8-9, 2011 Instructor: Jackie Leavenworth, CRS

CRS 202: Effective Buyer Sales Strategies Included in GRI Course 3

February 10-11, 2011

Instructor: Frank Serio, CRS

New for 2011! 3 – Easy Payment Plan This plan allows designation week attendees to register for any course and pay in three installments. Plan Details: • Must call to register. • Deadline to register for this payment option is December 7, 2010. • First payment is due upon enrollment; subsequent payments charged on the 1st business day of the following two months and must pay by credit card. • Standard cancellation policy

CRS111 – Short Sales and Foreclosure Course (CRS and SFR Core Course) (submitted for CE) February 9, 2011 Instructor: Frank Serio, CRS

Microsoft Outlook – E-Marketing Strategies for Real Estate (CRS Elective) February 10, 2011

register today!

wra.org/DesWeek

Instructor: Mark Porter, CRS

You may qualify for a Scholarship! GRI Scholarships are available to WRA members. Contact your local board/association, the Wisconsin CRS Chapter, the WRA or visit www.wra.org/GRIscholarship for application information. This year’s deadline is January 21, 2011.


education

REMINDER: CE Renewal Is Due December 14, 2010! All real estate licensees must renew their license before December 14, 2010. The Department of Regulation and Licensing requires that all real estate licensees complete 18 hours of continuing education each biennium, an increase from 12 hours. There are four mandatory courses and a list of six electives. Licensees must complete the four mandatory courses and two DRL-approved electives. At the time of renewal, licensees will now need to provide the following information for the 18 CE hours they have completed: Course Date, Course Title, Sponsor, Number of Hours.

Mandatory Courses

Elective Topics

(All licensees must take courses 1-4.)

(Licensees must take two of the following.)

Course 1 - Listing Contracts Course 2 - Offer to Purchase Course 3 - New Developments Course 4 - Buyer Agency Agreements

Elective A - Risk Reduction Elective B - 1031 Exchanges and Exchange Opportunities Elective C - Condominiums Elective D - Landlord/Tenant and Property Management Elective E - Financing the Sale Elective F - Broker Supervision

CRS 111 - Short Sales and Foreclosures February 9, 2011

GRI Course 2 February 8-11, 2011 Wisconsin Dells

Wisconsin Dells

This 4-day program includes CRS201 (Listing Strategies) so you can earn required education credits toward your CRS designation while earning your GRI Designation. The course also covers Business Ethics, Social Media, Environmental Issues, Cameras and Virtual Tours and Internet Marketing. (submitted for 2011-2012 CE). Instructors: Jackie Leavenworth, CRS, Mark Porter, CRS, Doug Hoffman and Cori Lamont

CRS201 – Listing Strategies February 8-9, 2011 Wisconsin Dells (included in GRI Course 2) The quality of your listing skills can give you a strong competitive edge. Only those professionals who learn proven listing strategies will win over the client and increase their conversion rate. Listing Strategies will provide you with the important skills necessary to conduct successful listing presentations, price a home to sell, close the transaction and market and promote effectively. The course will take you through an actual listing presentation that will help you understand the key steps in this process and create a system for success.

ABR Course March 10-11, 2011

Working with buyers and sellers of distressed properties can be frustrating and timeconsuming, but also very rewarding. The Short Sales and Foreclosures Course provides you with practical approaches to the pre-foreclosure and foreclosure processes that will result in the successful disposition of these properties. Complete core course for your SFR certification (Short Sales & Foreclosures Resource) and earn one core credit toward your CRS Designation plus you can earn your CRS faster with the Pro-Program with 10 years’ experience and 150 transactions plus one other CRS core course.

GRI Course 3 February 8-11, 2011 Wisconsin Dells Included in this 4-day program is CRS202 (Sales Strategies), giving you the opportunity to earn required education credits toward your CRS designation while working on your GRI Designation. Also included is real estate investments and exchanging. Calculator is required. (Submitted for 2011-2012 CE). Instructors: Tom Lundstedt, CCIM and Frank Serio, CRS

CRS 202 – Effective Buyer Sales Strategies February 10-11, 2011

WRA Headquarters - Madison

Wisconsin Dells (included in GRI Course 3)

Required education for the ABR designation. You will learn agency and fiduciary duties; what form of representation to offer; integration of buyer agency into traditional real estate practice; plus more.

You can enjoy a competitive advantage because you will understand what motivates and influences your customers. Sales Strategies will give you the inside track to win over prospective buyers by teaching you the necessary strategies that make your sales quick and efficient. You will learn how to work with today’s new buyers through counseling, salesmanship and negotiation. These effective strategies will give you customers for life.

Take advantage of the REBAC Special Discount! The registration fee will be reduced by $30.

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Course Schedule

Visit wra.org/CourseSchedule for full schedule.

Sales & Marketing Management Date Course Location

Early Reg.** $Reg.

$

*Fulfills core education for NAR new Short Sales and Foreclosure Resource (SFR) certification ** Early registration applies two weeks prior to start of the course. the # Appraiser section members receive a discount.

February 8-11, 2011 February 8, 11, 2011 February 9, 2011 February 10, 2011

Conference and Conventions Date Event December 9-10, 2010 Managment Conference February 8-11, 2011 Designation Week

Course

Location

(1)Fulfills core education for NAR new Short Sales and Foreclosure Resource (SFR) certification

December 7, 2010 December 7, 2010 December 9, 2010 December 10, 2010

2009-10 Course 1 & 2 (DVD) 2009-10 Elective C & E (DVD) 2009-10 Course 3 & 4 (DVD) 2009-10 Electives A & C (DVD)

La Crosse Appleton La Crosse La Crosse

Appraisal Continuing Education

Date

Course

March 16-17, 2011 Appraisal Conference 7 Hour Mandatory USPAP course will be offered on March 16, 2011

Pre-License

Date

* Plus books

January 4-7; 10-13, 2011 Sales Pre-License Course 8:00 - 5:00 Madison

Course

370 370 180 180 315 315

390 390 200 200 335 335

Pewaukee To register call 800-279-1972 Wisconsin Dells To register call 800-279-1972

Date

360 360 170 170 305 305

Location

Real Estate Continuing Education

books *Plus ** early registration applies two weeks prior to the start of the course. ^Check out Multiple Registration Discount and the New 3-easy payment option # Appraiser section members receive a discount

GRI Course 2 Wisconsin Dells GRI Course 3 Wisconsin Dells CRS 111 Short Sales & Foreclosures(1) Wisconsin Dells CRS: Microsoft Outlook E-Marketing Strategies Wisconsin Dells CRS201 only CRS202 only

ATD

$

Location

Location

608-785-7744 920-739-9108 608-785-7744 608-785-7744

Ho-Chunk Casino, Baraboo

Member

325*

Non-Member

325*

Available online!

QuickStart sales training program

www.wra.org/QuickStartOnDemand

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From Blue to Red By joe murray

In 24 months, Wisconsin went from a very “blue” state to an extremely “red” one. Republicans swept top-of-the-ticket races in 2010 for the first time since 1986: Governor, U.S. Senate, Attorney General, and even the office of State Treasurer. But the drubbing Democrats took in November extended well beyond top-tier races. The GOP increased their power by picking up congressional seats and state legislative seats in numbers that surprised even the most skilled prognosticators. Consider these facts: •

Wisconsin Democrats lost virtually everything on November 2nd, following a short-lived, 24-month power consolidation.

Ron Johnson is the first Republican elected to the U.S. Senate in Wisconsin since Bob Kasten in 1986.

With the election of Republicans Sean Duffy in the 7th Congressional District and Reid Ribble in the 8th Congressional District, 2010 marks the first time since 1974 that either party gained more than one congressional seat in the same election cycle in Wisconsin.

Attorney General J.B. Van Hollen is the first Republican to win re-election since Robert Warren in 1970.

The last time voters elected a governor from Milwaukee County was 1938 when Republican Julius Heil triumphed over Progressive Philip LaFollette.

2010 is the best mid-term election for Wisconsin Republicans since 1938. The GOP picked up a governor, Democrat Russ Feingold’s U.S. Senate seat, both state legislative chambers and two U.S. House seats. Republicans gained control of the State Senate 19-14. Going into November 2nd, Democrats controlled the State Senate 18-15. The GOP even defeated Senate Majority Leader Russ Decker (D-Weston). Republicans gained control of the State Assembly 60-38-1. Pre-election, Democrats controlled the Assembly 51-46-2. The GOP defeated Assembly Speaker Mike Sheridan (D-Janesville) and Independent Bob Ziegelbauer (Manitowoc) will likely caucus with Republicans, effectively giving the GOP a 61-seat majority. Wisconsin is the only state in 2010 where Democrats lost the governorship, a U.S. Senate seat and both houses of the legislature.

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Shocking? What makes this Wisconsin GOP landslide so remarkable is how soon it arrived after Barack Obama’s 14-point victory in Wisconsin just two years ago. Obama carried Wisconsin in the presidential election by 415,000 votes over John McCain and swept in State Assembly Democrats on his coattails. After the 2008 elections, Democrats had total power in Wisconsin government for the first time since 1986, december 2010

with majorities in the governor’s office and both houses of the legislature. Their power sweep that began in 2002 with the election of Governor Jim Doyle was complete. But voters were clearly shifting again in 2009, and two major retirements served notice that the 2010 election cycle would be a challenging one for Democrats. In July 2009, Governor Doyle abruptly announced he would not seek a third term, and on May 5, 2010, Congressman Dave Obey retired as well. Political observers had noted a dramatically changing political environment by the summer of 2009 and the retirement announcements of two of the most powerful political officeholders in Wisconsin confirmed the changing landscape for Majority Democrats. Wisconsin Democrats lost virtually everything on November 2nd, following a short-lived, 24-month power consolidation. Losses sustained by the GOP in the 200608 election cycles were recovered in one night. For Wisconsin, Democrat Herb Kohl now stands alone as the state’s top-elected official. For Republicans, the 2010 elections were the good news. Now, they must get to work on solving the difficult issues that face our state. Voters in Wisconsin were driven by concerns over large budget deficits and a weak economy. Governor-elect Scott Walker and the new GOP Majority must take these issues head-on and make substantial progress or voters may decide to change colors again in 2012. Joe Murray is Director of Political and Governmental Affairs for the WRA.

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Facing Budget Realities By Michael theo

G

overnor-elect Walker and leaders of the new Republican-controlled legislature have a pretty good idea what their priorities need to be come January. They must pass a biennial budget plan by July 1st that resolves a nearly $3 billion deficit. And unlike the last ugly budget debate, this time around there will be no federal bailout or stimulus funds to help.

The trick for the new Republican team will be to both resolve the budget crisis and set a new course for economic and job growth. That requires both tactical and strategic vision. It also requires help from the national economy. Thus, fiscal and economic success here in Wisconsin will very much depend on the success of a politically-split Congress and the Obama administration in addressing the federal budget deficit and the national economy.

Economic Impact of the Federal Deficit An analysis by the respected Wisconsin Taxpayers Alliance (WTA) of a report from the Congressional Budget Office (CBO) shows that the federal debt is projected to stand at 62% of GDP (gross domestic product) by the end of 2010, which is up from 37% just three years ago. Only once in American history has the federal debt been over 50% of GDP, and that was at the end of World War II. The CBO report is sobering. Under two different fiscal scenarios, they predict the debt will climb to 80-90% of GDP or higher by 2025-2035. Such a surge in public debt relative to the nation’s total economic output would certainly pose a full-blown fiscal crisis if not addressed. What would be the economic impact of such rising debt levels? Less investment capital, higher interest rates, and little or no flexibility for the government to address unexpected events like recessions, financial crises and wars. To avoid this, the federal government could restructure debt, increase the supply of money in the economy (risking inflation), and/or increase taxes and cut spending – or some combination of all of the

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above. Under any one of these scenarios, the choices are “limited and unattractive,” according to the WTA.

State Budget Focus As congress and the president struggle with the federal debt, the new governor and legislature will focus on the state budget deficit. According to the respected Legislative Fiscal Bureau (LFB), ongoing state expenditures for the next two years (2011-13 biennial budget) will be $14.5 billion per year, but ongoing revenues will be just $13.3 billion per year. That leaves a structural deficit between ongoing spending and ongoing revenue of approximately $2.5 to $2.8 billion. There is little doubt that Governor Walker and Republican legislative leaders will focus on reducing spending to meet revenue projections. But where those cuts are made and how big they’ll be will be the subject of much debate and bitter controversy between January and July 2011. The “big five” spending programs for state government include K-12 school aids (43.4% of the budget), Medicaid (8.4% of the budget), the University of Wisconsin system (8.1% of the budget), corrections (7.2% of the budget) and local aids (6.7% of the budget). What is clear is that past solutions to budget deficits alone won’t balance this budget. For example, according to former State Budget Director and Department of Revenue Secretary Rick Chandler, freezing all state spending would only reduce the budget gap by $1.6 billion. A robust economic recovery could only reduce the gap by $1 billion. Cuts to agency operating budgets would only reduce the gap by $375 million (unless much deeper cuts are approved), and taxes on the wealthy would only cut the gap by $300 million (unless tax hikes beyond historic levels are approved). So what’s the solution? The key to a short-term balanced budget is cutting spending. The key to long-term balanced budgets is economic and job growth. The real trick, then, for Governor Walker and the new Republican legislative leaders is to have the fortitude to make tough spending cuts as well as the vision to make investments in programs and tax policies that will lead to economic growth and job creation. Finding the right balance will grow Wisconsin’s “economic pie,” which is the only answer to what ails our state government and economy. Michael Theo is Senior Vice President of Legal and Public Affairs for the WRA.

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Public Land in Wisconsin How Much Is Enough?

When Wisconsin lawmakers reconvene in January to begin deliberations on how to resolve the state’s $3 billion deficit, they will be closely scrutinizing all of the state’s spending and programs to figure out where to cut costs, increase efficiencies and prioritize funding. One of the programs that will likely be evaluated is Wisconsin’s Stewardship Program, which provides funding to the Wisconsin Department of Natural Resources (DNR), local governments and nonprofit conservation organizations to make land purchases.

By tom larson

Tom Larson is Chief Lobbyist and Director of Legal and Public Affairs for the WRA.

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This article provides an overview of the current inventory of public land in Wisconsin, how the Stewardship program operates and is funded, and some factors to consider when deciding whether Wisconsin should continue to buy more public land.

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Current Inventory of Public Land Wisconsin consists of approximately 34.8 million acres of land. Over 5.7 million acres of this land, or 16.5%, is publicly owned and used for parks, forests, trails, and natural resource protection. [Note: these statistics do not include the public land used for roads, government buildings, military bases, and college/school campuses.] This 5.7 million acres of public land is owned as follows: •

Federal government owns approximately 1.5 million acres (4.4% of the state’s land area). Almost all of the federal forest land in Wisconsin is located in Chequamegon-Nicolet National Forest.

State government owns approximately 1.6 million acres (4.6% of the state’s land area). The land is managed by two agencies, the Board of Commissioners of Public Land (who manages lands granted by federal government) and the DNR (managing land owned by the state).

County government owns approximately 2.6 million acres (7.5% of the state’s land area)

Public land is located in 71 of Wisconsin’s 72 counties, with the most public land located in Bayfield County (464,673 acres). [Note: Menominee County does not have any public land, but 98% of the land is held in trust by the Menominee Tribe.] Twenty counties have over 100,000 acres of public land, while only 12 counties have fewer than 10,000 acres.

reductions for their conservation programs to address their state budget deficits. In determining whether to reduce funding for our Stewardship program, Wisconsin lawmakers will likely consider the following: Impact on local property tax base – One concern related to the Stewardship program is the impact on local property taxes given that much of this land is taken off the property tax rolls. However, when acquiring public land, the DNR makes annual payments in lieu of property taxes to the municipality where the property is located. The payment in lieu is based on property taxes that would have been paid and is adjusted annually for changes in value. Thus, DNR land acquisition should not lower property tax revenues. Moreover, if the DNR acquires land that was previously tax exempt, the DNR is still obligated to make property tax payments, which would provide additional revenue to the local municipality. Purchase price for land – The DNR is often criticized for paying too much for public land. However, when comparing the average purchase price paid by the DNR and statewide equalized values during the same time, the two numbers appear consistent. (Equalized value is the estimated measure of market value of land within the state.) For example, in 2006, the DNR paid approximately $2500 per acre, while the equalized value of land in Wisconsin was approximately $2400 per acre. [Note – the DNR often purchases unique land with higher values (e.g., along lakes and rivers)]

“Each year, nearly 14 million people visit state parks, forests and trails, generating millions of dollars for local businesses and state and local tax revenues.” Wisconsin Stewardship Program In 1989, Wisconsin created the Warren Knowles-Gaylord Nelson Stewardship Program to acquire land for preserving the state’s significant land and water resources and to provide land for recreational facilities. The DNR acquires land through both fee title and easements. Fee title means DNR purchases land directly, holds all land rights, and has complete control over its management. Easements are created when the DNR purchases some land rights for conservation (e.g., the right to develop), but the land remains privately owned, and property taxes continue to be paid by the landowner. Like other state infrastructure investments such as highways and buildings, the Stewardship program is funded with general obligation bonds. The state sells these bonds to investors and then repays the principal and interest over the next 20 years. Historically, the debt service has been paid with general purpose revenues, and since 1998 has been supplemented with Forestry funds. However, no hunting, fishing or park fees are used to repay the bonds.

Considerations As with any state program, the costs and benefits of the Stewardship program are often debated. Recently, several states (Maine, New York, and Vermont) have either reduced funding or are considering

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Taxpayer benefits – The use of taxpayer funding to acquire more public land is controversial, especially in tough economic times. Over the last 20 years, the total general obligation bonding authority of the Stewardship program has been over $1.6 billion. In 2010, the Stewardship program had about $86 million in bonding authority. Although significant cuts have been made to other areas of state funding (e.g., state school aids were cut by $150 million), Stewardship funding levels have remained unchanged since the annual bonding authority was increased from $60 million to $86 million in 2007. While the value of conservation programs are often questioned, some argue that public land provides valuable tourism dollars and other quality of life benefits to the state. Each year, nearly 14 million people visit state parks, forests and trails, generating millions of dollars for local businesses and state and local tax revenues. Moreover, employers often market our parks and recreational spaces when trying to attract new employees to Wisconsin. For more information on the Wisconsin Stewardship program, please contact Tom Larson (tlarson@wra.org) at (608) 240-8254. Note: The statistics in this article were from “Public Conservation Land in Wisconsin,” The Wisconsin Taxpayer, August 2009, Vol. 77, No. 8.

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Thinking about obtaining your Broker’s License? Start the 36-hour Broker Pre-license Distance Learning On Demand course today! There’s no need to wait for materials to ship and you can start your coursework immediately. As you progress through the course, the On Demand option includes review exercises, vocabulary builders, case studies and quizzes to measure your comprehension.

The WRA is excited to announce two new statistical products. The first product is a move to reporting housing statistics on a monthly basis, allowing us to deliver timelier data that better reflects current market conditions. This is important since the data is distributed to members, the media and the general public. Additionally, a large number of the local MLSs and the National Association of REALTORS® are already providing this data, making it a natural addition to the WRA’s product line. Finally, the reports allow us to work closely with some of the larger MLSs to produce a product that better syncs up with numbers reported at the local level.

Pre-License education has never been this convenient: take courses on your schedule – at your own pace, anytime, anywhere – over the Internet. All you need is a web browser and a broadband connection.

Broker Pre-License Distance Learning On Demand Features include: Cross-Platform Functionality Broker Pre-License Distance Learning On Demand is compatible with computers operating on Apple Safari, Mozilla Firefox, Google Chrome, Internet Explorer, and operate on both Macs and PCs. Intelligent Bookmarking Users who don’t want to forget where they left off in their coursework, and more specifically in their videos, can bookmark where they stopped. Upon closing the program, the player automatically bookmarks a student’s position. When the player re-launches the program, it cues the video to the position where the student left off and even points them to the next step.

The monthly product provides an analysis of new listings, closed sales, median home sales prices, monthly supply of inventory and the total inventory of homes for sale. The report itself will be produced in two formats – month-to-month and year-to-date – providing readers with a clearer snapshot of short- and long-term market conditions. The second product is really an enhancement of the WRA’s existing home sales reports. Currently, the WRA offers all of its statistics on the WRA website in table format so members can compare historical data. In addition to posting quarterly numbers, the WRA now offers an analysis of home sales by month dating back to January 2007. The data provides numbers on home sales and median pricing. Prior to 2007, this data was not available because Wisconsin had different MLS jurisdictions and methods for reporting home sales.

Full Screen Display Full screen video display allows students to view video streams that more accurately match their monitors and display sizes. Expanded Review Modules Unique to the WRA’s Pre-License program are expanded review modules, which include vocabulary building exercises, case studies and quizzes. This allows students to maximize their understanding of the curriculum. For a complete tour of the WRA’s Distance Learning On Demand technology, visit: http://wra.org/Education/distance_learning/ondemand/pl/ dlod_product.asp

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Although the WRA will provide these new reports on a monthly basis, we urge you to contact your local MLS if you require more specific data for your local market. To view these products, go to www.wra.org/housingstatistics.

news.wra.org


Register Today!

WRA Distance Learning On Demand

Key Features

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Members: $27/course Nonmembers: $35/course

Notes Tool Take notes while you watch your videos.

Outline Tool Navigate and jump quickly to specific topics.

Practice Quizzes Sharpen your skills with review exercises.

Full Screen Video Watch in compact or full screen modes.

Powerful Controls Cue videos with pinpoint accuracy.

Distance Learning On Demand gives you the autonomy to take courses on your schedule – at your own pace – anytime – anywhere. All you need is a web browser and broadband connection. Online education means no travel and no sales downtime. Be ahead of the curve and get education in the most convenient way possible. Ask today about our four and six pack specials.

MORE AT WRA.ORG/DLOD

Copyright 2010 Wisconsin REALTORS® Association. All rights reserved.


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December 2010 - Wisconsin Real Estate Magazine  

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