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If a real estate practitioner commits two or more violations of the NAR Code of Ethics in a three-year period, the person’s name will be released by the local association so that you and other professionals in the industry can see who they are. A picture of the violator and a description of what they did wrong will also be released.

This change is based on a pilot program that the CALIFORNIA ASSOCIATION OF REALTORS® tried over a four-year period. During the trial, the association found a decrease in ethics violations, according to Deborah Dwyer, chair of NAR’s Professional Standards Committee and broker-owner of Dwyer Agency in Pittsfield, Mass. The NAR Board of Directors last month voted to end the California program and turn it into a national program that will start next year.

According to Dwyer, the change has been long-sought by brokers, sales associates, and associations. “This is what people have been wanting for so long,” says Dwyer. “Right now, we don’t know who the violators are, because it’s not published. We’re hoping that, once it starts happening, and REALTORS® out there realize what can happen, they’ll be more professional.”

Release of the person’s name, photo, and what the violations are will be kept within the industry, not released to consumers, she says.

Dwyer says she expects all local associations to opt in to the new rules, so the program will truly be national in scope. “I can’t imagine why any association wouldn’t opt in,” she says.

Dywer talks about the program in the latest Voice for Real Estate video.

Also covered in the video is an update on the competition workshop the federal government held in Washington in early June. The workshop was hosted by the U.S. Department of Justice and the Federal Trade Commission. About a dozen industry executives, academics, technologists, and legal specialists debated whether the residential brokerage industry is as competitive as it could be because of advances in technology. Views differed, as you would expect, but many of the participants agreed the industry has seen a lot of competition-driven change in the last decade, and by some estimates, more than half of all brokerages offer some kind of non-traditional service to consumers. That means most brokerages make available some kind of option that involves discounted fees or limited services or some combination of the two.

The video also looks at the banking legislation President Trump signed last month. It eases some reporting and other requirements on community banks, and there’s an expectation that mortgage financing could become a little less expensive for some borrowers as a result. The new law also puts in place a mechanism that could lead to use of alternative credit scoring criteria like rental payment history, and small homebuilders might have an easier time getting construction loans.

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The chair and co-chair of NAR’s Real Property Valuation Committee made a few remarks on video about NAR’s appraiser independence policy last week during the 2018 REALTORS® Legislative Meetings in Washington. What sparked the remarks was a recent working paper on appraisal quality by two researchers with the Federal Housing Finance Agency.

In the paper, the researchers say appraisals ordered by appraisal management companies are not overvalued at a higher rate than other types of appraisals. There were some differences, though. First, when AMC appraisals come in overvalued, they tend to come in overvalued by a higher amount that other appraisals. Second, AMC appraisals tend to use more comparables.

Rebecca Jones, chair of NAR’s Real Property Valuation Committee, says she’s not surprised by the findings. “A lot of us boots-on-the-ground appraisers have known this sort of thing for a long time,” she says.

The committee’s vice chair, David Griffith, said AMCs are just one way the industry can promote appraiser independence. “We support the use of AMCs as an option to help with appraiser independence,” he said. “We also support the alternatives to AMCs.”

Griffith said the paper also acknowledged that the turn time with AMC appraisals tends to be longer, and that’s something to be considered. “Instead of going directly through the lender, you’re having to go through a third party, and this can cause delays in your turn time from when that appraiser goes out ands does the appraisal to when the lender actually gets the appraisal,” he said.

Click the image above to watch the 5-minute video.

Previous remarks on AMC appraisals.

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Property management software company App Folio is hosting a sponsor webinar on June 20 to share ideas on managing maintenance requests as temperatures rise this summer. Here’s what the company says about its webinar:

With the hottest months of the year just around the corner, are you ready for the maintenance requests that are about to come in? From broken A/Cs, failed refrigerators, clogged pool filters and of course, the rest of the usual maintenance issues that arise throughout the year, handling them on top of the rest of your daily work can be quite the challenge.

Don’t worry; we’re here to help! AppFolio experts Jerry Cohen and Ali Herron have exciting things to share with you when it comes to managing maintenance, such as:
Current industry trends
Streamlining the request process
Managing work orders
Preventative and seasonal maintenance

Who Should Attend?
Anyone in the residential property management business who is tired of spending their time taking calls and micro-managing maintenance requests should attend to find out how they can use technology to be more effective and efficient in their workday while boosting their customer service levels and keeping renters happy.

Ali Herron

Jacob Cohen

Speakers:
Jerry Cohen, Senior Product Manager, AppFolio
Ali Herron, Manager, Contact Center and Value Added Services, AppFolio

Register.

This is a sponsor webinar. REALTOR® Magazine is promoting it, but it has not reviewed the content and is not endorsing it.

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Ixact Contact is a software company that offers CRM and email marketing products to real estate professionals. It’s hosting a webinar on Tuesday, May 22, at 2 p.m., Eastern time, on using its CRM product to grow your business. Shannon McGee, the company’s sales manager, is the speaker.

From Ixact:

Wondering exactly how a real estate CRM can help you better manage and grow your business? Join this information-packed webinar and see specific real-world examples of how a robust real estate CRM can make it easy to keep in touch and stay on task with all your clients, prospects, and important referral sources.

In this webinar, IXACT Contact executive Shannon McGee will show you how IXACT Contact’s real estate CRM can help you to:

1. Keep in touch effortlessly with everyone in your database so you stay top of mind.
2. Ensure that you never miss another client birthday or move-in anniversary – both excellent relationship building opportunities.
3. Nurture and stay top of mind with all your prospects so you get the listing and not your competition.
4. Identify high quality leads – hiding in your database!
5. Stay organized and in control of all your listings, closings, and active buyers.
6. [BONUS!] Create a professional online presence and generate leads with your own customizable, mobile friendly, agent website.
7. [DOUBLE BONUS] Double your social media lead generation with automated social media content posting!

Register.

This is a sponsor webinar. REALTOR® Magazine is promoting it, but it’s not participating in it, hasn’t reviewed the content, and it’s not endorsing it.

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While the Fair Housing Act’s purpose—barring discrimination in the sale, rental, or financing of residential property—may be easy to understand, navigating the many intricacies of the landmark statute can be tricky even for experienced real estate professionals, said experts on the 1968 law who spoke during a recent event in Fairfax, Va.

The event served as a commemoration of the 50-year anniversary of the signing of the Fair Housing Act, and was organized by the Fairfax County of Human Rights and Equity Programs and sponsored by the Northern Virginia Association of REALTORS®, Legal Services of Northern Virginia, and the Prince William County Human Rights Commission.

Panelists talk about the Fair Housing Act during a training session in Fairfax, Virginia.

The challenges stem from the fact that the law requires real estate professionals to ensure their clients not only have equal access to properties, but also that they drive the selection of the neighborhood or home they want to live in. Even a well-meaning effort to match a client with property you think they would like can have legal consequences.

For example, if you are working with a Korean family that is looking for a home to purchase, taking them to neighborhoods where you know other Asian-Americans live could run afoul of the law if the clients did not specifically ask to go to those neighborhoods. That’s according to attorneys from the Department of Justice’s Civil Rights division and Legal Services of Northern Virginia who served on the panel.

Panelists also advised caution when taking steps aimed at ensuring the safety of your clients. While it might seem reasonable to steer a family with young children away from a home they are looking to buy or rent that has lead-based paint, for instance, doing so would violate the law if the family was aware of the presence of the paint and still wanted to live there. It’s not against the law to market homes with lead-based paint to families with children and let them live there as long as they have been made aware that the hazardous paint is present.

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Professional appraisals are the foundation on which stable real estate markets are built, so ensuring appraisers are able to do their jobs to the best of their ability is vital to the industry. That’s why a report from the federal government on appraisal quality is welcomed. The Federal Housing Finance Agency found that appraisals ordered by appraisal management companies, AMCs, are no more likely to be overvalued than appraisals ordered directly by the lender.

“The results indicate no clear evidence of any systematic quality differences between appraisals associated and unassociated with AMCs,” the FHFA report says.

AMCs are entities that enable lenders to maintain an arm’s length distance between them and the appraiser. They’ve been a part of the industry for decades but it wasn’t until after the mortgage crisis about a decade ago that their use became a big part of the industry. That’s because the Federal Housing Finance Agency entered into an agreement with the state of New York to encourage their use for Fannie Mae and Freddie Mac transactions. Once their use in New York was set, Fannie and Freddie extended it to all of their transactions, making the use of AMCs a national policy. Later, their use became even more standardized by the federal government.

NAR takes the position that AMCs are one way to encourage appraiser independence.

The FHFA’s report is a top segment in the latest Voice for Real Estate news video from NAR. The video also looks at the upcoming General Data Protection Regulation from the European Union. The rule takes effect later this month and while most web companies have been aware of the rule for a while, for many people it comes as a surprise and they wonder if it’s something they have to concern themselves with. The short answer is, they probably do. That’s because the E.U. has said it plans to enforce it across the board, which means it could try to take action against a company even if it’s American and caters to Americans.

Under the rule, anyone who resides in the European Economic Area is entitled to certain privacy rights. Thus, if you have a website and a European resident comes to it to, say, browse listings, you can’t put a data-tracking cookie on their computer without getting their permission upfront. Right now, that permission is implied and they have to choose to opt out. So, this rule flips current U.S. practices on their head. Instead of them opting out, you have to ask them to opt in.

The rule requires other things as well, but, bottom line, expect to make changes to how you track people who come to your site.

You can expect lawsuits once the E.U. tries to enforce the rule in the United States, but separate from that, large web operations that want to cater to as many people as possible are probably going to make the changes regardless of what the E.U. does. Eventually, that will change the standard in this country.

The video also looks at the latest home sales figures, which are up, despite persistent inventory shortages, and an upcoming webcast NAR is hosting to let people know what REALTORS® will be talking to members of Congress about when they come to Washington for the 2018 Legislative Meetings later this month. There are four talking points: indexing some tax reform provisions to inflation, reauthorizing flood insurance, improving Fair Housing, and protecting net neutrality.

Watch video now.

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What authority does the European Union have over your real estate business? That’s a tricky question, but an E.U. rule that takes effect next month could end up affecting your business in some manner. That’s because any European that comes to your web site to browse listings will be covered by what’s called the GDPR. That stands for General Data Protection Regulation and it won’t let your web site drop a cookie on a European’s computer unless you get affirmative consent. That means a box that says something like, “We use cookies. OK if we put one on your computer?,” has to pop up when someone from the European Economic Area comes to your web site. What’s more, if you process data on a European you have to be ready to delete that data if you’re requested to. That means you have to have a way to identify  that data so you can take the action requested.

As you can imagine, how the EU would enforce this is a big, unanswered question. There will probably be litigation, too. So, it’s possible it will be a while before anything actually happens that affects U.S. businesses. But there are other things to keep in mind. First, the United States might align its rules with the E.U. Second, regardless of that, many U.S. businesses might align their online privacy and security  practices with the E.U. model, regardless of enforcement. That means you’ll probably see more U.S. companies asking for affirmative consent when anyone comes to their web sites. Third, there could be alignment with European rules on data processing, too.

This is all speculation. The rule is real but it’s actual impact here can’t be fully known yet. But you can see where things are heading and it’s not a bad idea to take steps to be prepared for however things shake out.

NAR will be hosting a Facebook Live webcast next week, on Tuesday, April 24, at 1 p.m., Central time (2 p.m., Eastern time) to walk you through what’s happening and what you might do to be ready. The presenters will be Finley Maxson, NAR senior counsel, and Liz Sturrock, NAR vice president of information technology. They’ll be talking with Meg White, managing editor of REALTOR® Magazine.

You’re encouraged to ask questions. Here’s more information on the event: EU Privacy Rule: Are You Impacted?

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Federally backed home loans from the Rural Housing Service have been called one of the the government’s best kept secrets because buyers can get safe, affordable mortgage financing in areas where few other loan options are available. The underwriting requirements are considered both strong and reasonable, and, maybe most important, homes that wouldn’t be eligible for loans by conventional lenders are often eligible under the federal program. That’s because RHS recognizes that in rural areas, houses are not always built to meet the needs of suburban or urban buyers. The agency’s old name—Farmers Home Administration (FmHA)—says a lot about where the agency is coming from.

That’s why it’s significant that the U.S. Department of Agriculture, which oversees RHS, undertook a reassessment of what constitutes a rural area. That assessment was just completed and in about two months—June 4—a new map of rural areas takes affect. When it does, some areas that used to be considered rural are no longer considered that. One example is Ashburn, Va. Like so many areas in Northern Virginia, it’s being swallowed up by the D.C. metropolitan area. It’s now another suburb.

That means households who might struggle to get financing to buy a home can no longer count on direct or guaranteed loans from RHS. They’ll have to find conventional financing or maybe try FHA.

The good news for buyers in many of these new suburbs is their choice in lenders has probably increased along with the area’s population. In other words, maybe RHS is less needed now, because conventional lenders have moved in to take advantage of the area’s growth. But every area is different. There are probably a number of areas where the choice in lenders hasn’t kept up with growth, so the RHS loans will be missed.

In any case, it makes sense to learn if your area has been affected. The latest Voice for Real Estate news video from NAR talks about this and walks you through how you can see the status of your area.

The video also looks at some things FEMA is doing to encourage growth in private flood insurance options. Thanks in large part to a new consumer advocate in the Federal Emergency Management Agency, the agency said it will allow homeowners to drop their federal coverage and get private coverage instead without incurring any penalty. Prior to this change, you couldn’t do that. You had to keep your federal coverage even if you found cheaper or better private coverage. That consumer advocate, by the way, is there in large part thanks to NAR, which made sure it was part of flood insurance reform legislation that passed a few years ago. We’re now seeing the benefits of that.

In another change, insurance companies that offer the federal coverage can now also offer a private alternative. Again, that wasn’t allowed before. There are a few more improvements like that. The video walks you through them.

Also in the video is an update on competition in the real estate industry. You might recall that it was 10 years ago that NAR and the U.S. Department of Justice entered into an agreement to make sure virtual office websites (VOWs) are treated the same as brick and mortar brokerages in obtaining MLS data to share with people. That agreement expires later this year and the first of two workshops was held in Washington looking at the state of competition today. NAR Associate General Counsel Ralph Holmen (retired) participated in that workshop and made the point that the VOW business model wasn’t a big part of the market 10 years ago and is even smaller today, in part because it involves creating a client relationship with people who want to look at listings on your site. For many brokerages, it’s easier just to offer up listings without having to set up that client relationship first. NAR has said it doesn’t plan to change its VOW policy when that DOJ agreement expires.

The video also excerpts from the NAR Broker Summit that was held in Nashville earlier this month and also introduces a monthly video series NAR is launching for the year, Fair Housing Focus. The video is part of NAR’s recognition of the 50-year anniversary of the Fair Housing Act.

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When the Trump administration released its $1.5 trillion infrastructure plan last month, it set in motion a multi-year process that could eventually lead to considerable investment in communities. Of course, Congress must pass legislation to make much of it happen. Although there are some parts that the administration can do on its own, a lot of the plan will require both authorizing and funding legislation, so how close we get to that $1.5 trillion goal is dependent on what lawmakers can agree on in the next year or two.

Regardless, with the country’s roads, bridges, waterways, dams, and other public projects aging, some projects will be getting funds in the years ahead whether or not the plan is all or partly enacted. The question for you is, how will you get involved? Will you get involved upfront, when projects are in the planning stages, or will you get involved after projects get going? Often, bridge replacement means land transactions, because it’s not unusual for a replacement bridge to be built alongside the existing bridge. That means government might have to acquire or condemn nearby property. Or if a road is widened—will that involve acquisition or condemnation of land?

Property values tend to go up after infrastructure improvements are made. In northern Virginia, expansion of the metropolitan subway system had a tremendous impact on property values along the new tracks. Huge condo, apartment, retail, office, and mixed-use projects followed. It triggered a real estate boom.

The administration’s infrastructure plan is featured in the latest Voice for Real Estate news video from NAR. Access that segment now.

The video also looks at why NAR supports the banking reform bill that passed the Senate a couple of weeks ago, why passage of long-term reform of federal flood insurance is just as much about improving communities as it is about continuation of insurance policies, and why Congress needs to make mortgage debt forgiveness relief a permanent part of the tax code. Cyber crime and association health plans are covered, too.

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Steve Spano, president and chief operating officer of the Center for Internet Security, recently visited NAR’s Washington offices to discuss techniques real estate professionals can employ to stay safe online. Listen to his comments below.

Audio: Cybersecurity Tips for Real Estate Pros - YouTube

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