JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 1

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1 JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 1

2 IMPORTANT REMINDERS GEPAR QUARTERLY BILLING SCHEDULE 3RD QUARTER BILLING 07/05/2011 Suspension and $50.00 reconnect fee 08/01/2011 Suspension of office if members are past due w/active license. 09/01/2011 Termination of office if members are past due w/active license. 4TH QUARTER BILLING 8/15/2011 Invoices posted to agents invoices ready to view & pay online 8/31/2011 4th quarter payments due 10/03/2011 Suspension and $50.00 reconnect fee 11/01/2011 Suspension of office if members are pastdue w/active license. 12/01/2011 Termination of office if members are pastdue w/active license YEARLY DUES WILL BE BILLED THE 1ST WEEK OF NOVEMBER, 2011 AND ARE DUE DECEMBER 31, 2011 E L PA S O R E A LT O R. C O M ASSOCIATION OFFICERS - Linda Bastraw [ President ] - Jennifer Stroh [ President- Elect] - Kenny Gross [Secretary/ Treasurer ] - Doug Hamilton [ Immediate Past President ] - Sharron K. Ramirez [ Chief Executive Officer] ASSOCIATION DIRECTORS - Caroline Camfield - Susan Craig - Mackie Sue Gilchrist - Andrew Haggerty - Douglas Van Nortwick 6400 GATEWAY EAST BLVD EL PASO, TX, (915) ASSOCIATION DIRECTORS Timothy Cantrell - Socorro Cochran - Jim Howard - Mickey Molina - Patti Olivas MLS BOARD OF DIRECTORS - Rick Snow [ President ] - Angel Ochoa [ Vice President ] - Jesus Barraza [ Secretary/ Treasurer ] - David Curiel - Art Moreno - Jim Howard - Robert Lozano - Frances Moran - William R. Stanton TAR Nominating Committee - Sonja Van Nortwick NAR DIRECTOR - Michael Bray TAR DIRECTORS - Linda Bastraw - Doug Hamilton TAR REGIONAL VICE PRESIDENT - R. Scott Kesner DON T FORGET PAGE 4 & 5 TAR TREPAC TRUSTEE - Elizabeth Leal POLITICAL INVOLVEMENT COMMITTEE - Al Jurado COMMITTEE CHAIRMAN - Kenny Gross [ Budget & Finance ] - Steve Carvalho [ Education ] - Alma Miller [ Fair Housing/ Equal Opportunity ] - Al Jurado [ Governmental Affairs ] - Socorro Cochran [ TREPAC ] - Angela Ochoa [ REALTOR / Builder ] 2 elpasorealtor.com El Paso Realtor Magazine JUNE 2011

3 > EXPERT ADVISORS Going on at GEPAR Our Association has been quite a hub of activity lately drawing many members attending programs put on for our membership at little or no cost. At the May CIBA meeting, they brought in home inspector Ron Futtrell who gave a talk on home inspections, followed by a question and answer session. Also, in May, the Education Committee gave a presentation on contracts that also included a question and answer period. That was followed by a Bank of America seminar on short sales, foreclosures and the FHA 203K program the following week. All three events packed the auditorium room at GEPAR to capacity, showing how many members take our profession seriously and want to keep informed on issues which are relevant. FOLLOW UP TO CONTRACT PRESENTATION As previously mentioned, the Education Committee provided a class on contracts and there were a couple of issues I wanted to follow up with. One such question addressed Third Party Financing Addendum For Credit Approval Addendum. To reiterate, the purpose of this addendum was not to require the buyer obtain financing within the number of days inserted in the first paragraph but rather to give the buyer an opt-out period when that buyer does not believe he can obtain that approval. If the buyer does not believe they can obtain their financing approval before the time constraint expires, they would utilize the TREC promulgated form Notice of Buyer s Termination of Contract. One of the issues discussed regarding the Third Party Financing Addendum was what happens if the buyer is approved for the loan but the property s appraisal does not meet the sales price. The lender s approval of the property, based on their underwriting requirements which could include the appraisal, any lender required repairs and more, is a separate issue from the buyer s ability to qualify, so the contract would terminate. It is important to keep the two issues, buyer s ability to qualify for the loan versus loan underwriting requirements, separate. A very good question that was asked was If the seller comes back to the buyer and states they will sell for the appraised value, does the buyer then have to close? The answer is no. Based on the loan appraisal not meeting the sales price is basis for the buyer terminating the contract and it becomes the buyer s choice whether they want to proceed with the closing when the seller states they will sell for the appraised value. This situation came up with a sale involving my office a couple of years ago, and TREC s legal counsel verified to me that even if the seller offers to sell at the appraised value, the buyer does not have to proceed with the contract and would be entitled to the refund of their earnest money. The Third Party Financing Addendum is one of only two instances where time is of the essence applies to the contract. The other instance involves the Option Period Paragraph. OPTION PERIOD This paragraph gives the buyer the unrestricted right to terminate the contract within a time period that buyer and seller agree upon. Nowhere in the paragraph is the word repairs mentioned but this paragraph was designed, in part, for the buyer and seller to negotiate any repair issues. During our contract class, the question was asked if the buyer could ask for repairs to be done after the termination of the option period. The correct answer is yes, they can ask for anything they wish, however, the buyer is under no obligation contractually to consent to anything at this point. The expiration of the option period nullifies the buyer s unrestricted right to terminate the contract. Also, for the option period to be effective, the option fee must be tendered to the seller (to include the seller s agent and/or broker) within two days after the effective date of the contract. The following excuses do not mitigate failure to deposit the option fee: But it is Christmastime (no holiday is exempt), Gee, no one has enforced this with me before, My grandmother died, My dog ate the check. By not tendering the option fee to the seller or their agent within the two day period, your buyer has just surrendered their right to terminate the contract. Be sure to be diligent about the option fee and remember, TREC starts the clock on all timelines the day after the effective date on the contract. I welcome your comments and questions to Steve@SteveCarvalho.com. S T E V E C A R V A L H O, C R S G E P A R N E W M E M B E R E T H I C S I N S T R U C T O R JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 3

4 4 elpasorealtor.com El Paso Realtor Magazine MAY JUNE 2011

5 Why are we switching to new lockboxes? Our current system has been in place since 2005 but many of the existing lockboxes require extensive maintenance from GEPAR staff. In addition, our contract with SentriLock has expired and there is no warranty or support services without a new contract being executed. The lockbox task force felt the new Sentrilock product had greater durability and would serve our membership for a longer period of time than the current lockboxes. Are the batteries from the old lockboxes compatible with the new lockboxes? No they are not, but the new batteries which are CR123 Lithium batteries have an estimated life expectancy of five years. With the new lockboxes in place, you will not have to worry about trying to access an old lockbox with a dead battery. We heard from several members that this was becoming more a regular occurrence when showing properties. How difficult will it be to learn the new system? The system is not new, but is an upgrade of the system we currently utilize. The training classes are simply offered at the time of the lockbox conversion to showcase the many new features of the system. Our members will receive new Sentricards, and if your photo was in GEPAR s system, it will be placed on the new Sentricard. Will our lockbox fees go up on the new system? No. Any user fee increases are set each year by our Association when the budget for the coming year is established. The upgraded system will not see any type of increases for our membership. The Task Force worked diligently to ensure that fees would not increase at the current time for our membership. Did the Task Force look at any other systems other than Sentrilock? Yes, the Task Force also looked at the other industry provider, Supra. We met with representatives from both providers and were shown the choices for products. Supra, while having a series of great products, would have been substantially more expensive and would have required more initial cash output as well as raising user fees. Was the inconvenience to the members during the week of the conversion considered? It certainly was, and while there was no perfect scenario for the conversion, the convenience factor to our members will increase at least tenfold. Under the old system, our members would have to go out and read lockboxes individually, go back to their office, and download the data, and then return to read the next lockbox. This procedure could involve more than a day s work as well as driving throughout the city expending time and gasoline. The new system will require the Sentricard to be updated once a week, which means that a listing agent will be able to gather data on their lockboxes once a week without having to go out and read the lockboxes individually. What is really impressive is that Sentrilock will send notifications, via , to the agent letting the agent know who has shown their property. This feature alone means a huge time and money savings for the listing agents throughout the entire year. If I have 10 lockboxes, will I receive 10 lockboxes at the conversion? In order to establish a better system for tracking the lockboxes, the amount of lockboxes given will match the number of listings the agent has, as long as the old lockboxes are exchanged. An agent can acquire more lockboxes after the conversion, if desired. If I am given a lesser number of lockboxes than I turn in, what is my incentive for turning old lockboxes in? One of the points of negotiations to receive new lockboxes without raising user fees was that we guaranteed that we would return a significant number of the old lockboxes. The entire cost to receive new, improved product for our members was predicated on the old lockboxes being returned. Can I still use my old lockbox card after I have been given the new one? No, once you receive your new card, the old card is disabled. What do I do if I am out of town during the lockbox conversion? Could someone else pick up my lockboxes and new keycard for me, including my broker? Knowing there would never be a day where everyone could attend, the Task Force recommended that if proof of being out of town, such as an airline ticket, travel voucher, hotel bill, etc., was provided, the late fee would be waived. No one can pick up lockboxes or a keycard other than the agent the keycard and lockboxes are assigned to. Will new card readers be required after the conversion? No, existing card readers will be compatible with the new system. Additional card readers will be available for sale after the conversion process in the Membership Department at GEPAR. JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 5

6 By now many of you have heard about the REALTOR Party Political Survival Initiative. No? How about the $40 dues increase for NAR? Yeah, THAT rings a bell! I have to admit it, when I first started hearing about this it seemed to be all about a possible dues increase. As expected, the reaction was swift, it was loud, and it was negative. A number of third party surveys were taken and reported in the blogospheres. Overwhelmingly it was reported that membership felt that NAR Leadership was out of touch with the members. Not surprising considering the way the survey questions tended to be phrased. Developing an unbiased survey is something of an art form that I learned way back in my college days as a Marketing Major (admittedly in the era when the latest new technology out there was the MLS Book). Unfortunately, with today s viral messaging systems (think Blogs and Tweets) an improperly interpreted marketing message can quickly take on a life of its own. I think there is a lesson here that can be learned NAR Boomers need to learn how to communicate with NAR YPNers (IMHO). And you YPNers need to slow down sometimes and try to listen to the sage advice of those who have blazed the paths before you! So here is my attempt to bring some understanding about how I think we have gotten to where we are and it is going to take a little more than 140 characters.. NAR has always acknowledged its responsibility to do all it can to ensure that members have a fair and competitive work environment and that we promote the societal value of real property ownership. NAR s Strategic Plan states: NAR is recognized as THE advocate for legislative, regulatory and legal policies that benefit REALTORS and real property owners. NAR s political influence and grassroots clout to achieve this NAR Strategic Plan objective weredeveloped as a result of a commitment to build relationships with public officials and regulators bycreating an understanding of the importance of real property ownership to American society. REALTOR involvement to influence decisions about property rights issues at the federal, state and local levels of government has been in place for over 40 years and our commitment to fund RPAC requests to help influence the outcome of elections at all 3 levels of government has grown substantially over that time. In that span of time NAR has continued to refine its approach and developed programs such as Calls For Action and Legislative Contact Teams to deliver our message to legislators. In 2008 the NAR Leadership Team recognized that NAR needed to enhance its political influence and clout at the federal, state and local levels by moving the agenda through our Second Century Initiatives. With the leadership of NAR CEO Dale Stinton, a robust set of resources were identified to create a REALTOR Party that would employ new and powerful organizational tools that would provide all three levels of our Organization unrivaled political strength to more effectively help elect REALTOR champions 6 elpasorealtor.com El Paso Realtor Magazine JUNE 2011

7 and successfully advocate REALTOR public policy. And All Was Good.. In January 2010, the U.S. Supreme Court Ruling (Citizens United vs. Federal Election Commission) allowed corporate dollars (dues dollars) to be invested for candidate Independent Expenditure (I.E.) campaigns. Prior to this Supreme Court ruling only voluntary PAC contributions (hard dollars) could be used for federal candidate independent expenditures. The Citizens ruling was a very clear game changer for NAR and RPAC since the hard dollar PAC advantage that the REALTOR family worked for over 40 years to achieve (over more than 4,000 other federally registered PACS) was now likely to be swamped with soft money I.E s being conducted at all three levels of our electoral process. However, this game changing Supreme Court decision also opened the door for NAR to consider additional, new directions for elevating our REALTOR Party influence by using general funds (corporate funds, i.e. soft dollars) while lowering the amount of RPAC hard dollars needed to directly contribute to federal candidates. A comprehensive survey of key REALTOR constituencies was commissioned. The questionnaire was administered to five separate REALTOR groups: 1) REAL- TORS who do not contribute to RPAC; 2) Regular RPAC contributors; 3) RPAC Major Donors; 4) Members of the Young Professional Network (YPN); and 5) Executive Officers. More than 6,400 members participated in this survey. The results reflected the fact that REALTORS were not familiar with the Supreme Court s ruling in the Citizens United decision. Most members have heard very little or nothing at all about the decision. After learning more about the ruling and its impact, members were split on the idea of using general funds to help elect candidates. Over the course of the next few weeks a multitude of approaches and funding sources were looked at. A comprehensive program was developed that coordinated the efforts of our Federal, State and Local initiatives. Details were shared with key staff and leadership at the State and Local levels. At the NAR Midyear Legislative Meetings the NAR Board of Directors was presented with alternative funding sources. Throughout the course of the weeklong meetings I attended several forums to learn more about the program and discuss possible funding sources. And trust me, there were plenty of discussions over beverages into the wee hours of the night! The more I listened, the more I heard that the concerns were not in the mission, but in the way the mission was to be funded. The best alternative seemed to be the one which had all members equally sharing the burden. After all, everyone, including non-realtors, benefit from NAR s stewardship as the Defender of Private Property Rights. Imagine for a moment, what happens to your business if buyers had to come up with a full 20% down before they could buy a house. What percentage of your business dies? What happens to your business if homeowners (including yourself) could no longer deduct the mortgage interest they paid from their income taxes? And could the loss of this deduction stretch them even further towards possibly not being able to afford the home they are in and unable to find a buyer with 20% down? Who is going to buy those foreclosures and short sales? If this was to happen (and there currently is a significant push to make it so) would you lose more than 10 cents a day in income? My favorite Cup o Joe (that s a Frappe Latte como se llama to you YPNers) just went up a dime a cup. I don t like having to pay it but I don t see kicking the caffeine habit just yet. I ll get used to it. If you can find one, ask a travel agent today if they would have gladly invested a dime a day 10 years ago in their industry. Ask an appraiser if they would gladly invest a dime a day in their industry. Ask a mortgage loan originator if they would gladly invest a dime a day in their industry. The attack on housing requires a bold, strong response. IF not NAR, who then? I have lost a deal or two to these new and improved regulations. If I can help save just 1 transaction, my dime-a-day investment has given me a great return. And I don t need any surveys to tell me that! M i c h a e l B r a y, A B R, A H W D, C S P, G R I, T A H S Te x a s R E A LT O R H e r o D i r e c t o r, N a t i o n a l A s s o c i a t i o n o f R E A L - T O R S P r e s i d i n g O f f i c e r, Te x a s M a n u f a c t u r e d H o u s i n g B o a r d V i c e P r e s i d e n t, E l P a s o H o u s i n g F i n a n c e C o r p o r a t i o n M I C H A E L B R A Y JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 7

8 > ASSOCIATION EVENTS M A Y Washington DC Hill Visits On May 12, 2011 members of the Governmental Affairs Committee and the Leadership Team of the Greater El Paso Association of RELATORS meet with members of the Federal Legislative Delegation at the Capital to discuss issues that affect the realtor community. City Council Run Off Endorsements On May 25, 2011 members of the Governmental Affairs Committee and the Leadership Team of the Greater El Paso Association of RELATORS meet with candidates for El Paso City Council Run Off elections to discuss issues that affect the realtor community. After lengthy discussion the committee decided to endorse Lyda Ness Garcia for District #1 and Mayela Mejia for District #5. 8 elpasorealtor.com El Paso Realtor Magazine JUNE 2011

9 + BY THE NUMBERS J U N E C O M P A R I S O N JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 9

10 + NAR ATTACHED PROPERTY H O M E S A L E S R E P O R T NATIONAL ASSOCIATION OF REALTORS Real Estate Trend Indicator Board: Greater El Paso Association of REALTORS State: Texas Date of Report: 06/01/ elpasorealtor.com El Paso Realtor Magazine JUNE 2011

11 + NAR SINGLE FAMILY RESIDENTIAL H O M E S A L E S R E P O R T NATIONAL ASSOCIATION OF REALTORS Real Estate Trend Indicator Board: Greater El Paso Association of REALTORS State: Texas Date of Report: 06/01/11 JUNE 2011 El Paso Realtor Magazine elpasorealtor.com 11

12 > MARK YOUR CALENDAR JUNE 1 8:00 am - Orientation 9:00 am- WCR Board Meeting 1:00 pm- Young Professionals Network Meeting 2 8:30 am- RCA Weekly Meeting 1:30 pm- Gov. Affairs Cmte. Meeting 2:30 pm- TREPAC Committee Meeting 3 11:30 am- WCR Luncheon 6 12:30 pm - Toastmasters 3:00 pm - REALTOR/ Builder Cmtte. Meeting 7 9:00 am- Success Realty Meeting 12:00 pm- CIBA Monthly Meeting 1:30 pm- Education Cmte. Meeting 8 8:00 am- Texas United/ CMA Course 9 8:30 am- RCA Weekly Meeting 10 12:00 pm- REALTOR/ Builder University 13 12:30 pm- Toastmasters 14 1:30 pm- Education Committee Meeting 8:30 Professional Standards 15 1:30 pm- Budget & Finance Meeting 2:00 pm- Executive Committee Meeting 16 8:30 am- RCA Weekly Meeting 11:00 am- TREPAC Bowling 17 11:00 am- Stories of Success (Manny Soto) 20 8:00 am- TX REALTORS Leadership Program 21 8:00 am- MCE 22 8:00 am- MCE 8:30 am- MLS Board of Directors 23 8:30 am- RCA Weekly Meeting 24 8:30 am- Board of Directors 27 Lock Box Conversion 28 Lock Box Conversion 29 Lock Box Conversion 30 Lock Box Conversion 12 elpasorealtor.com El Paso Realtor Magazine JUNE 2011