TheREALTYgram Blogger

Real Estate Agent Accused Of TheftAt More Than 30 Homes In California

The National Assn. of REALTORS® has launched a very expensive public awareness campaign to spread the gospel about the good works of its members. PR like this is likely to fall on deaf ear in places like Irvine, CA, where a real estate agent, perhaps looking for creative use of a lockbox key, was recently arrested  for a series of some 30 home thefts involving more than $50,000 in property. The property was recovered in her Big Canyon Home. This news tidbit appears courtesy of The FSBO Blog (Ouch!).

NAR Doublespeak On Preempting State Law:YES for Insurance Industry, NO For Banks

The National Assn. of REALTORS® takes two positions on the issue of preempting state law. It is an advocate of preemption by virtue of its support of the "Small Business [Un]Fairness Act", legislation that will let associations circumvent and circumcise state regulations in health care benefit delivery. It opposes preemption, however, in the matter of banks gaining entry into the real estate sales arena. NAR has requested an opportunity to testify before the Federal Deposit Insurance Corp. (FDIC) about a petition by the Financial Services Roundtable to issue preemption regulations for state banks. NAR lists the following concerns:

1. potential negative impacts on consumers in states with strong consumer protections,

2. disregarding federalism principles by broadening preemption of state laws, and

3. the risks of increased industry concentration and reduced competition.

Interestingly enough, those same concerns are the ones cited by consumer advocates in the matter of Association Health Plans.

FHA Offers Hybrid Adjustable Rate Mortgage

The U.S. Dept. of Housing and Urban Development has announced a five-year hybrid adjustable rate FHA mortgage with interest rates adjustable up to two percentage points annually (this type of mortgage is known as a 5/1 ARM). The lifetime cap on annual interest rate adjustments for five-year ARMs is set at six percentage points.

Landlords And Apartment DwellersShare Connectedness In Blogosphere

Web developer NetImpaxx LLC (Washington, D.C.)  has launched BuildingBlogz, designed to let apartment owners offer weblog service to their tenants. The web site cite a design charge of $1,400 and $49/month hosting fee. Optional discussion categories include Pet Talk, Politics, Trash or Treasure, and From The Management (required). Sample blog here.

Justice Prevails In Pacific Northwest;Mortgage Fraud Culprits Sent To Prison

John Hansen, a Washington State real estate appraiser, was the final culprit in a mortgage fraud ring to be sentenced (MortgageFraudBlog). He was ordered to spend 18 months in federal prison followed by three years of supervised release and ordered to pay restitution of $287,796. Hansen pleaded guilty to conspiracy to commit wire fraud last year in connection with the Century Mortgage fraud in Washington.  According to authorities, Hansen inflated appraisals on homes purchased by vulnerable homebuyers. The Seattle Times reports the following:

Former Century Mortgage co-owner Dale D. "Sage" Gibbons was sentenced to five years in prison and ordered to pay $449,953 in restitution. He was convicted in July on 16 counts of wire fraud.

Former real-estate agent Sally L. Gibson, who sent home buyers to Century Mortgage for financing, was sentenced to 30 months in prison and ordered to pay $264,406 in restitution. She was convicted of a dozen counts of wire fraud.

Co-defendants Ronald Lee Burger and Cathy M. Patrick pleaded guilty to wire fraud and testified against Gibbons and Gibson.

Burger, also a co-owner of Century Mortgage, was sentenced to 37 months in prison and ordered to repay $423,011. Patrick, a closing agent, was sentenced to 60 days in jail and three years' probation and was ordered to repay $148,340.

In the home-sales fraud conspiracy, scores of people bought houses for far more than market value, then found themselves facing balloon payments, high interest rates, foreclosure and even bankruptcy.

 

Racial Homeownership GapsRemain Sizeable And Persistent

Twenty years of efforts to bridge the racial gap in housing have yielded little or no results. While there has been an overall increase in homeownership since the 1980s, there is still evidence of sizeable and persistent racial home ownership gaps, according to research at the University of Southern California Lusk Center for Real Estate. Substantial gaps in homeownership rates between whites and minorities persisted, averaging roughly 26 percentage points for blacks and 28 points for Hispanics. In the second quarter of 2004, homeownership rates reached 69 percent nationwide, with 76 percent for non-Hispanic whites, 50 percent for blacks and 47 percent for Hispanics.

"Homeownership increases are driven by such factors as household income, age, size of the household, full-time work, marriage and inheritance," Lusk director Stuart Gabriel, Ph.D, points out. He adds that there remains a need to boost minority homeownership not only because it's often a wealth generator, but also because research has shown that homeownership can help to revitalize neighborhoods by reducing crime and blight, increasing price appreciation and improving outcomes for children. "Clearly, the benefits of homeownership can extend well beyond the build-up of equity to help revitalize communities," explains Gabriel.

Gabriel offers several steps that industry can take to increase minority homeownership including better access to credit, a look at loan pricing for minority and underserved communities, expanded use of alternative credit lines, and revitalization of existing housing stock in urban areas.

National Real Estate MLS Search EngineLeaves The Station In San Diego

Consumers have a new search engine for finding properties across the U.S. RealTown Public Listings Search offers real-time MLS searching capabilities from coast to coast. (Users of Realtor.com frequently complain that the data is "old" and not refreshed often enough.) The new site is published by Internet Crusade, a group with a proven record for service delivery in the real estate Internet marketplace. New areas are added to the map as they are reported, according to IC.  A REALTOR® recently offered this review of the new site:

"This IS what Realtor.com SHOULD be. The 'kindler, gentler', Realtor.com that accomplishes the same thing as the Frankenstein version. Level playing field for everyone, no BS, no..........well, see for yourself."

Civil Rights Leaders Decry Lending Bill;... And The March Goes On

Civil rights activists have come out against the euphemistically titled "Responsible Lending Act ."  The Rev. Jesse L. Jackson, NAACP chairman Julian Bond, and Wade Henderson, executive director of the Leadership Conference in Civil Rights, have added their names and voices to help consumer advocates defeat a bill that would preempt  state or local laws that afford additional substantive protections. The bill would also wipe out a recent regulatory ruling mandating that state-chartered thrifts and independent mortgage companies cannot evade state limits on late fees and prepayment penalties on adjustable-rate mortgages and other alternative loans.

"Representatives Ney and Kanjorski have failed to provide meaningful protections in their mis-named 'Responsible Lending Act,' " said NAACP chairman Julian Bond. "Their bill demonstrates a failure to address the real pain caused by predatory lending and the harm it is doing to African-American families."

The Washington Post reports:

"The civil rights groups contend that the Ney-Kanjorski approach falls far short of what is needed to stop abusive lending targeted at minorities, the elderly and immigrants and instead removes protections in existing federal law and in state and local regulations. The states and local jurisdictions have been passing laws since about 1999 as lending to subprime, or higher-risk, borrowers has exploded. Although not all subprime lending is predatory, complaints about abusive lending, with hidden or excessive fees and deceptive practices, have skyrocketed as higher-cost, subprime loans have become available."

Landlords Ordered To Pay $84,244For Failure To Issue Lead Paint Warning

The owners and the management company of four residential apartment buildings in Richmond, Va. have been found guilty of violating a federal law requiring disclosure of lead-based paint hazards to residential tenants. The judge assessed penalties for the five respondents totaling $84,224, the largest penalty ever assessed in the country in an EPA administrative hearing for lead disclosure violations, more than doubling the previous high penalty. The lead disclosure rule requires that owners, landlords, and agents renting or selling residential property built prior to 1978 must disclose to tenants or purchasers information pertaining to lead-based paint. All of the above properties were built prior to 1978.

“Lead poisoning can be prevented. If parents are concerned that their children may have been exposed to lead-based paint, they can get their homes and children tested, and learn preventative steps that can be taken to avoid lead poisoning,” said Donald S. Welsh, EPA regional administrator mid-Atlantic region.

Renters for five of the 10 apartments had children under the age of six when they entered into the lease. The other five renters had children ranging from seven to 15 years old at the time they entered into the lease. Children under age six are especially vulnerable to the dangerous effects of lead poisoning which can impair their neurological development.

Statistics Reveal The Shocking Truth Behind Real Estate Agent Qualifications

The National Assn. of REALTORS® is touting membership of some 1.2 million nationwide, but not all of the rank and file are cheering. There is a great deal of discussion among real estate professionals about "thinning the herd." Anthony Marguleas of A.M. Realty in Los Angeles, who is currently working on a book about the secrets and myths of the real estate industry, has conducted research into the time it takes to become a qualified real estate agent, versus other professions. The results, he says, make shocking reading.

Of 20 professions he compared, from pilot to plumber, from teacher to chiropractor, a real estate agent could qualify to sell homes as a professional to the unsuspecting public with a mere 48 hours of training (in California; other states vary). The next lowest was an esthetician or beautician, who required almost 12 times more training: 600 hours, followed by a police officer, required to complete 1120 hours of training to qualify for their job. A hair stylist has to complete 1500 hours of training, a chiropractor 3840 hours, a CPA undertakes 5980 hours. Says Marguleas:

"It confirms the beliefs that the public has about the generally low level of professionalism that is still rampant in the real estate industry. Most people consider a 'professional' to be an 'expert'- someone who has undergone specific training for their career and has a certain level of knowledge and experience too.

"The fact is that many people are becoming real estate agents with a minimum of training -- because the industry makes that possible -- in order to make a fast buck. Many real estate agents don't have much grasp of the business at all, let alone the intricacies: keeping on top of changes in legislation, for example. The typical real estate agent probably started out in another occupation and either wasn't making enough money, lost their job and couldn't find another in the same area of business, or just decided to 'give it a go.'".

"In California, the number of REALTORS® has increased 44% in the last five years. Now there are almost 400,000 people with real estate licenses in California, 66,000 of them in Los Angeles. "In the early part of 2004, the number of real estate agents in Los Angeles outnumbered properties for sale at a ratio of 7:1. These figures make for a cut-throat industry."

Given that real estate agents are assisting people with the most important -- and usually the most expensive -- purchase of their lives, Marguleas believes that the training to become a real estate agent should, at the very least, be equal to that of a stock broker (1920 hours).