JUNE | JULY 2013
VOLUME XLVII Number 4
The Maryland Association of REaltors®
www.mdrealtor.org
The Voice for Real Estate® in Maryland
September 9–11
2013
Consumer Website: www.marylandhomeownership.com
19
Economy, Markets Outperform Expectations 5
MAR 2013 Legislative Review
13
2012 Leaders of the PAC
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President’s Perspective
C A R LT O N J . B O U J A I , J R .
Legislative Recap What’s To Come?
A
fter last year’s difficult
Then take a look at our 2012
This issue includes one of our
legislative session, when
“Leaders of the PAC”, (page 13)—
most popular features, the semi-
we successfully fought
they helped elect REALTOR®
annual economic forecast from
back challenges to the mortgage
champions to all three levels of
Anirban Basu of Sage Policy
interest deduction and exclusive
government, making possible
Group, Inc., MAR’s consulting
right to sell contracts in Maryland,
critical support for the issues
economist. Mr. Basu is widely
we anticipated a fair sailing in
that are important to Maryland
recognized as a foremost authority
the 2013 legislative session,
REALTORS® and property
on the Maryland economy. See
which ended in April. How did
owners. We owe them our thanks.
his preview of what we can expect
we do? MAR Vice President of
We’re proud to feature an
in the housing market on page 19.
interview with Donnell Spivey,
Annual Conference registration is
President-Elect of the National
now open, and we’ve got an
Association of Real Estate Brokers
extraordinary lineup of activities and
(NAREB), the nation’s oldest
classes. Turn to page 23 to learn
minority trade group. Donnell, also
more about the nationally
a REALTOR®, will be installed as
recognized speakers and topics that
President this August during at
will be available in Ocean City this
the NAREB National Convention
September. Don’t miss your chance
in Denver. Donnell is a member of
to take advantage of the early bird
the Howard County Association.
registration.
Government Affairs Bill Castelli summarizes the session, the bills affecting real estate, and their outcome, on page 5.
As REALTORS®, we are sworn to abide by the NAR Code of Ethics. Beyond ethics, however, is acting professionally with all parties through a transaction. Good business practices are not only essential to a smooth process. They build good relationships with clients and with fellow REALTORS®, which can lead to more efficient future transactions and even future referrals, as well as more public respect for our profession. In short, professional behavior enhances your personal reputation and your business.
www.mdrealtor.org
His story is on page 17.
MARYLAND REALTOR® JUNE | JULY 2013
1
TA B L E O F CO N T E N TS Features
fickle seas MAR 2012 Legislative Review 5
Leaders of the Pac— 2012 edition
donnell spivey President-Elect, National Real Estate Brokers 17
Economy, Markets Outperform Expectations A Record-Setting First Quarter
Leaders of the Pac—2012 edition
13
13
19
2013 ANNUAL CONFERENCE AND EXPO Bringing It Home 23 MAR LEADERSHIP ACADEMY FORM
35
Departments
5
fickle seas
2
19
Economy, Markets Outperform Expectations
MARYLAND REALTOR® JUNE | JULY 2013
23
President’s Perspective
1
Regulation News
26
Residential Sales
28
Maryland Real Estate Commission News
31
HOMEOWNERSHIP SNIPPETS
32
From the Hotline TITLE TO COME
34
2013 ANNUAL CONFERENCE AND EXPO
www.mdrealtor.org
2013 Maryland Association of REALTORS® Leadership Team Maryland Association of REALTORS® 200 Harry S Truman Parkway | Suite 200 Annapolis, MD 21401-7348 800.638.6425 | www.mdrealtor.org
Executive Leadership Team
Carlton J Boujai Jr
J Russell Boyce
President EXIT Realty Prosperity Group 5300 Westview Drive Suite 105 Frederick, MD 21703-8339 301.698.8700 carltonboujai@mris.com
President Elect RE/MAX 100 10665 Stanhaven Place White Plains MD 20695-3062 301.843.5100 russboyce@remax.net
Carlton J Boujai Jr | President J Russell Boyce | President Elect Janice R Kirkner | Secretary Carole A Maclure | Treasurer Patricia A Terrill | Immediate Past President Mary C Antoun | Chief Executive Officer
Editor
Melissa Lutz | melissa.lutz@mdrealtor.org
Advisory Committee Yolanda R Muckle | Chair Thomas P Levin | Vice Chair
Advertising
Arlene Braithwaite | 410.772.0820
Publication Design
HBP, Inc., 952 Frederick Street, Hagerstown, MD 21741 800.638.3508 | www.hbp.com
Carole A Maclure
Treasurer RE/MAX Advantage Realty 17304 Evangeline Lane Olney, MD 20832-2928 240.295.6000 maclure7@aol.com
Janice R Kirkner Secretary Long & Foster Real Estate, Inc. 1208 Nottingham Drive Westminister, MD 21157-8334 410.795.9600 Janice.kirkner@longandfoster.com
Patricia A Terrill
Mary C Antoun
Immediate Past President Prudential PenFed Realty 7501 Coastal Highway Ocean City, MD 21842-2937 410.524.7000 pat.terrill@gmail.com
Chief Executive Officer Maryland Association of REALTORS® 200 Harry S Truman Parkway Suite 200 Annapolis, MD 21401-7348 800.638.6425 mary.antoun@mdrealtor.org
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MARYLAND REALTOR® JUNE | JULY 2013
Mission Statement The Maryland Association of REALTORS® exists to support all segments of its membership and their specialties. The Maryland Association of REALTORS®, through collective efforts with local boards/associations and the National Association of REALTORS®: ■ Develops and delivers programs, services and related products that maintain and elevate the high standards of the real estate business and the professional conduct of its practitioners; ■ Assists members in ethically and professionally serving the public; ■ Promotes and preserves the right to own, transfer and use real property; and ■ Protects the right of members to conduct business within a framework of fair and reasonable laws and government regulations. In principle and in practice, the Maryland Association of REALTORS® values and seeks diversity and inclusive participation within the field of real estate and recognizes each member as a unique individual. Maryland REALTOR® (USPS 0016-017) is published bimonthly by the Maryland Association of REALTORS®, Suite 200, 200 Harry S Truman Parkway, Annapolis, MD 21401-7348. Periodical postage paid at Annapolis and additional mailing offices. Postmaster send address changes to: Maryland REALTOR®, Suite 200, 200 Harry S Truman Parkway, Annapolis, MD 21401-7348. Member subscriptions of $3.81 are paid with annual dues. This publication is designed to provide accurate and authoritative information regarding the subject matter covered. It is offered with the understanding that the publisher is not engaged in rendering professional advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Articles that appear in Maryland REALTOR® are an informational service to members. Their contents are the opinions of the authors alone and do not necessarily represent those of the Maryland Association of REALTORS®. Permission to reprint articles appearing in Maryland REALTOR® magazine must be requested in writing. Also include purpose for request. While this magazine makes a reasonable effort to establish the integrity of its advertisers, it does not endorse advertised products or services unless specifically stated. ©2010 Maryland Association of REALTORS®, Inc.
www.mdrealtor.org
Fickle Seas A
control; lead tests for homesellers of pre-1978 properties; and disclosure of felonies and deaths on property. MAR succeeded in stopping these bills.
Instead, this year presented some key challenges for Maryland real estate, including proposals for statewide rent
We also had success supporting some key real estate bills. The Maryland General Assembly passed legislation giving real estate agents a clearer exception from the law requiring credit services licenses. The Legislature also passed bills giving homeowners more time to apply for the Homestead
fter last year’s difficult legislative session, when the Maryland Association of REALTORS® (MAR) successfully fought back challenges to the mortgage interest deduction and exclusive right to sell contracts in Maryland, we anticipated a 2013 legislative session of fair winds and following seas.
www.mdrealtor.org
Tax Credit, and easing homeowner’s ability to refinance property subject to a second mortgage. MAR also supported legislation making it harder to divert transportation dollars to other needs. Finally, MAR supported two bills— pit bull legislation and tenant security deposit interest rates—that failed to pass due to important differences between the House and Senate versions.
MARYLAND REALTOR® JUNE | JULY 2013
5
The following summary highlights some of key real estate issues discussed in the 2013 legislative session. AF F ORDABLE HOUSI NG AND TAX ES HB 71—Homeowner’s Insurance— Underwriting Based on Geographic Area
HB 235—Property Tax—Valuation of Residential Real Property— Database
STATUS: NOT PASSED
STATUS: PASSED—October 1, 2013
Requires insurance carriers who underwrite homeowner’s policies and exclude risks based on geographic areas to obtain the approval of the Insurance Commissioner for those exclusions and to have a written underwriting standard describing the exclusion.
Requires the State Department of Assessments and Taxation (SDAT) to maintain an accessible database on its website providing information related to a property’s square footage, bathrooms, and the date of the initial assessment of new improvements.
HB 88/SB 199—Real Property— Refinance Mortgage—Priority over Junior Liens
HB 263/SB 144—Property Tax Credit—Historically and Architecturally Valuable Property
STATUS: PASSED—Effective October 1, 2013
STATUS: PASSED—Effective June 1, 2013, applicable to tax years after June 30, 2013
Authorizes homeowners to refinance a first mortgage without obtaining permission from the lender that funded a home equity loan or second mortgage. The bill applies to current mortgages as long as the refinancing occurs after the effective date.
Authorizes local governments to increase from 10 to 25 percent the tax credit for the restoration or preservation of a historic or architecturally valuable property.
*HB 128/SB 158—Homestead Tax Credit—Eligibility Verification and Application
*HB 378—Maryland Agricultural Land Preservation Fund—Easement Restriction Reimbursement
STATUS: PASSED—Effective April 9, 2013
STATUS: PASSED—Effective July 1, 2013
Extends by one year the time frame for property owners to apply for the Homestead Tax Credit. Properties that have not been transferred after December 31, 2007 can now apply for the Homestead Tax Credit by December 30, 2013 (Dec. 31st is a furlough day for state employees) rather than December 31, 2012.
Authorizes the Maryland Agricultural Land Preservation Fund (MALPF) Board of Trustees and the Comptroller to reimburse certain property owners for lots those owners subject to MALPF easement restrictions. Applies in situations when a lot owner pays to release a lot from easement restrictions but then places the lot back under the easement.
HB 621/SB 627—Maryland Energy Administration—Regulated Sustainable Energy Contract Program STATUS: PASSED—July 1, 2013 Authorizes contractors to enter into an agreement with consumers to pay for energy improvements. The contracts are subject to specific payment requirements and may, in some instances, be recorded in the land records. Requires the approval of the mortgage holder to agree to the terms of the sustainable energy contract.
HB 695—Homeowner’s Insurance—Anti-Concurrent Causation Clause—Prohibited STATUS: PASSED—Effective for all policies issued, delivered or renewed on or after October 1, 2013 Requires an insurer to provide a clear notice to a consumer regarding an anti-concurrent coverage (ACC) clause in policies. An ACC clause provides that if loss is caused by both covered and non-covered events, the loss claim will not be paid.
HB 965—Homestead Tax Credit— Eligibility—Definition of Legal Interest STATUS: NOT PASSED Allowed a settler, grantor or beneficiary of a property held in trust who is residing in the property at no cost to claim the homestead tax credit.
HB 1208—Bay Restoration Fee— Exemption—On-Site Sewage Disposal System Using Best Available Technology STATUS: NOT PASSED Exempted property owners from the Bay Restoration fee if the owners had to install Best Available Technology (BAT) septic systems.
* Indicates a bill that has been signed by the Governor. All other bills listed have been passed by the Maryland General Assembly and await the Governor’s signature to take effect. “Defeated” indicates bills opposed by MAR. “Not Passed” indicates bills that either MAR did not oppose or bills that MAR opposed but which did not receive a vote.
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MARYLAND REALTOR® JUNE | JULY 2013
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R E AL ESTATE BROK ER AGE AND CO N TR AC TS HB 40—Residential Property Sales—Disclosure of Utility Consumption STATUS: NOT PASSED Specified that sellers display or make available to buyers information regarding monthly costs for electric, gas, and home heating oil.
HB 291/SB 383—Real Property— Maryland Mortgage Relief Services Act STATUS: PASSED—Effective July 1, 2013 Provides state government with authority to enforce violations of federal regulations controlling the activities of mortgage assistance relief service providers. Also gives Maryland consumers a private right of action. The current federal regulations require clear disclosures to consumers and specific rules on how and when payments may be collected.
HB 340/SB 189—Residential Real Property Sales—Property Tax Disclaimer STATUS: NOT PASSED Required a notice in the Seller Disclosure and Disclaimer form stating that the buyer’s property tax bill may be significantly different than the seller’s current bill and that the buyer should contact local government to estimate the future tax bill.
HB 785/SB 375—Commercial Law—Maryland Credit Services Businesses Act—Scope
HB 917—Real Property—Property Used for Methamphetamine Production—Disclosures and Quarantine STATUS: NOT PASSED Established a process for remediating properties that had been contaminated by a methamphetamine laboratory. The bill would have established a quarantine period for the property as well a disclosure requirement before the property could be resold.
HB 1008—Real Property— Foreclosure—Mortgage Foreclosure Property Values Protection Act of 2013
HB 1308/SB 642—Residential Property—Prohibition on Nonjudicial Evictions STATUS: PASSED—Effective June 1, 2013 Prohibits nonjudicial evictions in foreclosures and rentals (including mobile home parks) except when the property is abandoned.
HB 1354—Real Property— Disclosure Requirements—Death by Other than Natural Causes STATUS: DEFEATED
STATUS: NOT PASSED
Required home sellers to inform buyers about whether a death or felony occurred on a property, effectively repealing most of Maryland’s stigmatized property law.
Required a purchaser of foreclosure property to record the deed within 60 days of the ratification of sale or require certain information regarding the purchaser of the property to be recorded in the land records.
HB 1413/SB 969—Public Safety— Fire Protection and Prevention— Residential Smoke Alarms
HB 1048—Real Property—Sale of Property—Lead-Contaminated Dust Test Required STATUS: DEFEATED Required a seller of pre-1978 property to conduct a lead dust test of the property at least 7 days prior to settlement. The bill would have given the purchaser the right to waive the dust test.
STATUS: PASSED—Effective Date October 1, 2013 Clarifies that licensed real estate associate brokers and salespersons are not required to obtain a credit services license in order to provide real estate brokerage services. Only real estate brokers had been exempted from the original law thus potentially exposing agents to regulation when assisting a home owner who is at risk of foreclosure.
STATUS: PASSED—Effective July 1, 2013 Requires homeowners to disclose whether the smoke detectors are over ten years old and whether they use a ten-year sealed battery as required under Maryland law by 2018. The notice will be added to the current Seller Property Condition Disclosure Form. The legislation also requires homeowners to update smoke detectors to newer sealed battery systems if the smoke detectors are battery operated and are over 10 years old or malfunction when tested. Smoke detectors that are hard-wired are also required to be updated every 10 years or when those systems malfunction. Finally, the legislation requires that at least one smoke detector be located on every floor of a residence by 2018.
COM M ON OWNERSHI P COMMUN I TI ES HB 286/SB 161—Real Property— Maryland Mortgage Assistance Relief Services Act STATUS: PASSED—Effective October 1, 2013 Limits certain foreclosure rights of Homeowner Associations (HOAs) and the Council of Unit Owners for Condominiums (Condos). An HOA or Condo may not foreclose on a property if the lien is comprised only of fines and/or attorney
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MARYLAND REALTOR® JUNE | JULY 2013
fees to collect those fines. HOAs and Condos may only foreclose on a lien comprised of delinquent assessments and/or attorney fees to collect those assessments.
HB 576/SB 794—Real Property— Regulation of Common Ownership Community Managers STATUS: NOT PASSED Required licensing of common ownership community managers. Common ownership communities are condominiums and homeowner associations. The bill also would have provided some exemptions from licensing for real estate licensees and other categories. www.mdrealtor.org
L A ND -U S E, PROPERT Y RI GHTS, AND THE EN V I RO N M EN T HB 706—Natural Resources Forest Preservation Act of 2013 STATUS: PASSED—Effective October 1, 2013 Establishes a 40% goal for forest canopy in Maryland but does not mandate a compliance timetable. The bill also directs the Department of Natural Resources to create a forest resource inventory, and to provide technical assistance and guidance to local governments. The bill provides some limited exemptions from the act for activities related to stream restorations and projects in high growth areas with significant impervious surfaces.
HB 769/SB 750—Public Safety— Maryland Building Performance Standards—Local Wind Design and Wind-Born Debris Standards STATUS: PASSED—Effective October 1, 2013 Prohibits local governments from enacting changes to the Maryland Building Performance Standards (MBPS) that weaken wind design and wind-borne debris standards.
HB 796/SB 427—Income Tax Credit—Agricultural Land— Diminution in Value of Real Property STATUS: NOT PASSED Established a tax credit to compensate property owners for the reduced value of property due to the restrictions of the Sustainable Growth Act and Nutrient Management Plans.
HB 800/SB 524—Wetlands and Riparian Rights—Licenses and Permits for Nonwater-Dependent Projects on State or Private Wetlands STATUS: PASSED—Effective July 1, 2013 Establishes a permit and fee for nonwaterdependent projects located on piers over private and state wetlands. The permit allows limited commercial activity on piers in conjunction with an established business. The fee is based on a percentage of the business’s current property tax bill.
SB 28—Real Property—Blighted Property—Nuisance Abatement STATUS: DEFEATED Required owners of blighted property to fix up the properties or face a fine equal to a tripling of the annual property taxes. An owner could avoid the fine by selling the property.
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www.mdrealtor.org
MARYLAND REALTOR® JUNE | JULY 2013
9
L AND -U SE, P ROPERT Y RI GHTS , AN D THE EN V I RO N M EN T cont i nu e d SB 500/SB 973—Environment— On-Site Sewage Disposal Systems—Nitrogen Removal Technology—Prohibition
SB 970—Private Property Rights— Regulatory Infringement— Compensation
STATUS: NOT PASSED
Provided property owners with a cause of action if regulations promulgated by certain state agencies diminished a property’s value. The state agencies would be liable only if those agencies could not demonstrate that their action was necessary to comply with federal law.
Clarified that the Maryland Department of Environment (MDE) cannot require new and existing homes outside of the critical areas to use Best Available Technology (BAT) septic systems.
STATUS: NOT PASSED
PRO PERT Y MANAGEMENT HB 45/SB 337—Real Property— Residential Leases—Interest on Security Deposits
HB 754—Environment— Reduction of Lead Risk in Housing—Qualified Offer
manufacturers, it did not protect landlords from counter suits by the manufacturers.
STATUS: NOT PASSED
STATUS: NOT PASSED
Required landlords to return security deposits with an interest rate of 1.5% or a rate equal to the U.S. Treasury Daily Yield Curve Rate, whichever is higher.
Created a qualified offer under Maryland law designed to meet the concerns expressed by the Maryland Court of Appeals in its case Jackson v. Dackman. Damages were capped at $100,000, a significantly higher amount than the $17,000 cap under the old law.
HB 1067—Environment— Reduction of Lead Risk in Housing—Blood Lead Level
HB 78/SB 160—Civil Actions— Personal Injury or Death Caused by Dog—Rebuttable Presumption STATUS: NOT PASSED Reversed the Court of Appeals decision on pit bulls so that landlords do not have “strict liability” for dog bites caused by their tenants. The bill also created a rebuttable presumption for dog owners rather than the “strict liability” imposed by the case.
HB 923—Certificate of a Qualified Expert—Lead Paint Poisoning Claims STATUS: NOT PASSED Required courts to dismiss a lead paint poisoning claim if the plaintiff failed to file a certificate of a qualified expert.
HB 315—Residential Leases— Rent Stabilization and Just Cause Evictions
HB 924—Environment— Reduction of Lead Risk in Housing—Applicability and Registration Requirements
STATUS: NOT PASSED
STATUS: NOT PASSED
Established state-wide rent control limiting how much rents can be increased for current tenants. The bill also would have provided a more difficult standard to meet when evicting tenants.
Clarified that property owners with units built between 1950 -1978 must pay the $30 registration fee under the Reduction of Lead Risk in Housing Act but are not required to participate in the program. Legislation passed last year requires these properties to pay the fee and meet program requirements.
HB 603/SB 487—Human Relations— Housing Discrimination—Source of Income STATUS: DEFEATED Established “source of income” as a protected class under Maryland law.
STATUS: DEFEATED Lowered the trigger level for Maryland’s lead paint law from 10 micrograms per deciliter to only 5.
HB 1090/SB 849—Public Utilities—Consumer Relations— Tenant Payment of Landlord Utility Bills STATUS: PASSED—Effective January 1, 2014 Gives tenants, except those receiving service from an electric cooperative, the ability to create a service account in their own name when faced with termination of service because the landlord failed to pay the bill. The bill applies only to tenants receiving service through a single meter to a single dwelling unit. If the tenant establishes an account, the tenant may not be billed for utility service by the landlord.
HB 1222—Real Property— Landlord Defenses in Nuisance Actions STATUS: NOT PASSED
HB 947—Environment— Lead-Based Paint Damages— Manufacturers of Lead Pigment STATUS: DEFEATED
Provided a legal defense for landlords faced with a nuisance action if the tenant was the sole cause of the nuisance action and the landlord had been making efforts to remove the tenant.
Created a “market-share” liability standard for lead paint pigment manufacturers. While this legislation theoretically gave landlords the right to participate in suits against lead paint
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MARYLAND REALTOR® JUNE | JULY 2013
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EOE
PROPE R T Y MANAGEMENT co ntinu e d HB 1279/SB 902—Statewide Building Codes—Maryland Accessibility Code
HB 1308/SB 642—Residential Property—Prohibition on Nonjudicial Evictions
HB 1413/SB 969—Public Safety— Fire Protection and Prevention— Residential Smoke Alarms
STATUS: PASSED—Effective October 1, 2013
STATUS: PASSED—Effective June 1, 2013
STATUS: PASSED—Effective July 1, 2013
Gives tenants a private right of action against a building owner if the building does not meet accessibility requirements. The bill does not change a tenant’s current right to sue under the Americans with Disabilities Act or Section 504 of the Federal Rehabilitation Act of 1973. Before initiating a law suit, a tenant must give a building owner 30 days to propose a compliance plan.
Prohibits nonjudicial evictions in foreclosures and rentals (including mobile home parks), except when the property is abandoned.
Requires landlords of one and two-dwelling units to upgrade battery smoke detectors to new, ten-year battery, sealed units at change of occupancy or when those systems are ten years old or malfunction. For buildings with more than two units, the legislation states that it is the responsibility of the occupant to test the smoke alarms and notify the landlord, and that it is the responsibility of the landlord to replace or repair the smoke alarm.
COM M E RCI AL HB 161—County Property Taxes— Classes of Property—Special Rates and Limits STATUS: NOT PASSED Authorized county governments and Baltimore City to impose different property tax rates for any class of property. The rate for commercial property would have been limited to 1.25 percent of the residential rate.
HB 372/SB 202—Recordation and Transfer Taxes—Transfer of Property Between Related Entities—Exemption
HB 881—Corporations and Associations—Limited Liability Companies—Company Representative STATUS: DEFEATED Required Limited Liability Corporations (LLCs) to pay a fee and file paperwork designating a company representative. The company representative would have been in addition to the resident agent that LLCs already designate, but, unlike the resident agent, the company representative would have had to be an actual person.
HB 1209/SB 436—Recordation Taxes—Exemptions STATUS: PASSED—Effective July 1, 2013 Revises legislation passed last year that imposed recordation taxes on Indemnity Deeds of Trust (IDOTs). Specifically, the bill increases the trigger for the recordation tax from $1 million to $3 million; clarifies that a series of loans falling below the trigger amounts can be aggregated to determine the trigger level; and clarifies that an IDOT refinance of the original mortgage amount is not taxable.
STATUS: PASSED—Effective for instruments recorded after July 1, 2013 Exempts from transfer and recordation tax a transfer of real property between related businesses and corporations such as parent companies and wholly-owned subsidiaries.
M IS CE L L ANEOUS HB 1156/SB 819, HB 1182— Maryland Contributory Negligence Act STATUS: NOT PASSED Established by statute that the defense of contributory negligence is valid under Maryland law. The Maryland Court of Appeals is currently considering a case that could overturn the contributory negligence rule.
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MARYLAND REALTOR® JUNE | JULY 2013
SB 829—Transportation Trust Fund—Financing—Use of Funds STATUS: PASSED—Effective when approved by Maryland Voters in the 2014 Election Proposes an amendment to the Maryland Constitution prohibiting the use of the transportation trust fund for other purposes. The amendment requires the Governor to declare a fiscal emergency in order to divert money from the Transportation Trust Fund, and requires the diversion to be approved by a three-fifths vote of the House and Senate.
The 2013 Maryland Legislature is adjourned for the year, and MAR will now turn its focus to the federal issues before Congress, including: changes to the mortgage interest deduction; overly strict lending policies; capital gains tax rates and other issues affecting your clients and your business. Stay informed about these issues by regularly visiting mdrealtor.org. Like the RPAC saying states “If real estate is your profession, politics is your business.”
www.mdrealtor.org
2012 E D I T I O N
Leaders
of the PAC
Thank You to all our 2012 RPAC Investors. Your support of RPAC demonstrates your insight about the importance of our efforts to support candidates who support our industry and our profession. Special thanks to the continued, generous support of RPAC Golden R Investors for their extraordinary leadership and dedication. President’s Circle
Golden R Investors
Those REALTORS® who are major investors AND pledge $2,000 directcandidate contributions. ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Mary Antoun Bill Armstrong Carlton Boujai Russ Boyce Rick Brown Tommy Carruthers Bonnie Casper Jon Coile Nick D’Ambrosia Gloria Farrar Iona Harrison John Harrison Harold Huggins Al Ingraham Ilene Kessler Janice Kirkner Buzz Mackintosh Carole Maclure Shelly Murray JoAnne Poole Dale Ross Cathy Werner
www.mdrealtor.org
■ Maryland Association of REALTORS® ■ JoAnne Poole ■ Prince George’s County Association of
Thank You Golden and Sustaining Golden R Investors!
■ ■ ■ ■
■ Russ Boyce ■ Nick D’Ambrosia ■ Greater Capital Area Association
of REALTORS®
■ Janice Kirkner ■ Dale Ross u s ta i n i n
S
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
C r y s ta l R I n v e s t o r s Thank You Crystal R and Sustaining Crystal R Investors!
Golden
Mary Antoun Bill g Armstrong R Tommy Carruthers Bonnie Casper Adam Cockey Jon Coile Greater Baltimore Board of REALTORS® Iona Harrison John J. Harrison Al Ingraham Ilene Kessler Carole Maclure
REALTORS® Joan Ryder Jay Webster Cathy Werner Wayne Wyvill
■ Carlton Boujai ■ Jill Pogach Michaels ■ Michael Moran u s ta i n i n
S
C r y s ta l
■ ■ ■
Tom Earnest Gloria FarrarR g Harford County Association of REALTORS® ■ Howard County Association of REALTORS® ■ Billy Yerman
MARYLAND REALTOR® JUNE | JULY 2013
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Sterling R Investors The RPAC Trustees would like to recognize first-time Sterling R Investors, for their generous contribution of $1000 to RPAC in 2012. Thank you for your support! ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Carolyn Blanchard-Cook Brandon Brittingham Dwayne Carte Bill Castelli Galen Clagett Alicyn DelZoppo Sheila Dodson Steve Ferguson Marc Fleisher Ivy Gifford John A. Harrison Ellen Katz Scott Lederer Tom Levin Paula Martino DeAnna Miller Linda Moran Yolanda Muckle Pen-Mar Regional Association of REALTORS® Tim Reinhart Brenda Small Mo Snowden James Stephens David Therrien Jennifer Utz David Vane Pam Wadler Pat Weed Robert Wiley Mark Wilson
Multi-Year Sterling R Investors The RPAC Trustees would further like to recognize our MULTI-YEAR STERLING R INVESTORS for 2012, and thank them for their support! ■ Jean Andrews—Two-Time Sterling R ■ Cheryl Bare—Two-Time Sterling R ■ James Blaney—Two-Time Sterling R ■ James M Coley Jr.—TwoTime Sterling R ■ Craig Strobel (Exit Preferred Realty LLC)—Two-Time Sterling R ■ Jim Hyatt—Two-Time Sterling R ■ Leigh Lawson-Everstine— Two-Time Sterling R ■ Mary Ann O’Malley— Two-Time Sterling R
14
■ Rebecca Perlow—Two-Time Sterling R ■ Scott Reiter—Two-Time Sterling R ■ Kevin Turner—Two-Time Sterling R ■ Gwen Wynn—Two-Time Sterling R ■ Koki Adasi—Three-Time Sterling R ■ John Coller—Three-Time Sterling R ■ Roger Fairbourn—ThreeTime Sterling R ■ Million Dollar Club of Howard County—ThreeTime Sterling R ■ Bob Kimball—Three-Time Sterling R ■ Rick M. Rall Jr.—Three-Time Sterling R ■ Pat Terrill—Three-Time Sterling R ■ Meredith Weisel—ThreeTime Sterling R ■ Timothy Blanchfield—FourTime Sterling R ■ Desiree Callender—FourTime Sterling R ■ Timothy Knobloch—FourTime Sterling R ■ Susan Myszkowski—FourTime Sterling R ■ Marilyn Rhodovi—Four-Time Sterling R ■ P. Joy Siegel—Four-Time Sterling R ■ Connie M. Stommel—FourTime Sterling R ■ Richard Brown—Five-Time Sterling R ■ Frederick County
Association of REALTORS®—Five-Time
Sterling R ■ Tom Hough—Five-Time Sterling R ■ Randall Rothstein—FiveTime Sterling R ■ Tim Wood—Five-Time Sterling R ■ Bud Church—Six-Time Sterling R ■ Theo Harris—Six-Time Sterling R ■ Shirley Matlock—Six-Time Sterling R ■ Steve Meszaros—Six-Time Sterling R ■ Mike Cerrito—Seven-Time Sterling R ■ Joanne Darling—Seven-Time Sterling R ■ Bud Humbert—Seven-Time Sterling R
MARYLAND REALTOR® JUNE | JULY 2013
■ Ken Montville—Seven-Time Sterling R ■ Carroll County Association of REALTORS®—Eight-Time Sterling R ■ Creig Northrop—Eight-Time Sterling R ■ Susan Pruden—Eight-Time Sterling R ■ Ashley Richardson—EightTime Sterling R ■ Alease Bowles—Nine-Time Sterling R ■ Melvina Brown—Nine-Time Sterling R ■ Alana Lasover—Nine-Time Sterling R ■ John Lesniewski—Nine-Time Sterling R ■ Ann Moxley—Nine-Time Sterling R ■ Shelly Murray—Nine-Time Sterling R ■ Tom Quattlebaum—NineTime Sterling R ■ Pat Ulrich—Nine-Time Sterling R ■ Jack Bannister—Ten-Time Sterling R ■ Wes Foster—Ten-Time Sterling R ■ Buzz Mackintosh—Ten-Time Sterling R ■ Cindy Ariosa—Eleven-Time Sterling R ■ Boyd Campbell—ElevenTime Sterling R ■ Alex Karavasilis—ElevenTime Sterling R ■ Jan Hayden—Twelve-Time Sterling R ■ Mary Lou Kaestner— Thirteen-Time Sterling R ■ Judy Morris—Thirteen-Time Sterling R ■ Marc Witman—FourteenTime Sterling R ■ Real Estate Million Dollar Association of Baltimore— Seventeen-Time Sterling R ■ Georgiana Tyler—SeventeenTime Sterling R ■ Harold Huggins—TwentyTime Sterling R ■ Michael Yerman—TwentyTwo Time Sterling R ■ Women’s Council of Baltimore—Twenty-Two Time Sterling R ■ Nancy Hubble—TwentyThree Time Sterling R ■ Women’s Council of Prince George’s County—TwentyFive Time Sterling R
C apital C lub ($200–$999) ■ Phyllis Adam ■ Diana Armacost (Lakeside ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Title Co.) Wendy I Banner Kathleen F Beadell Karen W Beall John P Bragale Jan Brito Pete Burnstein R. Bruce Campbell J. Joseph Casey Kim Caspari Kathy Christensen Galen R Clagett Colleen S. Cogan Lori M Connor Anne Cooke Wanda DeBord (Title Max LLC) Kay Deitz David E DeSantis Joe Detrick (Classic Settlements) Pete Dimitriades Kathy Dixon Sharron Dorsey Tom Drechsler Connie Dube Jane Fairweather Paul J Fenton Richard B Firth Jeffrey S Ganz Joan E Gardiner Carl S. Gewirz Bob Golden Ashton G Gonella Mynor R Herrera Karol A Hess Sharon K Hiner Dan Hoff Sam Hoff Steven Huffman Chris Jett (Elite Marketing & Sales, LLC) Marla Johnson Sherry E Kalish Diana C Keeling Elley S Kott Billie D Landbeck Denise M Lewis Don Maclure Katie Maclure Dennis P Maguire Peg M Mancuso Renee Mankoff Maryland Real Estate Educators Michael McGreevy Sharon A McKenna Dennis B Melby Vittorio Muzzatti Vernon J Nily Jr Brian Nowakowski (Academy Mortgage Corp)
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C apital C lub ($200–$999) ■ Ruth M Papuchis ■ Helene Parks Richardson ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
(Maryland Title Service Corp) Michael W Patrick Veera Phillips Amy Ritsko-Warren Noni Rondeau Susan J Sanford Louise Schultz Jason S. Sherman Prabhjit Singh Anne C Smoley John W Steffey Sr. David L Therrien Jeanne L Turnock
$99 C l u b ($99–$199) ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Gary S Addington Akinbode Akinola Matthew D Alegi Jacqueline A Alexander Lyn Alexander John G Allen Nancy J Aloi Allan P Amernick Leon W Andris Kannan Annamalai Jeff Annis Frederick W Archer Bob Arnold John M Ashley III Jenny Koontz (Associates Title Services, Inc.) Steve L Atkocius Sammy A Barbieri Carol Barranger Robert J. Bassett Hassan Baukman Benjamin B Bell Jr. Jon Bell Deborah Benkert Coard A Benson Mike W Benton Molly A Beringson Janet L Bernard Donald L Biedenback Daniel M Billig John N Blake Patrick F Bogan Kim Bongiorno Nancy G Boryk Carole L Bowen William G Bowen Fred C Brand Carrie B Brandt Doug A Brasse Lynette L Bridges-Catha Don N Briggs Carey A Brill E Jean Brockington Jonas Brodie Maria A Brown Val P Brown Bette Buffington
www.mdrealtor.org
continued
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Cindy N Buniski Cam A Bunting Robert M Burke Sam E Burke Chip Burnett W Corey Burr Bill E Burris Dana M Byrd Sonatta S Camara Delaine Campbell Robin C Caparosa J Roger Carp Dontae S Carroll Michael J Casey Sr Patrick J Casey Robert Caspar (Steamboat Associates, LLC) Gloria J Castle Peggy Castle Robert R Castro Kathy Cheatham Lin Chen Herb E Chisholm Garnett Y Clark Jr. Jann Clark Kathleen M Clark Thelma K Clark Hick N Clark Walter Clews (Amerispec Home Inspection Service) Pat A Coan Tom P Coard Bob Connelly William J Connor Raymond S Contee Jr Carol E Cook Peter S Copenhaver Lou Ramsay Cotta Neda R Cox Carol Sue Crimmins Jennifer L Cropper-Rines Mary Judith J Curren Richard M Curtis Sharon Curtiss Ann L D’Ambrosia Kathleen M Dartez Anita T Davis Chris Davis Kathy A Davis Mark J Davis Michael D Davis Robert L Davis Jr Yvonne Deardorff Ronald P Deem Don M DeHanas Joseph A DeLuca Stanley Dill Anngellic W Dinkins BJ Discenza Diana T Divver Karen L Donaldson Lee Downey Patricia A Dowtin Mike Dunn Maureen A Earp Wood
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Page Eisinger Margie G Eldridge Mary Ann Elliott Norma S Epstein Gwen E Eskridge Laurence Eul Jr. David Fairweather James Fegan Sandy Fehl Marianne S Ferguson Billy J Fitzgerald Charmaine Flanagan Brian L Flook Howard L Ford Jr John A Ford Paul W Foster III Sandy M Fouche Elizabeth Y Foulds Bill Francis (RE/MAX Solutions) Carl T Franzen Ben Frederick III Candice L Friday Mark C Fritschle Kathy L Gaines-Still Lynn Gardner (RGS Title LLC) Luciano Gargano Marianne V Garrison Cara L Garside Michael C Gary Sr. Karen W Gaylord Bob Ge Paul A Gillespie Jean Gilman III Dorie A Glass Joseph F Gobbett Jr Jenn E Goff LT Goodall Judi A Gordon Maynard B Gottlieb David L Graham Nolen J Graves Mike Graziano Rebecca F Greco Bruce L Green Liz A Green Arthur F Greene Jan J Greene Barb Gregory Mike E Grimes Marie A Grismer Audrie M Gue Alan Halle Pete A Hamelman Roscoe Handy Richard Harbin Darlene Harenberg Ronald E Harman Vicki A Harmon Tom Harner Marilyn V Harrington Carolyn C Harris Shari L Harris Craig P Harshman Helen J Hartman
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Joyce H Hartnett Chuck P Hawley Diane W Hayes Betty M Hays Irene E Heller Sue Hemmerly Elsie M Herbst Barry Hess Samuel L Hicks Joseph B Higdon Quantane L Higginbotham Tommy L Higgins Wanda J Higgs Debbie E Hileman Cheryl E Hill Joe B Hill Jr. Suzanne Hinder Suzanne M Hitt Shari Hodges Matthew D Hogans Vaughn R Hogans Mark S Holloway Lee Holt Bill J Homoky Lucia P Hopkins Clarence E Horst Irma D Houck Sara L Hourihan-Taylor Edward B Howlin Jr. Linda C Hughes Jerry Humberson Joanie M Hynes Dick Ishler Jr Theresa M Jackson Sanford B Jaffe Subbarayudu Jakkampudi Bob L Jebsen Dee M Jefferson Chris S Jett Michael C Johnson Robert E Johnston III Mary M Jones R Bruce Jones Tia Jones-Johnson Rose Marie Jung Russell Katz Edwin L Kelly Heidi S Kenny Doris A Kessebeh Goher N Khan Karen L Kilheffer Chang K Kim Ed D King Paula Kipperman Peter J Klebenow Diana Klein Jeni Kneessi Ernest Knight (Next Century Realty, Inc) Leah D Knoerlein Christy L Kopp Daniel Korn Paul C Lancaster Robert L Langley Sr. Joan M Lapera
MARYLAND REALTOR® JUNE | JULY 2013
15
$99 C l u b ($99–$199) ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
continued
Joseph Laumann Michael Leaf William D Leager Mary A Lee Thomas R Leverance Joy B Liberti Arlene O Linn Sandy M Lofgren-Sargent Scott Lokey Patricia H Long Robin S Lower Kitty Lusby Michael J Lyons Stephen MacDonald T. Ross Mackesey Kathy Malone Kevin M Maloney Ali R. Mansouri Robyn D Marbray Diane M Marsden Gilbert D Marsiglia Sr. Bill E Martin Jr Cindy A Massari Grace P Masten Christine P Master James E Matthews Sara H Matthews Terrie V Matthews Barbara C Mattingly Dale E Mattison Lynn Mauk Aaron M Max John May George C Mbagwu Pat McClary Doug W McClive III David D McCollough Matthew C McDaniel Vernee J McFarlin Michael McKenna Sheri McLaughlin Chris M McNelis Ginny A Meeks Susan B Megargee Francis A Mehlfelt Brigitte Messali Debi A Meushaw Carole Milan Fredi R Miller Scott Miller George E Mitchell Donna Moffett
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Eric J Moholt Beverly A Moody Allison D Mooney Michael R Moore Jerry G Moran Peter D Morgan Cindy G Moses Timothy D Murnane Dennis C Murphy Nathan Murray Karen F Myers Stephanie Myers Gary G Nelson Hedy Nelson Joyce A Nesbitt Andre E Nicholas Kimberly Ann Nicholson Paul C Nwachukwu Simon N Nwaigwe Mike P O’Brien William M O’Connell John Michael OConnell Tom E Oelschlaeger Wendy T Oliver Christina B OMeara Godfrey U Onuzulike Richard OShea Joan Ostenso David D Palmer Jr Walter D Palmer Bonnita A Parks Ian C Parrish Michael J Parrish Barbara Passwater Art Payne Kathi L Payne Terry C Phillips John F Pilkins Jr. Craig B Pittinger Diane Plott Carol S Plunkert Doug Poole Robert G Ramoy Jannelle R Rannie David B Ratti Michael S Ray Tammi Reeder Margaret M Regnier Kelly Renfro Jan Reynolds Willie M Rhone Dean Richardson
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Jose A Rivas Gayle Roberts James C Robinson Bea P Rodgers Charles Rodriguez Harry R Roop Nancy M. Rosenberg Tammy D Rosendale William Rozek William M Runnebaum Jr. Jeanne Russo Alexander Ruygrok Sandy L Sadler Elisabeth Salchow Tod Salisbury Arnold H Sampson Kaushladevi Samtani Monzella Saunders-Owings George R Savani Pat M Savani Carol A Schantz Mel Schneider Michelle Schonig Mary B Schultz Deborah L SeBour Dick E Sells Paulette E Shaduk Bob Simon Nancy R Simpers Alfred L Singer Jim Skirven Hugh M Smith Kenneth E Smith Larry E Smith Sandy J Smith Virginia S. Smith RoseAnn C Spalt Betsy Spiker Holcomb Ed G Stanfield Michael Stanford Glenn B Staples Stu J Stern Paul L Stokes Mary Lynn R Stone Joan M Strang David H Stromberg Kathy L Suite Ron L Sullivan Tim B Sullivan Carol Sutfin Max Sweet Judy H Szynborski
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
Doannie A Tambascio Walt D Taraila John W Tauber Robb M Taylor Ronald G Taylor Maria A Terry Tim K Thomas Judy I Thompson Sebastian Torres Karen J Towne Marlene S Trimble Donna A Turing Jim Turner Phyllis M Tutko Judy C Tyree Marty C Van Kirk Luba Vidgop Barg John Von Paris Greg Vurganov Ted W Walls Jennifer Ward Otis Warren Jr. Devin J Warwick Barry P Waterman Mareen D Waterman Barbara Watkins (Hidden Cove, Inc.) Victor D Watson Donna Weaver Norman P Wehner Mike C Weisner Babs L Whaley Barbara F Whitaker Ed A White Darron S Whitehead Patsy J Whiteley Hilda F Whittington Bill E Wieland Nancy A Wiest Kevin A. Wiles Deborah H Wilkens Farone Williams Jennifer Williams Leonard E Wilson Jr Linda F Wilson Sandra K Wing Bruce R Witt Craig Wolf Bill R Wootan Jeff F Wright Bruce Wrightson Sung Y Yoon
Congratulations to ALL REALTOR® Local Associations/Boards that exceeded their 2012 RPAC Goals! ■ Anne Arundel County Association ■ ■ ■ ■ ■
16
of REALTORS® Bay Area Association of REALTORS® Carroll County Association of REALTORS® Cecil County Board of REALTORS® Coastal Association of REALTORS® Frederick County Association of REALTORS®
MARYLAND REALTOR® JUNE | JULY 2013
■ Garrett County Board of REALTORS® ■ Greater Baltimore Board of REALTORS® ■ Greater Capital Area Association
of REALTORS®
■ Greater Washington Commercial
Association of REALTORS® ■ Harford County Association of REALTORS® ■ Historic Highlands Association of REALTORS®
■ Howard County Association
of REALTORS®
■ Mid-Shore Board of REALTORS® ■ Pen-Mar Regional Association
of REALTORS®
■ Prince George’s County Association
of REALTORS®
■ Southern Maryland Association
of REALTORS®
www.mdrealtor.org
Donnell Spivey President-Elect,
National Association
of Real Estate Brokers
T
he tenth of 13 children of North Carolina sharecroppers, Donnell Spivey learned his
family values at home, and in no uncertain terms. “My parents didn’t call them ‘family values,’” he notes, “but they showed us by example that there was nothing more important than treating everyone fairly, and maintaining relationships.” To this day, Donnell’s clients, colleagues, friends and neighbors know him by those long-held and honored values and by the tremendous energy, professionalism, and integrity that have propelled the long-time Baltimore area resident to the top of his field.
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MARYLAND REALTOR® JUNE | JULY 2013
17
Everyone should be treated fairly, and that means equal opportunities for housing.
For nearly 30 years, Donnell has distinguished himself in the real estate industry, where he’s known for his commitment to community building and sustainable homeownership. Donnell’s efforts promoting diversity in the profession have been lauded by authorities ranging from The Baltimore Sun to U.S. Congressman Elijah Cummings. In 2003, he was named “REALTIST of the Year” by the National Association of Real Estate Brokers (NAREB,) the nation’s oldest minority trade organization.
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Since attending his first NAREB convention in 1987, Donnell’s natural leadership abilities have been constantly in play. He has served on a number of the Association’s national committees, and is actively involved in its multicultural events, in cooperation with the National Association of Hispanic Real Estate Professionals (NAHREP) and the Asian Real Estate
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MARYLAND REALTOR® JUNE | JULY 2013
Association of America (AREAA). For the past three years, he has chaired NAREB’s involvement at an annual event of the Congressional Black Caucus Foundation (CBCF). In addition, Donnell has served as President, and then Chair, of NAREB’s local Baltimore chapter. Donnell was nominated to NAREB’s Board of Directors in 2003, becoming President-Elect in 2012. The focus of his upcoming administration, he says, will be continuing professional education and development, with an emphasis on the importance of sustainable homeownership—for practitioners as well as consumers. “The heart of NAREB is our motto, Democracy in Housing. Yet,” he goes on to say, “there are still segments of the American population that are woefully under-served. It is my mission to change that.” Echoing the deep-rooted values he has held since childhood, “Everyone should be treated fairly, and that means equal opportunities for housing.” Donnell maintains an active membership in the REALTOR® Associations at the local, state, and national levels. He also devotes his time and talents to the New Shiloh Baptist Church in Baltimore. In early August, at the 67th Annual Convention of the National Association of Real Estate Brokers in Denver, Colorado, Donnell Spivey will assume his highest leadership role to date, as its new President. With a laser focus, Donnell will lead NAREB in a direction that upholds opportunity for its members, and work untiringly for sustainable and affordable housing for all homebuyers.
www.mdrealtor.org
Economy, Markets Outperform Expectations A R e c o r d - S e t t i n g F i rs t Q u ar t e r Sequestration, which was supposed to begin January 1 of this year, was pushed back to March 1. Across-theboard federal spending cuts failed to materialize because many federal agency heads waited for the continuing resolution to pass, which would provide them with a firmer sense of available operational flexibility. Consequently, large corporate dividend payments last year, solid auto and home sales, a Federal Reserve commitment to ongoing monetary stimulus, a record-shattering stock market and a number of other factors gave us a better than expected first quarter this year, particularly in January and February.
E
conomic weakness was a bit more apparent in March, as tax increases imposed at the beginning of the calendar year began to make themselves felt. Employment growth slowed substantially (even though the U.S Bureau of Labor Statistics revised the initial March estimate of 88,000 new jobs to 138,000), particularly among retailers. According to the U.S. Bureau of Economic Analysis (BEA), monthly personal consumption expanded
www.mdrealtor.org
0.7 percent in February and 0.2 percent in March. However, the U.S. Census Bureau indicates that retail sales slipped 0.5 percent in March and expanded only 0.1 percent in April. Thus, we expect that after an above average first quarter, the second quarter will be materially softer as sequestration takes hold and as the impact of those large dividend payments begins to wane.
MARYLAND REALTORŽ  JUNE | JULY 2013
19
Exhibit 1: Consumer Spending, January 2008–March 2013
Source: U.S. Bureau of Economic Analysis
Exhibit 2: Change in Real Gross Domestic Product, Q2 2005–Q1 2013
Source: U.S. Bureau of Economic Analysis
Nevertheless, there remains enough momentum to keep the U.S. economy out of severe trouble. With the surge in energy production, an improving housing market, expectations for consumer spending, including on autos, and stable industrial production, the economy should manage to expand for the balance of the year. The composition of growth remains heavily tilted toward consumers, however, with business investment expanding only sporadically and public spending restraining overall economic growth. Net exports have been yet another source of macroeconomic weakness,
20
MARYLAND REALTOR® JUNE | JULY 2013
largely a reflection of weaker than anticipated export growth given shockingly weak performance in the Eurozone, economic slowing in England and Canada, softening economic conditions in China, India and Brazil and a weakening yen that has helped support Japanese exporters at the partial expense of American ones. Despite a sea of economic constraints and concerns, the first quarter of 2013 turned out to be a fabulous one for U.S. equity investors. The S&P 500 Index, the Dow Jones Industrial Average, and the Nasdaq all ended the first quarter of 2013 on a resounding
note. The S&P 500 rose 10 percent to 1,569.19 while the Nasdaq rose 8.2 percent to 3,267.52. Both the S&P 500 and the Dow Jones surpassed previous record closing highs in March. The Dow Jones was up 11 percent during the first quarter to 14,578.58—its best first-quarter performance in 15 years. More remarkably, major stock indices continue to break their best records. The S&P 500 closed above the 1,600-level on May 3rd for the first time in the history. As of this writing, the Dow Jones Industrial Average sits at an all-time high of 15,118.49 after crossing the 15,000 threshold on May 7th for the first time. Perhaps most remarkably, higher stock prices working in conjunction with recent increases in home prices have allowed Americans to collectively recoup the roughly $16 trillion in wealth that was lost during the Great Recession and its aftermath. According to the Federal Reserve, net worth for U.S. households reached $66.1 trillion during the fourth quarter of last year, representing the highest level in five years and more than 98 percent of the pre-recession peak of $67.3 trillion achieved in third quarter of 2007. First quarter Federal Reserve data are likely to indicate that collective household wealth is now at all-time high, though it remains true that much of the gain has been concentrated among a relatively small proportion of households (i.e., those that own significant amounts of financial assets). Corporate earnings continue to expand. The BEA reports that corporate profits rose to $2.013 trillion during the fourth quarter of 2012, an increase of 2.3 percent from the previous quarter and 3.1 percent compared to one year ago. According to the New York Times, corporate profits as a percentage of GDP are now at their highest level since 1950. First quarter 2013 earnings announcements have begun to trickle in, with the early returns remaining positive.
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Exhibit 3: State-by-State Job Growth, 12-Month Percent Change, March 2013 vs. March 2012 Rank
State
% Change
Rank
State
% Change
Rank
State
% Change
1
North Dakota
4.4
18
Maryland
1.5
33
Kentucky
0.7
2
Utah
4.2
19
New Jersey
1.4
36
Illinois
0.6
3
Texas
3.1
19
Oregon
1.4
37
Nebraska
0.5
4
Colorado
2.6
21
Louisiana
1.3
37
Wisconsin
0.5
5
Idaho
2.4
21
Mississippi
1.3
39
Arkansas
0.4
6
California
2.0
23
Delaware
1.2
40
Alabama
0.3
7
Florida
1.9
23
Massachusetts
1.2
40
Alaska
0.3
7
Georgia
1.9
23
Oklahoma
1.2
40
Missouri
0.3
7
North Carolina
1.9
23
South Carolina
1.2
40
New Mexico
0.3
7
Washington
1.9
27
New Hampshire
1.1
44
D.C.
0.2
11
Arizona
1.8
28
Indiana
1.0
44
Rhode Island
0.2
11
Montana
1.8
28
New York
1.0
46
Connecticut
0.1
13
Minnesota
1.7
30
Michigan
0.8
46
Maine
0.1
13
Nevada
1.7
30
Vermont
0.8
46
Ohio
0.1
13
Tennessee
1.7
30
Virginia
0.8
46
West Virginia
0.1
16
Hawaii
1.6
33
Iowa
0.7
46
Wyoming
0.1
16
South Dakota
1.6
33
Kansas
0.7
51
Pennsylvania
-0.1
Source: U.S Bureau of Labor Statistics
Normally, the stock market is considered a leading economic indicator. However, the current set of circumstances render matters a bit more complicated than usual. The market seems to prefer an economy that is expanding, but not too quickly to jeopardize current Federal Reserve policy, which represents a combination of incredibly low shortterm interest rates coupled with asset purchases intended to keep longer-term rates low as well. The recent run-up in the stock market reflects an expectation that the economic recovery will continue, but that the pace of growth will remain around 2 percent, which is where it has been for the most part since June of 2009 when the Great Recession ended. Improvements in the broader economy continue to support the recovery of the nation’s housing market. On a year-over-year basis, existing home sales nationally were up more than 10 percent in March, representing the 21st consecutive month of year-over-year sales www.mdrealtor.org
increases according to the National Association of Realtors®. The national median existing-home price for all housing types was $184,300 in March, up 11.8 percent from the March 2012 level. March represents the 13th consecutive month of year-over-year price increases and the strongest 12-month gain since November 2005. With prices rising, there is now a level of urgency among prospective buyers that was not apparent even a few months ago. Would-be buyers also remain concerned about the interest rate environment, fearing that access to ultra-low mortgage rates may soon be withdrawn. Maryland’s Economic Recovery Gains Momentum, Too For months, Marylanders, among others, have been fixated on the fiscal cliff. While the nation avoided diving off, it didn’t avoid the sequester, which officially began March 1st. The automatic spending cuts are expected to reduce national
growth by roughly half a percentage point this year. Additionally, payroll and other taxes rose on January 1st. All told, federal fiscal restraints will likely subtract 1–1.5 percentage points from growth this year. Despite these fiscal headwinds, Maryland’s economy actually gained momentum in early 2013, though some of the employment data seem almost too good (we suspect that the issues are related to seasonal adjustments). Between March 2012 and March 2013, the state added 37,700 jobs or 1.5 percent according to seasonally adjusted Bureau of Labor Statistics’ data. The Free State now ranks 18th in the nation with respect to year-over-year percentage job growth, better than Virginia, which ranked 30th during this period (+0.8%). Maryland’s employment base is now just 1,200 jobs shy of its December 2007 level, the month during which the Great Recession began. In terms of job growth, leading the way in Maryland are sectors such as construction (+5.3%), professional and business services (+3.1%), education and health services (+3.0%), leisure and hospitality (+2.6%) and financial activities (+1.5%). Some sectors shed jobs, however, including manufacturing (-3.3%), other services (-0.3%) and government (-0.1%) sectors shed jobs. Maryland’s unemployment rate, which remained steady at 6.6 percent in March, remains well below the April national jobless rate of 7.5 percent (7.6 in March). Economic momentum continued to be apparent in April. According to the Federal Reserve Bank of Richmond’s latest Maryland Survey of Business Activity, the general business activity index registered +6 for the month. It was down 4 points from March, however, and the expectations index fell by one point in April to 24, with roughly 41 percent of respondents expecting conditions to improve over the next six months while 17 percent expected business conditions to
MARYLAND REALTOR® JUNE | JULY 2013
21
Exhibit 4: Maryland Unemployment Rates by County, March 2013 (NSA) Rank
County
1
Unemployment Rate
Rank
4.9
13
Howard County
County
Unemployment Rate
Kent County
7.6
1
Montgomery County
4.9
14
Allegany County
7.8
3
Calvert County
5.6
15
Talbot County
7.9
4
Frederick County
5.7
16
Caroline County
8.0
5
St. Mary’s County
5.9
17
Washington County
8.1
5
Anne Arundel County
5.9
18
Garrett County
8.3
7
Charles County
6.0
19
Wicomico County
8.7
8
Carroll County
6.1
20
Cecil County
8.8
9
Queen Anne’s County
6.4
21
Baltimore City
9.6
10
Prince George's County
6.5
22
Dorchester County
10.5
11
Harford County
7.0
23
Somerset County
10.8
12
Baltimore County
7.1
24
Worcester County
14.6
Because of ultra-low mortgage rates and interest rates generally, housing and auto sales are expected to remain solid. Increasingly, the public is coming to believe that home prices will rise going forward, creating a sense of urgency that has been lacking among prospective buyers since 2007. Indeed, median and average prices have been rising impressively on a year-over-year basis in Maryland.
Source: U.S. Bureau of Labor Statistics
deteriorate. The slight decline in expectations is probably not statistically significant and therefore does not represent cause for immediate alarm.
2013), positioning the market for further healing and price gains in 2013 despite a recent surge in foreclosure filings.
As with the nation, the best news for Maryland’s economy continues to come from the housing market. The state’s overall unit sales are up 14.2 percent on a year-overyear basis (for April 2013) and the average home sales price is up 2.3 percent. Unsold inventory continues to dwindle (active listings are down 17.7 percent year-over-year; April
Looking Ahead One of the keys will be the performance of financial markets. The stock market’s nearly uninterrupted rally over the past several months has created substantial spending power among shareholders, which in turn has increased consumer spending and helped to stabilize
Exhibit 5: Average Home Prices, by Jurisdiction, April, 2013 and 2012 Jurisdiction 1
Kent
Jurisdiction
2013
2012
% Chg.
$341,500
$182,714
86.9%
13
Howard
$396,761
$397,784
-0.3%
2012
% Chg.
2
Allegany
$117,525
$92,124
27.6%
14
Harford
$255,913
$257,202
-0.5%
3
Washington
$191,536
$152,777
25.4%
15
Baltimore County
$251,393
$254,900
-1.4%
4
Frederick
$301,440
$259,926
16.0%
16
Worcester
$251,378
$255,111
-1.5%
5
Garrett
$365,886
$318,094
15.0%
17
Charles
$230,359
$235,080
-2.0%
6
Wicomico
$153,638
$138,761
10.7%
18
St. Mary's
$264,073
$276,258
-4.4%
7
Calvert
$320,607
$291,061
10.2%
19
Cecil
$202,337
$243,450
-16.9%
8
Prince George's
$202,077
$183,957
9.9%
19 Somerset
$130,825
$157,488
-16.9%
9
Montgomery
$493,004
$464,443
6.1%
21 Dorchester
$183,996
$229,335
-19.8%
10 Carroll
$298,072
$281,345
5.9%
22 Caroline
$206,626
$271,812
-24.0%
11 Baltimore City
$165,596
$156,671
5.7%
23 Queen Anne's
$418,007
$568,711
-26.5%
12 Anne Arundel
$369,588
$365,152
1.2%
24
Source: Maryland Association of REALTORS®
22
2013
MARYLAND REALTOR® JUNE | JULY 2013
Talbot
$375,675
$623,172
confidence. However, should there be a correction sometime during the summer and fall, confidence will dwindle rapidly along with net household wealth, which could put pressure on retailers and service providers alike.
-39.7%
While many of Maryland’s more urban and suburban housing markets to begin to recover, recent data indicate that the Eastern Shore and other less densely populated parts of the state have begun to participate more forcefully in the recovery. The sustainability of the housing rally does not seem to be at issue presently. Housing market fundamentals are now much improved, with the active inventory of unsold homes now quite low in Montgomery, Howard and Prince George’s counties, prompting more building activity. Recent pending sales data also indicate ongoing interest among prospective buyers. Despite a solid start to the new year, we are not out of the proverbial woods. The U.S. economy could slow significantly during the next few months as federal spending cuts begin to take hold. In fact, that is precisely what Sage anticipates. After expanding in the neighborhood of 3 percent for much of the first quarter, growth is more likely to be closer to 2 percent for the balance of the year. However, with the improving housing market, increased energy production and expected consumer activity we anticipate that the economy will expand throughout the year. Anirban Basu, Chairman & CEO, Sage Policy Group, Inc.
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n o i t a s t Educ h g i l h g i H
ne fo u n d o n li e b n a c n r m a t io e v e n t in fo d n a s e s r n n e r. li s t o f c o u t h e to p b a n o k A c o m p le te c li C . g r d r e a lt o r. o a t w w w.m
❱ Bill Lublin presents Technology! ❱ Al Monshower is back teaching “Contracts” for ALL AGENTS
❱ DC & DE CE offerings are available this year ❱ All the CE you need: Legal & Legislative; Fair Housing; Ethics, new Professional Enhancement courses, plus much more
❱ Commercial Agency & Dissecting the
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Commercial Lease on Monday
❱ Chandra Hall presents “CRACKING THE CREDIT CODE: THE KEY TO MORE CLOSINGS”
❱ MRIS & XACTSITE classes—all 3 days! Chandra Hall
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BESTALUE! V 3-Day Registration! ❱ FREE Sam’s Club insulated bag ❱ FREE Continental Breakfast &
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Real Estate EXPO
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Cocktail Reception & Recognition Banquet with Installation of Officers Tuesday, September 10, 6:30 p.m. Cost: $75.00 Russ Boyce, 2014 MAR President
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2013ONFERENCE C NSORS SPO Main Conference Sponsors MRIS Pen Fed Credit Union
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Overall Conference Sponsors Carroll County Association of REALTORS® EXIT Realty Mid-Atlantic Garrett County Board of REALTORS® MHREIA Maryland state Women’s Council of REALTORS (WCR) Chapter
REALTOR Business Center Coldwell Banker Residential Brokerage
NAR Directors Breakfast Howard County Association of REALTORS®
Continental Breakfasts Coastal Association of REALTORS®
Wednesday’s Beverage Break Prince George’s County Association of REALTORS®
Installation Banquet Cocktail Reception & Wine Tasting Long & Foster Real Estate Bill Armstrong, 2000 MAR President Bill Neary, 2002 MAR President Billie Landbeck, 1978 MAR President Carlton Boujai, 2013 MAR President Carole Maclure—2013 MAR Treasurer, 2008 MAR President Cathy Werner, 2011 MAR President Ilene Kessler, 2007 MAR President JoAnne Poole, 2005 MAR President John Harrison, 1997 MAR President Pat Terrill, 2012 MAR President Steve Meszaros, 2010 MAR President
Regulation News
MARK FEINROTH
Short Sale Update: Third Party Negotiators A recent enforcement action brought by the Maryland Commissioner of Financial Regulation has further complicated the short sale approval process.
I
n recent years, short sellers have increasingly relied upon licensed credit services businesses to assist in obtaining lender approval and release of the mortgage company lien. In Maryland, if the lender requires negotiation of a deficiency payment agreement, the company that assists in the process must hold a credit services business license issued by the Office of Financial Regulation (Fin Reg) of the Department of Labor, Licensing and Regulation. Fin Reg ordered one such licensee, ATC Financial, to stop its efforts on behalf of homeowners seeking short sale approvals. The order was modified and an administrative hearing is scheduled so that ATC may continue to perform short sale service, but the entire matter raises an important question for short sellers and their real estate agents. Who pays for the service provided? Fin Reg charged ATC with various violations of the Maryland Credit Services Business Act and the Maryland Mortgage Fraud Protection Act. The Regulator alleged
REALTORS® should advise clients who are short sellers to be very cautious when considering whether to engage a credit services business to assist in obtaining short sale lender approval.
that ATC was hiding its fees on HUD 1 settlement statements by labeling them everything from “mandatory regulatory fees” to “attorney fees.” Fin Reg concluded that ATC was falsely describing its fee on the HUD 1 so the lender would allow the company to be paid from the proceeds of the short sale transaction. Because the lender agreed to release its lien for an amount less than that which the seller owed on the mortgage, ATC’s allegedly deceptive labeling of its fee resulted in the lender paying for the short sale assistance service. MAR has heard from some real estate brokers that short sale negotiators have asked to have their fees included in the sales commission paid to the brokerage in an effort to have the broker pay transmit the fee to the negotiation firm at some point after closing. The brokers we have heard from declined to conduct business in this manner, largely because the Real Estate Brokerage Act prohibits a broker from paying part of the sales commission to a person or entity that is not licensed by the Real Estate Commission. REALTORS® should advise clients who are short sellers to be very cautious when considering whether to engage a credit services business to assist in obtaining short sale lender approval. The lender or mortgage servicer should be asked in advance if it will agree to pay for the service from the proceeds of the sale. If the lender or servicer refuses, clients should carefully consider who will eventually pay for the work performed by the third party negotiator. It could eventually be the seller’s responsibility to pay the fee out of pocket. Please feel free to contact me at mark.feinroth@ mdrealtor.org if you have any questions regarding this subject. Mark Feinroth, Esquire, MAR Director of Regulatory affairs.
26
MARYLAND REALTOR® JUNE | JULY 2013
www.mdrealtor.org
Residential Sales
ANIRBAN BASU
Housing Market Remains in Full Bloom as Spring Approaches Dwindling Inventory Brings Rising Sales Prices According to data available through the National Association of REALTORS®, there is now more demand than supply in the contemporary housing market. This is far cry from four years ago, when the market sagged under the weight of foreclosures, falling credit scores and plunging appraisal values. Nationally, total existing home sales in March declined 0.6 percent to a seasonally adjusted annual rate of 4.92 million units, down from 4.95 million units in February. Weather likely played a part in the monthly decline, as did growing inventory constraints. There is simply less inventory for buyers to choose from relative to a year or two ago.
T
he same phenomenon is apparent in Maryland.
On a year-over-year basis, existing home sales nationally were up more than 10 percent in March, the 21st consecutive month of year-over-year sales increases. The national median existing-home price for all housing types was $184,300 in March, up 11.8 percent from the March 2012 level. This makes March the 13th consecutive month of year-over-year price increases, and the strongest 12-month gain since November 2005. With prices rising, there is now a level of urgency among prospective buyers that was not apparent even a few months ago. Would-be buyers also remain concerned about the interest rate environment, fearing being that access to ultra-low mortgage rates may soon be withdrawn. Maryland’s housing market dynamics also remain positive, with both unit sales and sales prices exhibiting gains in both March and April. According to data supplied by MRIS and the Coastal Association of REALTORS®, home sales statewide rose 7.1 percent in March on a year-over-year basis. Twenty of Maryland’s 24 jurisdictions experienced sales increases that month, including Caroline (76.9%); Calvert (43.9%); Kent (36.4%); Charles (29.2%); Somerset (25.0%); Dorchester (20.8%); St. Mary’s (20.6%); Garrett County (15.0%); Harford
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MARYLAND REALTOR® JUNE | JULY 2013
(14.5%); Talbot (13.8%); Montgomery (13.2%); Carroll (11.7%); Cecil (10.3%); Frederick (7.3%); Washington (7.2%); Allegany (6.9%); Baltimore City (6.5%); Queen Anne’s (4.9%); Howard (2.8%); and Prince George’s (1.8%). Importantly, many of the jurisdictions with sales gains are in rural Maryland, where the housing market has generally been a bit slower to recover relative to more urban or suburban markets. Unlike markets such as Howard and Montgomery counties, active inventories of unsold homes in many rural markets are relatively higher (measured in months of supply), which means that inventory constraints are less likely to impact sales volumes over the near-term. Sales declines in Maryland’s other four jurisdictions were extremely moderate, with only Worcester County reporting a year-over-year decline in March sales exceeding 2 percent (2.1%). The pace of home sales was even brisker in April. Home sales were 14.2 percent higher than during the same month a year ago. Again, many rural counties reported sharp sales increases, including Somerset (50.0%); Talbot (33.3%); St. Mary’s (32.9%); Wicomico (23.4%) and Worcester (23.4%). Falling unsold inventory is consistent with sales price increases, precisely what has been observed in recent months. Both average and median sales prices in
www.mdrealtor.org
March 2013 vs. 2012 Units
Average Price
County
2013
2012
% Change
2013
2012
% Change
Allegany
31
29
6.9%
$106,956
$83,367
28.3%
Anne Arundel
425
430
-1.2%
$344,278
$329,120
4.6%
Baltimore City
444
417
6.5%
$156,412
$136,604
14.5%
Baltimore County
561
562
-0.2%
$230,997
$219,799
5.1%
Calvert
82
57
43.9%
$310,607
$293,608
5.8%
Caroline
23
13
76.9%
$148,231
$110,954
33.6%
Carroll
115
103
11.7%
$283,718
$274,399
3.4%
Cecil
64
58
10.3%
$215,773
$191,729
12.5%
Charles
155
120
29.2%
$239,119
$239,144
0.0%
Dorchester
29
24
20.8%
$180,342
$107,317
68.0%
Frederick
221
206
7.3%
$277,818
$260,743
6.5%
Garrett
23
20
15.0%
$236,804
$293,150
-19.2%
Harford
189
165
14.5%
$258,532
$245,610
5.3%
Howard
223
217
2.8%
$390,952
$391,068
0.0%
Kent
15
11
36.4%
$324,100
$302,090
7.3%
Montgomery
826
730
13.2%
$484,775
$436,849
11.0%
Prince George’s
665
653
1.8%
$192,375
$173,584
10.8%
Queen Anne’s
43
41
4.9%
$375,337
$275,357
36.3%
Somerset
15
12
25.0%
$79,980
$103,250
-22.5%
St. Mary’s
82
68
20.6%
$260,233
$266,199
-2.2%
Talbot
33
29
13.8%
$537,758
$518,948
3.6%
Washington
104
97
7.2%
$147,631
$145,771
1.3%
Wicomico
67
67
0.0%
$145,403
$137,687
5.6%
Worcester
138
141
-2.1%
$244,002
$285,538
-14.5%
TOTAL 4,573
4,270
7.1%
$288,121
$267,706
7.6%
Figures reflect resales and new properties. Residential resales are reported by MRIS® and local boards MLS systems.
Maryland rose in March and April on a year-over-year basis. Average statewide sales price rose 7.6 percent, and median price rose 6.8 percent. Eighteen jurisdictions reported increases in average sales price, while 17 experienced higher median prices on a year-over-year basis in March. www.mdrealtor.org
®
MARYLAND REALTOR® JUNE | JULY 2013
29
All of this is evidence that Maryland’s housing market recovery now embodies a growing share of rural markets.
April 2013 vs. 2012 Units
Average Price % Change
Prices climbed less rapidly in April on a year-over-year basis, however. Average sales price increased 2.3 percent in April compared to a year ago, while median price was up 3.3 percent. Only 12 jurisdictions reported higher average sales prices compared to a year ago, while 15 reported higher median sales prices. Jurisdictions experiencing significant year-over-year increases in sales prices included Kent County, where the average price increased 86.9 percent and median price rose 119.5 percent; Washington County, where the average price rose 25.4 percent and median price increased 25 percent; and Allegany County, where the average price increased 27.6 percent and median price rose 11.1 percent. It is possible that a recent surge in foreclosure activity somewhat diminished price appreciation momentum in April.
County
2013
2012
% Change
2013
2012
Allegany
37
39
-5.1%
$117,525
$92,124
27.6%
Anne Arundel
545
478
14.0%
$369,588
$365,152
1.2%
Baltimore City
513
419
22.4%
$165,596
$156,671
5.7%
Baltimore County
641
544
17.8%
$251,393
$254,900
-1.4%
Calvert
79
72
9.7%
$320,607
$291,061
10.2%
Caroline
20
17
17.6%
$206,626
$271,812
-24.0%
Carroll
126
115
9.6%
$298,072
$281,345
5.9%
Cecil
68
56
21.4%
$202,337
$243,450
-16.9%
Charles
129
108
19.4%
$230,359
$235,080
-2.0%
Dorchester
24
27
-11.1%
$183,996
$229,335
-19.8%
Looking Ahead
Frederick
244
212
15.1%
$301,440
$259,926
16.0%
Garrett
22
24
-8.3%
$365,886
$318,094
15.0%
Harford
200
184
8.7%
$255,913
$257,202
-0.5%
Howard
274
267
2.6%
$396,761
$397,784
-0.3%
Kent
13
14
-7.1%
$341,500
$182,714
86.9%
Montgomery
985
872
13.0%
$493,004
$464,443
6.1%
Prince George’s
725
649
11.7%
$202,077
$183,957
9.9%
Queen Anne’s
50
45
11.1%
$418,007
$568,711
-26.5%
Somerset
12
8
50.0%
$130,825
$157,488
-16.9%
St. Mary’s
93
70
32.9%
$264,073
$276,258
-4.4%
Thanks in large measure to Federal Reserve policy, mortgage rates remain extraordinarily attractive. Sales and price momentum are decidedly positive, generating more buyer interest. This is consistent with pending sales figures, which are up substantially in much of Maryland, including in Baltimore City, Baltimore County and in Anne Arundel County. Perhaps the biggest issue for Realtors, title attorneys and others is the relative lack of available inventory in a growing number of Maryland jurisdictions. Statewide active inventory of unsold homes fell to just 4.5 months April, down from 6.3 months one year ago. Inventory in both Montgomery and Prince George’s counties is down to 2.1 months and is below 3 months in Howard County.
Talbot
52
39
33.3%
$375,675
$623,172
-39.7%
Washington
108
100
8.0%
$191,536
$152,777
25.4%
Wicomico
79
64
23.4%
$154,947
$144,454
7.3%
Worcester
153
124
23.4%
$250,209
$263,119
-4.9%
TOTAL 5,192
4,547
14.2%
$262,7400
$265,920
-1.2%%
Figures reflect resales and new properties. Residential resales are reported by MRIS® and local boards MLS systems.
The largest price increases occurred in Allegany County, where the average price was up 28.3 percent and median price rose 80 percent. In Caroline County, average price rose 33.6 percent and median price rose 44.2 percent. In Dorchester County, average price increased 68 percent and median price was up 35 percent.
30
MARYLAND REALTOR® JUNE | JULY 2013
The broader economic context has improved meaningfully of late both in Maryland and the U.S. as a whole. The labor market continues to progress despite sequestration and higher taxes. According to the U.S. Bureau of Labor Statistics’ (BLS) preliminary estimate, the nation added 165,000 jobs in April; estimates for February and March were revised higher. Maryland employment growth has also been solid, with the state adding nearly 38,000 jobs over a recent 12-month period according to BLS. We anticipate that the continued growth of jobs and the pent up demand for home buying will contribute to a robust selling season in the months ahead. Anirban Basu, Chairman & CEO, Sage Policy Group, Inc.
www.mdrealtor.org
Maryland Real Estate Commission News
k a t h er i ne c o nne l l y
Reminder: 2012/13 Agency and Broker Supervision CE Requirements
T
he agency and broker supervision Continuing Education (CE) requirements adopted during the 2010 session of the Maryland General Assembly became effective on January 1, 2012. The law lays out new CE requirements for agency and supervision. Licensees who plan to renew a Maryland real estate license should make sure that they have complied with the new law. The new CE requirements came at the request of the Real Estate Commission. The Commission concluded that an increase in consumer complaints reflected a need for licensees to review principles of agency and agency disclosure periodically. A growing number of consumer complaints involve a defective agency disclosure and a subsequent failure of a broker, branch office manager or team leader to take whatever action was necessary to correct the agent’s mistake. The new requirement is a three hour agency class for the next real estate license renewal that occurs after January 1, 2012, followed by a three hour agency class every four years. The Commission has approved three hour courses in both commercial and residential agency. The new supervision course requirement applies only to licensees who are required by law to supervise subordinates. Those who must take a supervision course are brokers and licensees who are designated team leaders or branch office managers. As with the agency course, the supervision course must be three hours and taken prior to a license renewal that occurs in either 2012 or 2013. After the first supervision course, affected licensees must take the class at least every four years thereafter.
www.mdrealtor.org
Additionally, the Commission has promulgated a regulation requiring that licensees must take the Supervision course within 90 days of becoming a broker, branch office manager or team leader, if they have not already taken the course. Most licensees are required to take a total of at least 15 hours of CE over the two year term of their real estate license in order to renew. Licensees who hold a graduate degree in law or real estate from an accredited college or university are only required to take at least 7.5 hours of CE during the two year license term. For them, when the agency class is taken once every four years, it substitutes for the three hour legal/legislative update course(Category A). These licensees are therefore permitted to alternate in successive two year licensing periods the agency course and the legal/legislative update course. These rules can be confusing. The Real Estate Commission staff is ready to assist licensees who need to clarify which courses they must take prior to license renewal time. We have charts on our website with all thepossible scenarios of licensure, which we believe are self-explanatory. Go to www.dllr.state.md.us/license/ mrec/mreceducreq.shtml Our goal is to ensure that every licensee has the required CE well before license expiration. Please feel free to contact me with any questions at kconnelly@dllr.state.md.us. Katherine Connelly is the Executive Director of the Maryland Real Estate Commission. If you have other questions regarding the digital CE record system or any other matter concerning your Maryland real estate license at contact her at kconnelly@dllr.state.md.us or visit http://www.dllr.state.md.us/license/mrec
MARYLAND REALTOR® JUNE | JULY 2013
31
HOMEOWNERSHIP SNIPPETS PAMPERING CREDIT
ARE YOU WHC?
“Pampering” in this context means consumers showing potential lenders that they don’t borrow more than they can afford, and that they regularly pay back what they owe. 1
Advantages of Being a Workforce Housing Certified (Whc) Realtor®
The result of using credit (wisely or unwisely) impacts consumer credit scores, which determines the interest rate on any loan. For example, a higher interest rate could end up costing a borrower almost $90,000 over the life of a typical mortgage in Maryland.
Obtain a comprehensive, professional overview of working with homebuyers
Consider that FICO, the score used by most lenders for mortgage loans, computes a credit score based on the following percentages: 2 So, how does a consumer pamper his credit? ❱ Make payments on time (or earlier), especially on revolving debt such as credit cards ❱ Make more than the minimum payment and keep balances low. Use only about 30% (50% maximum) of the available credit on any one credit card or account ❱ Keep those older accounts to continue building account history
(A designation from the Maryland Association of REALTORS®)
Learn to analyze mortgage financing options like a Lender Discover financing sources for first-time homebuyers, critical workforce employees (such as police, firefighters, teachers, medical staff and technicians), special populations (including persons with disabilities and aging citizens), beyond the everyday choices. Learn about options for down payment and closing cost assistance for buyers Get listed on the online, revolving database of REALTORS® who have completed the course Join the LinkedIn WHC Group to get regular updates/ tips on financing Earn 6 hours of CE credit for Professional Enhancement Become a certified CreditSmart® Trainer
Amounts Owed Types of Credit Used New Credit Length of Credit History Payment History
❱ Open new credit, either installment loans or credit cards only as needed and pay them off on time
If you have a ‘ridiculously useful website’ to share with fellow REALTORS®, email: melissa.lutz@mdrealtor.org
Sources: ‘25,000 Reasons to Pamper Your Credit’ by Ben Edwards on the website, WISE BREAD, 10/6/2010
1
2
32
www.Myfico.com
MARYLAND REALTOR® JUNE | JULY 2013
The sites are presented for information only. MAR is not responsible for the content of external websites and does not endorse them or their functionality. Although we make every effort to ensure these links are accurate, up to date and relevant, MAR cannot take responsibility for pages maintained by external providers. Views expressed by individuals and organizations on their own websites are not necessarily those of the Maryland Association of REALTORS®.
www.mdrealtor.org
NEWS ON THE STREET BB&T announced changes to Community Homeownership Incentive Program (CHIP) now requires 3% down payment. Private mortgage insurance is waived. First-time home buyers and previous homeowners are eligible; however, income cannot exceed 80% of county median income. Consult a BB&T Mortgage Professional for details. Wells Fargo Programs Community Development Mortgage Program (CDMP) 2% down payment (including gifts and funds from approved sources), no mortgage insurance required, income must be below 80% of area median and borrower does not have to be a first-time buyer, seller contributions up to 3%. Neighborhood Community Development Mortgage Program (NCDMP) 5% down payment (including gifts and funds from approved sources), no mortgage insurance required, borrower does not have to be a first-time buyer, but must purchase in a low-to-moderate income census tract. Reserves required equivalent to two-month PITI.
FAMILY LIVES HERE
Credit Union Financing for First-Time Buyers At the end of 2012, mortgage loans as a portion of the total loan portfolio held by credit unions, reached an all-time high of 29.1%. The Economic and Statistics Department of the Credit Union National Association (CUNA) reported that first mortgage delinquency dropped from 2.22% in December 2011 to 1.44% in December 2012. With rock bottom mortgage rates, fixed-rate first mortgages also turned in a solid 7.4% growth, their fastest rate since 2009. Total growth in credit union first mortgages was 5.9%, compared to 4.2% in 2011. Over 50% of all credit unions offer first mortgages. In Maryland, credit unions control $4.5 billion in first mortgages, about 23% of their total assets, comparable to the national 24% proportion.
www.mdrealtor.org
RCR-Baltimore.com
1 to 3 Bedroom Luxury, Resort-Style Condominiums in Baltimore’s Inner Harbor. Priced from $499,000. Immediate Occupancy | 866.922.1831 801 Key Highway, Baltimore, Maryland 21230 The Ritz-Carlton Residences, Inner Harbor, Baltimore are not owned, developed or sold by The Ritz-Carlton Hotel Company, L.L.C. An affiliate of RXR Realty LLC uses The Ritz-Carlton marks under license from The Ritz-Carlton Hotel Company L.L.C. This is neither an offer to sell nor a solicitation to buy to residents in states where registration requirements have not been fulfilled. MHBR No. 4096. An RXR Realty development. †Services provided by third-party companies are paid a la carte by the resident who requests the service.
MARYLAND REALTOR® JUNE | JULY 2013
33
From the Hotline
c h a r l e s A . K a s k y, e s q u i r e
Changing Broker Affiliation How Your Commissions Could Be Affected
Q. A.
I am a licensed salesperson and considering affiliating with a different broker. Am I entitled to my usual commission for transactions that are under contract but not yet closed?
The Salesperson filed a lawsuit against the Broker, arguing that she was entitled to receive the entire commission amounts because she had earned her commission once the parties entered into the purchase contract. The trial court ruled in favor of the Brokerage, and the Salesperson appealed.
This is a frequent call to the Legal Hotline. The answer is probably yes, but we prefer that it be addressed in the Independent Contractor Agreement salespersons and brokers sign when the salesperson first becomes affiliated with the broker. A recent case illustrates how this could play out.
The Court of Appeals (Iowa) reversed the lower court. The trial court had determined that the Salesperson, per the oral agreement between the Broker and Salesperson, did not earn her commissions until the transaction closed. Because the Salesperson was no longer an employee of the Brokerage, the lower court determined that the Brokerage had no duty to pay her.
A real estate Salesperson transferred her license to a Brokerage and worked out of a particular office. There was no written agreement establishing the terms of the relationship between the Brokerage and the Salesperson over the payment of commissions, including the time when the Salesperson earned her commissions. For the first two years, the Brokerage paid the Salesperson according to an orally agreed-upon schedule. In July 2009, the Broker told the Salesperson that he was going to close her location, but she could commute to the Brokerage’s other office. The Salesperson declined to commute to the other office, and made plans to move her license to another brokerage. Prior to the move, the Broker terminated the Salesperson’s relationship. At the time, she had four transactions under contract. Following the Salesperson’s departure, all four of the pending transactions closed. Broker reduced each of the commission checks from what the Salesperson had previously received when a transaction closed. The Broker explained that he altered the payment because of the additional work required to complete each transaction. In total, the Salesperson’s commissions were reduced by $8,800.
The appeals court ruled that the Salesperson earned her commissions prior to her departure from the Brokerage. Other courts have determined that the commissions are earned once the parties execute a binding contract. Because there was no contract between the Salesperson and Brokerage requiring the payment of commissions only on closed transactions, the court found that the Brokerage owed the Salesperson the entire commission amounts. We always first look to the brokerage agreement to determine when the broker earns the commission, and find that often the commission is earned when a contract is signed. We have also consistently said that a broker may pay a salesperson directly, even if the salesperson is no longer affiliated with that broker, as long as the salesperson earned the commission while affiliated with that broker. Putting those elements together, it is easy to agree with the court’s holding in this case. However, litigation could have been avoided entirely if the broker and salesperson agreed at the beginning of the relationship how things like this would be handled. We strongly urge brokers and salespersons to enter into comprehensive independent contractor agreements that address matters like this. Charles A Kasky, Esquire, Senior Vice President, Maryland Association of REALTORS®.
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MAR LEADERSHIP ACADEMY Preparing Tomorrows Leaders Today
PA R T I C I PA N T A P P L I C AT I O N — 2 0 1 3 – 2 0 1 4 INSTRUCTIONS Applicant must have been licensed since February 1, 2013. Type or print information clearly and complete each section fully. Application must be signed and returned no later than August 1, 2013. I. PERSONAL DATA Date:_____________________________________________________________________________________________ Full Name:________________________________ Nickname Preferred:________________________________________ Home Address:_____________________________________________________________________________________ Business Address:___________________________________________________________________________________ Home Phone:_________________________________ Business Phone:________________________________________ E-mail Address:__________________________________________ Fax:________________________________________ Year Licensed:_________________________ Years in REALTOR® Assn. :________________________________________ How did you hear about the Academy?_________________________________________________________________ Real Estate Specialty (check all that apply): Appraisal Commercial International Property Mgmt. Residential Auction Counseling Land Relocation Other:____________________________________________________________________________________________ Real Estate Designations Earned (check all that apply): ABR ARM CAE CRB CIPS GREEN PRE REPA SIOR ABRM AMO CCIM CRS e-Pro GRI RAA RSPS SRES ALC BPRO CPM CRE GAA PMN RCE SFR TRC Other: ____________________________________________________________________________________________ II. EDUCATION Please specify highest level attained. GED Associates Degree Masters Degree Trade School High School Bachelors Degree Doctorate Degree Other:____________________________________________________________________________________________ B. Leadership positions held, special honors and awards received: _________________________________________________________________________________________________ _________________________________________________________________________________________________ III. WORK EXPERIENCE Present Firm Name:_________________________________________________________________________________ Position:__________________________________________________________________________________________ A. Briefly describe your responsibilities in your job: _________________________________________________________________________________________________ _________________________________________________________________________________________________ B. What do you consider your highest career achievement to date? _________________________________________________________________________________________________ _________________________________________________________________________________________________
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C. Business/Professional Affiliations (if any) (Please include local Board of REALTOR®, MAR and NAR involvement.) Name of Group
Positions Held or Assignments
Period of Affiliation
IV. COMMUNITY INVOLVEMENT A. Include community, civic, religious, political, governmental, social, athletic or other activities. Do not include business/professional activities. Organization
Assignment/Position
Describe Resposibilities
B. If you have additional significant community, civic, religious, political, social, athletic or other areas of active involvement, please attach statement. V. COMMITMENT (To graduate from the MAR Leadership Academy, a participant is required to attend all sessions.) Session 1—Orientation & Organizational Leadership—Styles & Visioning—October 10, 2013 Session 2—Organizational Long Range Planning—Leading the Organization—November 14, 2013 Session 3—Professional Conduct and Governance—December 5, 2013 Session 4—The Role of the Association in Legislation/Government Affairs—January 14, 2014 Session 5—Effective Communications—Media Relations—February 6, 2014 Session 6—Business Trends & Goal Re-Visitation—March 6, 2014 Session 7—Diversity in Business—April 3, 2014 Session 8—Closing Leadership Academy Recognition Ceremony—April 15, 2014 Mail application to: MAR Leadership Academy, 200 Harry S. Truman Pkwy, Ste. #200, Annapolis, MD 21401-7406 Interview Locations: Please select priority order with “1”. Time Range: 9 a.m.–3 p.m. (Later if necessary) _____ ANNAPOLIS 8/8 _____ANNAPOLIS 8/20 DEADLINE FOR APPLICATION SUBMITTAL IS AUGUST 1, 2013. All applicants will be interviewed. After interview applicants will be notified of acceptance by September. I understand the purposes of the MAR Leadership Academy program; and, if I am selected I will devote the time and resources necessary to complete the program. Sessions 1 through 7 are mandatory for completion. If a participant misses one (1) session, he/she will be allowed to continue with the class but will not graduate until the missed session is made up, as approved by the Committee, not later than the next year’s program. If a participant misses more than one session, he/she will be asked to withdraw, reapply and repay when he/she is able to make the commitment. No refund will be given. I understand the above commitments and agree to be bound by them in signing this application.
Applicant Signature____________________________________ Date _______________________________________ Print Name:_______________________________________________ Tuition: If accepted into the MAR Leadership Academy program, you will be personally billed for the $700 tuition fee with payment due prior to program start for course admittance.
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MARYLAND REALTOR® JUNE | JULY 2013
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