December 2011/January 2012

Page 1

VOLUME XLV Number 7

The Maryland Association of REaltors®

DECEMBER 2011 / JANUARY 2012

www.mdrealtor.org

The Voice for Real Estate in Maryland ®

WE’RE

GOING BOAT

TO NEED A BIGGER p 7

Consumer Website: WWW.MARYLANDHOMEOWNERSHIP.COM p 10

p 15

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President’s Perspective Patricia Terrill

RPAC – WHY NOW? in RPAC. But this is exactly when our support is most

REALTORS® ARE GOING TO NEED A BIGGER BOAT

essential. Tight budgets mean local, state and federal

MAR lobbyists and local government affairs directors will be

governments are on a search for more sources of revenue,

will be intensely focused on challenges from state and

and despite housing’s many challenges, our industry and

governments this year. See page 7 for a summary of the most

our profession remain a tempting target. Now more than

important issues.

The tough economy makes it hard for many of us to invest

ever, we need a strong PAC. Our fair share is only $15—a small but essential investment in our profession. It’s up to

RPR—A NEW FREE BENEFIT

each of us to protect our livelihood. To contribute go to

Real Property Resource (RPR), a significant FREE benefit to

www.mdrealtor.org, Top Destinations, and click on RPAC

REALTORS®, is now available to Maryland REALTORS®. See

Online Contribution.

page 22 for information about the extraordinary tools available to you to serve clients and customers.

DESIGNATIONS ARE BECOMING A ‘MUST’ FOR REALTOR® EDUCATION

From the MAR Leadership Team and Staff, our warmest

More than ever, we must demonstrate our value and

wishes for a Happy, Healthy and Prosperous New Year.

expertise to clients. Designations and Certifications help set you apart and showcase your professionalism. See pages 15-18.

To make it even easier for you to respond and significantly increase our Calls for Action responses, simply download the NAR REALTOR® Action Center App to your smartphone. Go to www.mdrealtor.org for details, or scan the QR Code for the MAR website. M A R Y L A N D R E A L T O R ® December 2011/January 2012

3


November 2011

7

F eature s 7 LEGISLATIVE PREVIEW We’re GOING to need a bigger BOAT 10 ECONOMIC FORECAST U.S. Economy No Longer Deteriorating 15 Realtor® Family Designation Programs 19 FREE Webinar Thursday Series

10

22 Realtors Property Resource, LLC Launches Broker Tool Sets

table of contents D epartment s

REALTOR® Family

Designation Programs

15

3 President’s perspective

5 2012 MAR LEADERSHIP TEAM

20 2012 GRI Schedule 24 MARYLAND REAL ESTATE COMMISSION NEWS Paperless Licensing Announced 26 regulation news Commission Wins Big in Maryland High Court 28 snippets

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22 4

M A R Y L A N D R E A L T O R ® December 2011/January 2012

30 MRIS UPDATE Top 11 Core Enhancements of 2011 33 commercial connection Commercial Lending and “Skin in the Game” 34 FROM THE HOTLINE Recent Maryland Cases Create Uncertainty 35 RESIDENTIAL SALES Housing Market Indicators Slump Again in October


2012 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 Patricia A. Terrill

Carlton J. Boujai Jr.

President Prudential PenFed Realty 7500 Coastal Highway Ocean City, MD 21842-2937 800.638.3242 Fax 410.524.5695 pat.terrill@gmail.com

President - Elect EXIT Realty Prosperity Group 5300 Westview Drive Suite 105 Frederick, MD 21703-8339 301.698.8700 carltonboujai@mris.com

Patricia A. Terrill | President Carlton J. Boujai Jr. | President-Elect J. Russell Boyce | Secretary Carole A. Maclure | Treasurer Cathy A. Werner | Immediate Past President Mary C. Antoun | Chief Executive Officer

Editor Deborah L. Hager | debbie.hager@mdrealtor.org

Advisory Committee Ron Howard | Co-Chair Lynette Bridges-Catha | Co-Chair Yolanda Muckle | Vice Chair

Advertising & Publication Design Art Comp & Design Alison Cooper | Senior Designer 1921 York Road, Timonium, MD 21093 410.252.4027, x103 | alison@acd1.com

J. Russell Boyce

Carole A. Maclure

Secretary RE/MAX 100 10665 Stanhaven Place White Plains MD 20695-3062 301.843.5100 russboyce@remax.net

Treasurer Pioneer Realty Inc. One Research Blvd., Suite 450 Rockville, MD 20854 Cell 301.648.1282 Fax 301.907.6610 maclure7@aol.com

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.

Cathy A. Werner Immediate Past President RE/MAX American Dream 9414 Belair Road Baltimore, MD 21236-1504 410.529.7900 Fax 410.529.7906 cwerner@remax.net

Mary C. Antoun 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

Maryland REALTOR® (USPS 0016-017) is published bimonthly by the Maryland Association of REALTORS®, 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 ®, 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.

M A R Y L A N D R E A L T O R ® December 2011/January 2012

5


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2012 Legislative Preview William Castelli

WE’RE

GOING BOAT

TO NEED A BIGGER One of the most memorable scenes from “Jaws” occurs when Police

Sustainable Growth and Septic Systems

Chief Brody sees the giant shark for the first time. His face turns pale

Last year, MAR along with other groups vigorously opposed legislation

and his cigarette dangles precariously from his lip as he backs up slowly

that would have prohibited septic systems in new major subdivisions.

into the boat’s cabin and says to the captain, “You’re going to need a

That legislation was never voted on. Instead, the Governor agreed to

bigger boat.”

form the “The Task Force on Sustainable Growth and Wastewater Disposal.” That group met regularly during the summer and fall and

REALTOR® lobbyists looking at the many policy challenges facing real

will finalize its recommendations in November and December. Among

estate in 2012 feel we, too, need a “bigger boat.” At the federal level,

the many recommendations that may result are further restrictions

Congress is debating changes to the Mortgage Interest Deduction and

and/or requirements for new and existing septic systems, means-testing

whether to continue support for a government role in secondary

for septic grants, and increased fees paid into the Bay Restoration Fund

mortgage market, while federal agencies are considering mandatory

to help pay for wastewater treatment plant upgrades and septic grants.

down payment requirements and implementing difficult condo and

MAR continues to oppose the prohibition of septic systems in new

HOA rules. Any one of these challenges alone would be significant.

subdivisions because of its harmful impact on growth and housing

Together they are frightening.

affordability.

But it doesn’t end there. At the state level, Maryland is considering

PlanMaryland

issues of growth control, real estate fees, lead paint, septic systems, and

While the Task Force on Sustainable Growth will have clear growth

foreclosures. The challenges circling the industry are many and exist

impacts, the State of Maryland -- through the Department of Planning

at all levels of government.

-- is expected to announce new development rules for counties to meet in order to receive state funding. Although PlanMaryland is intended

While your REALTOR® associations will be fighting hard to address all

to redirect growth, MAR is concerned that its effect will be to stop

of these issues, MAR will be focused intensely on the state legislative

growth in many areas. We have submitted formal comments advocating

challenges facing our industry. The following is a description of some

that local planning decisions remain with local governments rather

of the top issues we will be working on in the coming year.

than the state. Although many of PlanMaryland’s goals do not require legislation to be enacted, bills addressing PlanMaryland elements will likely be introduced this winter.

M A R Y L A N D R E A L T O R ® December 2011/January 2012

7


2011 Legislative Outlook

Continued from page 7

Taxes

passed by the General Assembly, as it gave everyone involved in real

First the good news: revenues picked up this past year, giving the state

estate sales clear information regarding the ownership status of the

some unanticipated funds. Now the bad news: the additional revenue

property. Proper titling and disclosure require some kind of mandatory

only reduces the fiscal hole for the coming year (to $750 million).

registration, and MAR will be seeking a solution.

While the federal government helped bail out the state in prior years, that well is now dry. Over the summer, legislators had briefings

Transfer Taxes on Foreclosed Properties

regarding the expansion of the state sales tax to certain services (real

As if real estate owned (REO) property wasn’t hard enough to sell, the

estate was not mentioned) as well as the issue of taxing internet sales.

government sponsored entities (GSEs) have taken the position that as

MAR expects a sales tax expansion bill to be introduced in the coming

quasi-governmental entities, they cannot be taxed when selling their

session. It is also clear that the Legislature will consider an increase

foreclosed property. County governments deal with this problem in

in the gasoline tax.

different ways. Some counties require the buyer of the GSE property to pay ALL of the transfer tax and recordation fees. Other counties

Lead Paint

require the buyer to pay only half of those charges and forgive the rest.

This summer, a great deal of time was spent deciding whether Maryland

MAR and the land title industry in Maryland will be seeking legislation

should place new lead paint requirements on home sellers. Among the

to require one rule: that buyers only pay half of these taxes rather than

ideas discussed are mandatory lead dust tests of all pre-1978 properties,

picking up the seller’s half as well. While state government may not

and mandating that an elevated blood lead level is recorded with the

be in a position to give incentives to foreclosure purchases, surely the

property records.

government can at least remove some of the barriers to moving these properties.

In addition to the work of this group, the Maryland Court of Appeals overthrew a portion of the current Maryland lead paint program for rental properties (see this month’s Legal Hotline article). Although the

With all of the policy challenges facing real estate, it is time for us to

Court permitted the registration part of the law to stand, it ruled that

search for the “bigger boat.” MAR’s President Pat Terrill has challenged

the liability cap for property owners violated the Maryland Declaration

Maryland REALTORS® to become more politically engaged and, as part

of Rights. Now property owners and property managers who have

of that, to respond in greater numbers to legislative calls-for-action

spent hundreds of millions of dollars in the last 15 years to make

(CFAs). Currently, about 14% of Maryland REALTORS® participate in

properties safe, face unlimited liability if a child registers a high blood

CFAs. CFAs take little time to respond to, but they pay back big

lead level while in their property. MAR and a number of groups will

dividends when legislators hear from voting constituents. And all of

be working with the Legislature this winter to address this

our CFAs direct REALTORS® to their own elected officials.

unsustainable liability. REALTORS® can have success on many of the current policy challenges

Ground Rents

facing us, but only if we build the “bigger boat,” and that starts with

The Court of Appeals poked the General Assembly in the eye again,

something as simple as picking up the phone or sending an email. Help

ruling another one of their legislative enactments unconstitutional.

us represent your interests.

This time the Court found that the law abolishing a ground rent that was not registered with the state an unconstitutional taking of property (see this month’s Legal Hotline article). As a result, there is now no penalty for failing to register a ground rent. The Ground Rent registry was one of the most important provisions of the ground rent reform

8

M A R Y L A N D R E A L T O R ® December 2011/January 2012

William Castelli, Esquire, Vice President, Legislative Affairs Maryland Association of REALTORS®


M A R Y L A N D R E A L T O R 速 December 2011/January 2012

9


Economic Forecast Anirban Basu

U.S. Economy

No Longer Deteriorating . . . For the most part, 2011 has been a disappointment. Coming into the year, the economy was reasonably flush with momentum. Nationally, the economy expanded 3.0 percent over last year, and financial markets rallied toward the end of the year. But high energy, food and other commodity prices, as well as the March earthquake in Japan had undermined much of the momentum and confidence that had accumulated late last year. The first half of 2011 was essentially a dud.

At Least for Now It Should be an Action-Packed 2012: 2 Stars ★★ 10

M A R Y L A N D R E A L T O R ® December 2011/January 2012


However, recent economic news has been more positive, with respect to

But the 2012 outlook remains unusually blurry in this country, and for the

gross domestic product, business investment and exports. If the U.S.

developed world. Despite recent progress in Europe regarding the

economy continues to progress, this will eventually translate into more

sovereign debt crisis related to Greece avoiding a referendum on a new

vigorous recovery for the state’s housing market, at least if mortgage rates

bailout package, investors and others will continue to be vulnerable to

remain well behaved.

headline risk – the risk that negative news coverage and uncertainty will cause a significant change in the value of an investment. The Italian and

It could be worse. Until recently, it seemed that the nation was doomed

Spanish debt levels are also responsible for fueling persistent uncertainty

for another downturn. During the first quarter, Gross Domestic Product

and risk in the markets.

(GDP) expanded at a meager 0.4 percent, followed by 1.3 percent growth in the second quarter. Job growth during the first half of the year was also

The situation in the U.S. is also somewhat precarious from a public policy

unimpressive and far too weak to trim unemployment rates. The nation’s

perspective, including at state and local levels, where many governments

official unemployment rate remained stuck at 9.1 percent for several

continue to wrestle with a host of fiscal challenges. As of this writing, the

months before ticking lower to 9.0 percent in October.

so-called Super Committee has announced it failed in its task of trimming federal spending by $1.2 trillion over the next ten years. The various

Financial markets began to surge in October and consumers continue to

impasses in Washington represent another source of uncertainty for

spend at surprisingly lofty levels despite extraordinarily weak income

prospective buyers, lenders and other stakeholders in the state’s residential

growth. The Bureau of Economic Analysis reported in its initial estimate

real estate market.

that the economy expanded at a 2.5 percent annualized rate during the third quarter. That is nearly three times the pace of economic expansion

Through it all, job growth has remained positive. Unfortunately, the soft

registered during the first six months of the year (0.9 percent on an

patch that infected the economy early in the year has had the effect of

annualized basis).

reducing the pace of employment expansion. Between February and April of 2011, the nation was averaging more than 200,000 net new jobs per

Exhibit 1. Change in Real Gross Domestic Product, Q3 2005 through Q3 2011

month based upon Bureau of Labor Statistics data. But by October, the pace of job growth had slowed dramatically, to just 80,000.

Job

growth is unlikely to pick up significantly over the next several months given a relative lack of small business confidence and the fact that many firms decided to slow hiring during the lull in economic activity earlier in 2011. Many state and local governments across the nation also continue to downsize in their effort to balance annual budgets without raising taxes substantially, if Source: Bureau of Economic Analysis

at all.

M A R Y L A N D R E A L T O R ® December 2011/January 2012

11


Economic Forecast

Continued from page 11

Job growth may pick up at some point in 2012, however, helping to spur

significantly since the mid-2000s, many of those who expected to stay in

more confidence and more real estate activity. There are a number of

New Jersey or Northern Virginia held on to their jobs. As a result, the

industries and segments that continue to drive growth, including energy/

affect on rental markets has arguably been greater than anticipated, but the

power, healthcare, consumer spending, exports and food. With the

impact on owner-occupancy in Maryland has been somewhat less. As time

possible exception of consumer spending, each of these segments is poised

passes and more of these jobholders either retire or make the commitment

for ongoing progress during the year ahead.

to Maryland, the expected impacts of base realignment will materialize. But for now, the effect has been

Exhibit 2. U .S. Nonfarm Employment Growth (12-month Absolute Change), October 2010 v. October 2011

partially muted. According to the Bureau of Labor Statistics, the state has added jobs at less than half the national rate over the past twelve months for which data are available. Take away job growth in professional and business services, much of which took place in terms of job growth is in the temporary help category, and given that, the actual job growth in the state would actually be negative.

Source: Bureau of Labor Statistics

While some may attribute this lack of job creation to the state’s business

Maryland: Arguably Even More Disappointing

climate, which has sometimes been described as challenging, there are

This was supposed to be a fine year for job creation in Maryland. With the

clearly other issues. For instance, job growth in Virginia has also decelerated

nation adding jobs and with base realignment finally implemented in full,

in recent months even though the Commonwealth is widely regarded as

many economists in Maryland thought that the Free State could add

sustaining one of the nation’s most competitive business climates.

25,000-30,000 jobs this year. But with the U.S. economy’s performance disappointing, with base realignment-related multiplier effects being more

Unemployment in Maryland has generally been increasing. Even

subdued than initially projected, and with federal agency heads hoarding

Montgomery and Howard counties now suffer unemployment rates that

cash due to lingering budgetary uncertainty, the Free State has failed to add

have been edging toward 6 percent. As of this writing, the state’s

nearly as many jobs as anticipated.

unemployment rate stands at 7.4 percent, the highpoint for the year. The Eastern Shore dominates the list of jurisdictions suffering the state’s

One of the reasons that base realignment hasn’t had its anticipated impact

highest rates of unemployment, though the single-highest unemployment

thus far is that many of those whose jobs were relocated to Maryland

rate is attached to Baltimore City.

remain at least partially attached to places like New Jersey and Northern When base realignment recommendations were initially

Job growth in both the Baltimore and Washington metropolitan areas has

promulgated and subsequently adopted, surveys indicated that many of

slowed over the past year. This is particularly true in the Washington

those whose jobs had been relocated would surrender those jobs in favor of

area, which is more vulnerable to federal budgetary gyrations than even

other opportunities closer to home. But with the economy deteriorating

government-rich Baltimore.

Virginia.

12

M A R Y L A N D R E A L T O R ® December 2011/January 2012


income growth virtually each

Exhibit 3. U nemployment Rates by Maryland Jurisdiction, NSA, September 2011 Rank

Jurisdiction

Rate

Rank

Jurisdiction

month.

That could result in

another soft patch in economic

Rate

activity early next year.

1

Howard County

5.4

12

Talbot County

7.3

2

Montgomery County

5.5

14

Kent County

7.4

3

Calvert County

6.0

15

Baltimore County

7.8

Our outlook for Maryland has also

3

Charles County

6.0

16

Cecil County

8.2

improved somewhat. Data from

5

Saint Mary's County

6.1

17

Allegany County

8.4

6

Carroll County

6.2

18

Wicomico County

8.5

6

Frederick County

6.2

19

Caroline County

8.8

8

Queen Anne’s County

6.4

19

Worcester County

8.8

8

Garrett County

6.4

21

Somerset County

9.0

through the local economy. With

10

Anne Arundel County

6.6

22

Washington County

9.6

that in the rear-view mirror,

11

Harford County

7.1

23

Dorchester County

10.0

economic activity appears to have

12

Prince George's County

7.3

24

Baltimore City

10.4

been stabilizing of late.

the summer were skewed by the nation’s debt ceiling debacle, which slowed the flow of federal funds

Source: Bureau of Labor Statistics

Looking Ahead

Unfortunately, more drama is likely in Washington, D.C. This is

Our outlook has improved marginally over the past three months.

particularly true as the stakes get higher as we approach November

There was an underlying momentum in the U.S. economy that

2012. Consequently, next year could be another roller coaster ride

existed coming into 2011, which was buried by a tidal wave of bad

for the Maryland economy and by implication for the housing

news and rising input prices earlier this year. The ongoing malaise

market.

of the housing market has not helped. But for now, the economic momentum seen in the first part of 2011 is becoming apparent again, with economic growth during the second half of 2011 poised to be more than twice as fast as the first.

Much will depend upon the

Exhibit 4. Maryland Jurisdiction Months of Inventory, October 2010 - October 2011 Jurisdiction

Months of Inventory

Jurisdiction

Months of Inventory

2010

2011

2010

2011

Montgomery

5.3

5.1

Baltimore City

15.6

13.1

Frederick

8.2

6.1

Queen Anne's

19.9

15.0

Prince George's

8.5

6.3

Wicomico

16.4

16.4

consumer’s willingness to continue

Howard

6.8

6.7

Dorchester

18.9

17.1

spending. The U.S. savings rate

Charles

8.5

6.8

Allegany

12.4

19.4

now stands at 3.6 percent, its

Baltimore County

12.1

8.5

Cecil

16.2

19.5

lowest level since December 2007, the first month of the recession.

Anne Arundel

9.8

8.8

Talbot

29.0

22.0

Washington

12.8

9.2

Kent

31.0

22.4

10.2

Worcester

20.1

22.5

Harford

9.2

We are concerned that consumers

Carroll

11.5

10.3

Garrett

21.5

22.8

are presently overspending their

St. Mary's

9.2

11.5

Caroline

17.1

25.4

Calvert

16.6

12.2

Somerset

15.3

26.0

capacity, with spending growth exceeding the pace of personal

Source: Maryland Association of Realtors (MAR), Sage; based on October sales volumes

M A R Y L A N D R E A L T O R ® December 2011/January 2012

13


Economic Forecast

Continued from page 13

year are all on the Eastern Shore. However, prices continue to

Exhibit 5. M edian Housing Prices, by Jurisdiction, October, 2011 and 2010 Jurisdiction

2011

2010

slide in many of the state’s larger jurisdictions, including in Baltimore City, Baltimore County, Anne Arundel County and

% Chg.

Prince George’s County.

1

Kent

$204,500

$169,000

21.0%

2

Washington

$168,000

$145,000

15.9%

3

Somerset

$100,100

$88,750

12.8%

4

Wicomico

$145,000

$133,500

8.6%

5

Allegany

$95,900

$90,500

6.0%

year earlier. This represents an increase in pending sales of 21

6

Queen Anne's

$269,000

$259,000

3.9%

percent. The active inventory of unsold homes has fallen from

That said, there are indications of progress. Pending sales statewide totaled 5,441 in October 2011, up from 4,506 one

7

Calvert

$255,000

$249,950

2.0%

40,302 to 34,277 over the past year, a decline of almost

8

Frederick

$252,500

$250,000

1.0%

precisely 15 percent.

9

Carroll

$241,925

$240,000

0.8%

10

Caroline

$144,500

$146,000

-1.0%

11

Harford

$225,000

$237,500

-5.3%

12

Baltimore City

$83,000

$88,500

-6.2%

13

Montgomery

$327,250

$350,000

-6.5%

support both the first-time and move-up buyer markets. Second,

14

Howard

$330,750

$354,500

-6.7%

asset prices must continue to rise, including equity prices. Better

15

St. Mary's

$280,210

$302,450

-7.4%

stock market performance would both boost confidence among

16

Baltimore Co.

$195,000

$212,000

-8.0%

prospective buyers and would also create greater resources available

17

Charles

$210,000

$228,475

-8.1%

18

Anne Arundel

$275,000

$299,900

-8.3%

19

Garrett

$263,000

$330,000

-20.3%

20

Pr. George's

$150,000

$190,000

-21.1%

21

Cecil

$169,900

$216,500

-21.5%

22

Worcester

$205,000

$270,000

-24.1%

Foreclosures may continue to be a major headwind for the housing

23

Talbot

$222,450

$322,095

-30.9%

market, impacting both sales prices and confidence. However, even

24

Dorchester

$74,094

$164,950

-55.1%

along this dimension there has been good news. In Maryland, just

Source: Maryland Association of Realtors (MAR), Sage; based on October sales volumes

For the pace of recovery to accelerate, a few things must occur. First, job growth must accelerate significantly. This will help

for down payments. Finally, lending conditions and appraised values must stabilize to enable a larger share of prospective buyers to qualify for mortgages.

one in every 1,954 housing units received a foreclosure filing in

Indeed, we expect that Maryland’s housing market will continue to

October, for a total of 1,198 units. The national figure for October

struggle for the most part next year. Though Montgomery and

was one in every 563, according to RealtyTrac. If the pace of foreclosures

Howard counties have now reached supply-demand equilibrium or

continues to soften, price stability or better may ensue more quickly than

are at least on the verge of doing so, much of the state remains

presently anticipated, stimulating a sense of urgency among buyers that

associated with eight months of housing supply or more. Median

hasn’t been apparent for at least four years.

and average sales prices continue to decline, including in October, the last month for which data are available. The four jurisdictions suffering the largest declines in median sales prices over the past

14

M A R Y L A N D R E A L T O R ® December 2011/January 2012

Anirban Basu, Sage Policy Group, Inc.


Designation Programs

REALTOR® Family

Designation Programs Workforce Housing Designation This certification program offers training to members who want to learn more about financing options for first-time homebuyers and critical workforce employees (police, firefighters, teachers, medical staff) as well as programs targeted for special populations, such as disabled persons and aging citizens. Currently, this designation is for Maryland REALTORS® only and not a NAR designation. The National Association of REALTORS® has affiliated Institutes, Societies, and Councils that provide a wide-ranging menu of programs and services that assist members in increasing skills, productivity and knowledge. Designations acknowledging experience and expertise in various real estate sectors are awarded by each affiliated group upon completion of required courses. In addition, NAR offers two certification programs to its members.

ABR – Accredited Buyer Representative

ALC – Accredited Land Consultant

With over 40,000 members, REBAC is the

ALCs are the recognized experts in land brokerage

largest association of real estate professionals

transactions of five specialized types: (1) farms and

focusing

buyer

ranches; (2) undeveloped tracts of land; (3) transitional and

representation. Over 30,000 ABR® designees

on

all

aspects

of

development land; (4) subdivision and wholesaling of lots;

have completed the REBAC course, passed

and (5) site selection and assemblage of land parcels.

the test, and provided documentation of

Acquire valuable skills through educational offerings

buyer agency experience. REBAC (Real Estate Buyer’s Agent Council) Visit www.rebac.net

ABRM – Accredited Buyer Representative Manager

leading to the ALC designation. REALTORS® Land Institute (RLI) For information visit www.rliland.com

CCIM – Certified Commercial Investment Member®

Geared to real estate firm brokers,

CCIMs are recognized experts in commercial real

owners and managers that have or wish

estate brokerage, leasing, valuation, and investment

to incorporate buyer representation into

analysis. The CCIM business network includes more

their daily practice. Designees have

than 7,500 designees and an equal number of

taken and passed both the ABR® and ABRMSM course and provided documentation of past management experience. REBAC (Real Estate Buyer’s Agent Council) Visit www.rebac.net

candidates principally in North America, but also in Asia and Europe. CCIMs are backed by a respected education program, as well as superior technology products and business resources. CCIM Institute Visit www.ccim.com M A R Y L A N D R E A L T O R ® December 2011/January 2012

15


Designation Programs

Continued from page 15

CIPS – Certified International Property Specialist

CRS® – Certified Residential Specialist®

The CIPS network is comprised of 1,500 real

Agents can maximize their potential by earning the

estate professionals from 50 countries who

CRS® designation and joining the organization that

deal in all types of real estate, but with one

has served top-producing residential sales agents since

common element: they are focused

1977. The more than 35,000 CRS® designees benefit

specifically on the “international” market.

from nationwide referral opportunities, a professional

Whether traveling abroad to put deals together, assisting foreign investors,

image that attracts customers, and sales and marketing support. The CRS®

helping local buyers invest abroad, or serving an immigrant niche in local

designation is awarded to experienced REALTORS ® who complete

markets, CIPS designees are consumers’ best resource to ensure they are

advanced training in listing and selling, and meet rigorous production

dealing with a professional skilled in the unique aspects of international

requirements.

real estate. National Association of REALTORS Visit www.realtor.org/cipshome.nsf/pages/education ®

Council of Residential Specialists Visit www.crs.com

CRE – Counselor of Real Estate CPM – Certified Property Manager

®

The Counselor of Real Estate — or CRE — is a Acquire valuable real estate management skills through

member of The Counselors of Real Estate, an

educational offerings leading to the CPM designation.

international group of recognized professionals

CPM® members have the competitive edge in every area

who provide seasoned, objective advice on real

of real estate management from residential to

property and land-related matters. Only 1,100 practitioners throughout

commercial to industrial.

the world carry the CRE designation. Membership is by invitation only.

®

Institute of Real Estate Management (IREM) Visit www.irem.org

CRB – Certified Real Estate Brokerage Manager

GAA – General Accredited Appraiser

The Certified Real Estate Brokerage Manager (CRB)

Certified general appraisers wishing to

designation is recognized industry-wide as the

increase their visibility should consider

measure of success in brokerage and real estate

pursuing the GAA designation. The GAA

business management. The designation is awarded by

designation is awarded to appraisers

the Council of Real Estate Brokerage Managers to

whose education and experience exceed

REALTORS who have completed the Council’s

state appraisal certification requirements

advanced educational and professional requirements.

and is supported by the National

®

CRB designees consistently increase their level of industry knowledge, advance their earning and career potential, increase their firm’s profitability and benefit from active involvement in our network of real estate professionals. The new CRB Designation Program now provides credit for management experience, higher education and previously earned NAR designations. Additional credits can be earned through the Council’s management education programs delivered live or by Self Study on CD-ROM. Council of Real Estate Brokerage Managers For more information visit www.crb.com

16

Counselors of Real Estate Visit www.cre.org

M A R Y L A N D R E A L T O R ® December 2011/January 2012

Association of REALTORS®. National Association of REALTORS® Visit www.realtor.org/appraisal/appraisal/designationinformation


GREEN – NAR’s Green Designation

RCE – REALTOR® Association Certified Executive

The Green REsource Council serves real

Association

estate

providing

demonstrating commitment to the field of

comprehensive training and access to

REALTOR® association management should

cutting-edge resources and tools as well as

pursue the RCE designation. AEs are

professionals

by

promoting green excellence, leadership, and consumer awareness within and across multiple real estate disciplines. Practitioners who complete the 3-day program are awarded NAR’s Green Designation, the only green training program recognized by the NAR. The Green REsource Council For information visit www.GreenREsourceCouncil.org

in

knowledge and their association achievements and experience. National Association of REALTORS® More information can be found at www.realtor.org/RCEonline.nsf/pages/rcehomepg

RAA – Residential Accredited Appraiser Certified residential appraisers wishing to increase their visibility should consider

Members involved in residential real estate

pursuing the RAA designation. The RAA

who want a solid base of information for

designation is awarded to appraisers whose

their practice will want to participate in the

education and experience exceed state

REALTOR® Institute program and earn the

National Association of REALTORS® NAR maintains a clearinghouse of information for individuals interested in the GRI program. For more information, contact MAR at 800.638.6425 or visit www.mdrealtor.org

interested

recognized for their specialized industry

GRI – Graduate REALTOR® Institute

GRI designation.

executives

appraisal certification requirements and is supported by the National Association of REALTORS®. National Association of REALTORS® Visit www.realtor.org/appraisal/appraisal/designationinformation

SRES® – Seniors Real Estate Specialist

PMN – Performance Management Network The SRES® Designation program educates The Performance Manage-

REALTORS® to profitably and ethically serve

ment Network (PMN) is a

the real estate needs of the fastest growing

new REALTOR® designation

market in real estate, clients age 50+. By

that’s built from the ground up to bring you the real-world skills, the

earning the SRES designation you gain access

know-how and the tools that will keep your business out front and on top

to valuable member benefits, useful resources,

of a lightning-fast market. This designation is unique to the REALTOR®

and networking opportunities across North America and Canada to help

family designations, focusing on the idea that in order to enhance your

you in your business.

business, you must enhance yourself. The curriculum is driven by the following topics: negotiating strategies and tactics, networking and refer-

Seniors Real Estate Specialist Council For information visit www.seniorsrealestate.com

rals, business planning and systems, personal performance management and cultural differences in buying and selling. Women’s Council of REALTORS® Visit www.wcr.org

M A R Y L A N D R E A L T O R ® December 2011/January 2012

17


Designation Programs

Continued from page 17

SIOR – Society of Industrial and Office REALTORS®

e-PRO®

Individuals certified with the SIOR

The new e-PRO certification provides a

designation are top producers in

roadmap to help you serve hyper-connected

industrial and office real estate

consumers of today and tomorrow. Course topics for Day 1 include the changing

brokerage. SIOR’s network includes

market, how to connect with consumers,

more than 2,800 members in 480 cities in 20 countries on six continents. The Society’s mandatory recertification requirement assures clients of the designee’s excellence in the fast changing commercial brokerage field. Society of Industrial and Office REALTORS® Visit www.sior.com

NAR Family Certifications

the online conversation, and reputation management. Day 2 provides hands-on discovery of business tech tools, such as an e-strategy, mobile office, micro-blogging, rich media, and NAR resources. Presented by REBAC (Real Estate Buyer’s Agent Council) Contact e-PRO® at epro@realtors.org, 877/397-3132 or http://rebac.net/e-pro.cfm

RSPS - Resort & Second-Home Markets Certification

AHWD® – At Home with Diversity

The RSPS is a certification offered by NAR Resort for resort & second-home REALTORS®

A ground-breaking professional education

around the world. REALTORS® specializing in

initiative designed to provide America’s real

resort and second-home markets and interested

estate professionals with training and tools to

in demonstrating their knowledge and

expand their business as well as homeownership

expertise should pursue the RSPS certification. The RSPS core certification

opportunities for more Americans.

requirements include the NAR Resort & Second-Home Market Course and the RLI Tax-Deferred (1031) Exchange Course. RSPS applicants will

AHWD certification relays to the public that those certified have been

also choose from nine different elective choices including courses from

professionally trained in and are sensitive to a wide range of cultural issues

the NAR Education Matrix and the NAR Resort Symposium held every

inviting a wider volume of business from a greater variety of cultures.

18 months.

For more information on this course and its business principles, please visit www.realtor.org/divweb.nsf

For more information, visit www.realtor.org/resort

SFR - Short Sales and Forclosures Resource BPOR – Broker Price Opinion Resource REALTORS® with the SFR certification can With the changing real estate landscape and the increased use of broker price opinions (BPOs) by market participants, the BPOR certification provides REALTORS® with knowledge and skills to reduce risk, increase opportunities and create professional BPOs. For information call 855-640-8863 or visit www.bpor.org

be a trusted resource for short sales and foreclosures. Your ability to close short sales and foreclosures depends in part on your confidence in seeing these transactions through. Begin building your confidence today with SFR!

National Association of REALTORS® For information visit www.realtorSFR.org

18

M A R Y L A N D R E A L T O R ® December 2011/January 2012


FREE Webinar Thursday Series USABLE STRATEGIES that will increase your confidence and immediately help you. Join us for our 2012 FREE Webinar Series designed for REALTORS® in every stage of the profession.

Matthew Ferrara

PA

R A IN B Social Media E Super Tips W T 4, 2011, 10 a.m. S November

Greg Herder— Hobbs Herder Getting Your Listings to Sell in Any Market December 15, 2011, 10 a.m.

Chris Bird

Aaron Rice

Taxes—Becoming an LLC, Sole Proprietor

Navigating Short Sales Successfully

January 12, 2012, 10 a.m.

February 2, 2012, 10 a.m.

Pat Hiban

Tom Ferry

6 Steps to 7 Figures

Agent Survival/Building Your Business Through Lead Generation

March 1, 2012, 10 a.m.

March 8, 2012, 10 a.m.

Legal Team

Steve Harney

Solving the Mysteries of the MAR Contract

Keeping Current Matters

Chuck Kasky/Colette Massengale

May 3, 2012, 10 a.m.

June 7, 2012, 10 a.m.

We will send a sequence of reminders to register. If you’re not receiving them, and don’t want to miss these valuable FREE Webinars, let us know at info@mdrealtor.org. M A R Y L A N D R E A LT O R ®

December 2011/January 2012

19


3

3

GREAT THINGS come in

1 2 3

20

Earn the GRI:

s

Increase Income Potential

REALTORS® with designations earn more income than those without designations. The GRI is a way to set you apart from the competition.

Broker’s License Requirement

The full GRI classroom series (100, 200, 300, and 400) fulfills the educational requirements needed to take the Maryland broker’s exam (MAR coursework is specific for Maryland).

The Name Says it All

As a GRI (Graduate, REALTOR® Institute), you have accomplished a high level of achievement which indicates to your clients and colleagues an increased skill level, industry knowledge and dedication to your profession.

M A R Y L A N D R E A L T O R ® December 2011/January 2012

GRI 2012 Schedule SERIES 100 Prince George’s Association 301-306-7900 March 3, 9, 15, 19 & 21, 2012

SERIES 200 MAR, Annapolis 800-638-6425 February 21, 28 March 6, 13 & 20, 2012 Pen-Mar Regional Association (Register through Hagerstown Community College) 301-790-2800 ex.520 April 12, 19, 26 May 3 & 10, 2012 Prince George’s Association 301-306-7900 June 6, 8, 14, 18 & 21, 2012 Greater Baltimore Board 410-337-7200 August 2, 9, 16, 23 & 30, 2012

SERIES 300 Greater Baltimore Board 410-337-7200 February 2, 9, 16, 23 March 1, 2012 Southern Maryland Association 301-870-2323 February 17, 24 March 2, 9, & 16, 2012 Prince George’s Association 301-306-7900 October 3, 10, 15, 18 & 24, 2012

SERIES 400 MAR, Annapolis 800-638-6425 May 1, 8, 15, 22 & 29, 2012 Greater Baltimore Board 410-337-7200 October 2, 9, 16, 23 & 30, 2012 Please visit the MAR website, www.mdrealtor.org for the most current course schedules.


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M A R Y L A N D R E A L T O R ® December 2011/January 2012

21


Realtors Property Resource, LLC

Launches Broker Tool Sets AD

On October 19, 2011 RPR launched an array of high value tools created specifically to support real estate firms and meet the unique needs of broker and managers. The Broker(s) Tool Sets (BTS) leverage RPR’s database of property information and report capabilities, helping brokers provide valuable services to their agents which work in tandem with broker’s existing technologies and promote their branding.

22

M A R Y L A N D R E A L T O R ® December 2011/January 2012


The BTS contains four distinct elements, two of which, Company

Chart Service:

Branding and Affiliated Service Modules appear to the agents on the

display select chart imagery from RPR direct on your own web pages

RPR website and reports, while other elements such as the Chart

and reports, or internal company marketing resources. An easy to use

Service and Data Tool are for Brokers, managers and authorized staff

token allows manipulation of the chart results based upon twelve

access only. The Broker Tool Sets include the following components:

select criteria and defined geographies by zip code.

Company Branding: Allows brokers to add their company

Data Tool: Analyze and visualize RPR data using a reporting and

logo via the RPR website and RPR Branded Reports.

querying tool designed specifically and exclusively for company staff

The Chart Service allows your company to

and managers. Download market trends in a variety of segments, and

Affiliated Service Modules:

Service Modules are

evaluate company and office performance against market performance.

promotional widgets that highlight a company’s business services to its

RPR Data Tool allows custom defined geographies which will cross

agents via the RPR website and RPR Branded Reports. Each service

MLS boundaries and give companies a view of the entire market area.

module can include a logo, contact information for the servicing agent

RPR also has a dynamic de-duplication tool which allows a high level

and a brief description. Service modules include:

of statistical accuracy for those companies where properties are listed in multiple MLSs.

Mortgage: This module allows you, at your option, to • display current and historical mortgage rates and provide links

To Register your company or to contact the RPR Broker Services Team

to get more information. A custom portal controls a mortgage

for more information go to blog.narrpr.com/broker

rate upload tool, so you can load the appropriate information.

• T itle,

Home Warranty, Insurance and Concierge

Jeff Young, Senior Vice-President of Operations Realtors Property Resource, LLC

RPR has also created a set of broker resources which can be accessed through its new re-designed blog at blog.narrpr.com/broker The Broker/Manager resource Center offers three specific areas of support: • L ive manager specific training classes covering areas of RPR such as an overview of how RPR can create value for your agents and companies, an explanation of the Broker Tool Sets, and dedicated classes to help you utilize manager-only tools such as the RPR Chart Service and Data Tool. They also offer archived videos of each class for download and viewing at your convenience. • P re-designed communications pieces to promote your company’s registration and involvement with RPR Broker Tool Sets, specific RPR features which can enhance

your agents’ efficiency, training opportunities for agents, and valuable tips to save time and money. • Sales Meeting Modules allow brokers and managers to utilize the Resource Center for a week-by-week pre-recorded video and supporting print material for use in company sales meetings. Short but incisive videos will help you guide your agents on how to gain market advantage by using RPR advanced features such as search, reporting, mapping, valuation tools and more.

M A R Y L A N D R E A L T O R ® December 2011/January 2012

23


Maryland Real Estate Commission News Katherine Connelly

Paperless Licensing

Announced

In an effort to improve service and conserve operating funds, the Maryland

password to update your email address. PLEASE remember to keep this

Real Estate Commission is pleased to announce that the electronic license

updated regularly.

renewal process will now culminate with license certificates and pocket cards that can be downloaded by a broker on his computer. We will be fine

Once the Commission has a current email address, the brokers will receive

tuning this in the very near future so that branch office managers may

an email notice advising that a license is ready to be downloaded. The broker

receive the notification from the Commission. In the interim, the broker

will be able to print the new license and pocket card, provide a paper license

can save the licenses and email them to branch office managers.

to the licensee and save a digital copy for safekeeping. We suggest saving a copy of the license by expiration date, either in paper or digital form, to track

Effective December 1, the Commission will no longer issue and mail paper

when licensees affiliated with the brokerage are due for renewal.

licenses to individuals. Brokers will be sent an email stating that a licensee with that broker has applied, renewed, upgraded or amended his or her real

Each new license will be available to download from the Commission’s

estate license. The email will inform the broker that the new license is

website for 60 days. Thereafter, if a duplicate license from the Commission

ready to be printed, and direct the broker to a secure website for access to the

is needed, a request to us by email will be sufficient at mrec@dllr.state.md.us

digital license. We very much hope that paperless licensing is a service enhancement that As brokers will be the point of contact for distribution of the real estate

the industry will find useful. The Commission may elect to continue

licenses, it is very important that they ensure that the Commission has a

sending paper licenses for a brief transition period while we make sure that

current email address for sending notifications. The Commission has been

the new system is working properly. However, brokers should be prepared to

notified that several brokers declared our email notice to them as spam and

print and distribute licenses for their affiliated agents and associate brokers

“Opted Out.” We request that these brokers reverse this action as there will

beginning in December.

be no other form of notification other than email . Please let us know how the new system is working and if you have To update an email address on file with the Commission, go to

suggestions for how the Commission can improve our service in the

www.dllr.state.md.us and click on “Occupational and Professional

future. If you have any questions, please feel free to contact me at

Licensing” which appears on the left side of the webpage. Then click on

kconnelly@dllr.state.md.us.

“Real Estate Commission” on the right side of the page. At the top of the Real Estate Commission page, select “industry” and then find the “update personal information” button. Use your existing login ID and

24

M A R Y L A N D R E A L T O R ® December 2011/January 2012

Katherine Connelly is the Executive Director of the Maryland Real Estate Commission For more informaion, visit http://www.dllr.state.md.us/license/mrec


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25


Regulation News Mark Feinroth, Esquire

Real Estate Commission

Wins Big in Maryland High Court

Maryland’s highest court of appeals has

The Real Estate Commission filed its disciplinary action against the

upheld the Real Estate Commission’s decision

broker in early February, 2007, alleging that, having been convicted of a

to revoke the license of a broker convicted of sex abuse with a minor and child abuse by a

felony and engaging in conduct demonstrating bad faith, incompetency or untrustworthiness, the broker was subject to reprimand, penalties, license suspension and or revocation.

parent. (To protect the privacy of the children involved in this case, we will not name the licensee because the victims in the criminal case were his daughter and niece.)

At the Office of Administrative Hearings, the licensee presented evidence of his participation in a recovery program as well as therapy and counseling sessions with a clinical social worker and psychotherapist. Counsel argued on his behalf that his real estate practice was never affected by the crimes he committed or the therapy he then was receiving. On behalf of

On January 29, 2007, the broker pleaded guilty to felony sex abuse and was sentenced to four years in jail with three years suspended. Four months of the remaining year of jail were to be served in the County Detention Center and the remaining eight months on house arrest.

the Real Estate Commission, the Attorney General’s office argued that the licensee’s sentence placed him on probation for five years, and one of the terms of that probation was that he not have unsupervised encounters with children. The abuse of his niece occurred over a fifteen year period and, at the time of the hearing, it had been less than two years since his

At the time, the Commission lacked authority to immediately suspend his real estate license. Further, the Commission had no choice but to allow the broker to renew his license and subsequently to exchange his broker license for that of a salesperson.

guilty plea. Moreover, the Attorney General also pointed out that a licensed real estate broker or agent normally has access to private homes and to residents of those homes. It was reasonable for the Real Estate Commission to take an especially close look at this licensee and consider whether sufficient time had passed to have confidence in his

The Commission successfully sought additional authority to address this type of problem in the future from the 2008 General Assembly.

26

M A R Y L A N D R E A L T O R ® December 2011/January 2012

trustworthiness.


The Administrative Law Judge recommended a six month license

to notify the Commission about a felony conviction. The Commission is

suspension to allow for additional treatment and therapy prior to the

authorized to immediately suspend the individual’s real estate license

licensee’s resumption of real estate activities. The Commission disagreed

based on the felony conviction. The licensee is entitled to a hearing as to

with the Judge’s recommendation and ordered a license revocation. The

whether the license suspension should be continued.

licensee requested an exception hearing before the Commission and appealed to the Circuit Court. When the Circuit Court upheld the

While this case took five years to reach its conclusion, we can all

Commission’s decision, he appealed to Court of Special Appeals and then

feel more confident that real estate licensees are subject to close

to the Court of Appeals.

supervision by the Real Estate Commission when the licensee’s conduct poses a threat to the public.

Please feel free to contact me at

From the time of his guilty plea in January 2007 to the Court of Appeals

mark.feinroth@mdrealtor.org if you have questions regarding this case

ruling on October 28, 2011, the licensee held a valid Maryland real estate

or any other matter related to the Real Estate Commission.

license. Mark Feinroth, Esquire, Director of Legal and Regulatory Affairs As part of the expanded legislative authority the General Assembly passed

Maryland Association of REALTORS®

in 2008, based on this particular licensee’s case, licensees are now required

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M A R Y L A N D R E A L T O R ® December 2011/January 2012

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This valuable and timely bi-weekly e-news blast is exclusively for MAR members. Don’t miss out on Contract changes, Legislative news, Educational offerings, and reminders of benefits. Contact info@mdrealtor.org and register. Also, visit Maryland Association of REALTORS® Facebook page to keep you up-to-date.

MAR and Sam’s Club Have Teamed Up MAR and Sam’s Club have teamed up offering a $10 gift card when you join or renew your membership. Visit

sources that provide information and ideas on marketing and technology to help you improve your business. Delivered directly to you by electronic mail twice per month, The REALTOR ® Toolkit focuses on productivity solutions dealing with communication tools, Web-based technology, effective marketing techniques, success stories and more. Send your subscription request to

info@mdrealtor.org or to review past issues go to http://www.mdrealtor.org/Publications/REALTORToolKit

www.mdrealtor.org and go to member benefits. Download the certificate and take it to any Sam’s Club in Maryland.

FREE Webinar

Thursday Series

• Usable Strategies • I ncrease Your Confidence In Every Stage of the Profession! 28

M A R Y L A N D R E A L T O R ® December 2011/January 2012

pg 19


It’s time to RISE. And shine. Prosper. Profit. Grow. And love every minute of it.

HopeRises Realty needs you. We’re new (but not for long!). We’re hungry. And we’re looking for passionate REALTOR® agents—whether newly licensed or well-connected veterans—to join our team. We seek independent spirits throughout Maryland who value their profession and are eager to build their value. As part of HopeRises Realty, you’ll have a say as we grow. And you’ll grow because you’ll have a say. Most importantly, you’ll discover, or rediscover, enthusiasm and fulfillment that makes you want to get up in the morning. It’s time to RISE. And shine. Build wealth • Increase transaction volume • Competitive commissions • Local knowledge • Tech savvy network • Licensed in MD • Coming soon DC, VA, DE, PA • In-house legal counsel • Convenient Ellicott City office

www.HopeRises.com Call Nate Titman at 410-480-7555

M A R Y L A N D R E A L T O R ® December 2011/January 2012

29


Metropolitan Regional Information Systems, Inc.

Top 11 Core Enhancements of 2011: A Look Inside the MRIS Innovation Lab What an exciting year 2011 has been and we have you to thank for it! MRIS receives hundreds of customer suggestions a month and this feedback helps drive our product innovation efforts throughout the year. We take the most requested items and build our product roadmaps around that input. Here are the Top 11 Core Product Enhancements you asked for in 2011 and MRIS delivered. All are included in your subscription fee, so make sure you are taking advantage of these products, services and technology tools to enhance your business:

1. MRIS.com email storage was increased from 200MB to 2GB 2. ezJoin which simplified the online registration process to save you time

3. Matrix upgrades including auto-email updates, multiple carts, price option for 1,000s and View As

4. Media Connect to quickly and easily upload multiple photos to your listings from a PC or MAC

5. Compliance notifications are now sent via email so that you don’t miss any important correspondence

6. Media Connect upgrade offering spell check and photo enhancement 7. Keystone enhancements with geocoding for more precise property mapping

9. mrisTV.com your on-demand video portal, it’s all real estate, all the time

10. HomesDatabase.com enhancements offer consumers new ways to search for a home and connect with you

11. MRIS.com email mobile portal now accessible for email on the go (mail.mris.mobile) We love to hear what you need from MRIS and the ideas you have to enhance our products and services, so keep the suggestions coming! MRIS offers a variety of ways for you to share your feedback including: • Comment at MRISBlog.com • Share ideas at Facebook.com/MRISonFB • Send an email to: Suggest@mris.net • Speak with a Client Alliance Manager (CAM) • Stop by our booth at events • Participate in a focus group • Act as a product beta tester • Complete our surveys • Watch videos and leave us a comment at mrisTV.com And we aren’t finished; we are hard at work on some exciting new initiatives including a mobile smartphone app, upgrading Web Settlement Xpress, building a new and improved Keystone and many other enhancements that will improve the way you do business. Thanks again for all of the fantastic ideas and comments. Keep them coming. Your input does make a difference. MRIS is looking forward to helping you achieve a very successful 2012.

8. MRIS-U training portal allows you to search and register for MRIS classes and access training materials

30

M A R Y L A N D R E A L T O R ® December 2011/January 2012

For more information, go to www.mris.com



Oilheat . Know more, sell more. Do you have all the

answers?

It’s never been easier…

1. How many homes in Maryland use oilheat? 2. Is a home’s value lessened because it uses heating oil?

3. How much cleaner do today’s oilheat systems burn than those from 1970?

4. Is it normal to smell oil in a home that uses oilheat?

5. Are leaking oil tanks a problem for homes in Maryland? (See answers below.)

AD

Just listed — the warmest home on the block! Because oil generates more Btu’s

Answers:

of heat and warms a home more evenly than any other fuel, it’s not a stretch to

1. About 300,000 2. No. The type of fuel used has a minimal effect on value, but a system’s age and efficiency generally does.

Want the facts? /Jan. Dec. 2010

2011:

eal Close the 1D01” (page 14) t a “Oilhe

describe the next oil-heated home you show as being among the warmest on the block. You could say that oilheat is the ultimate comfort fuel! You can also tell your clients that today’s oil heating systems are much more reliable, efficient and cleaner burning than the one they may remember at their grandparents’ house. And you may be able to close the deal by talking about service. Clients who do business with a reputable oil dealer can expect to get fast personal service. Because keeping your family warm is not only their business; it’s their top priority.

3. 95% cleaner 4. No. A properly

residential storage tanks are not regulated by the U.S. government.

● Text 551-556-0224. ● Email sjanett@oilheatpros.com. ● Go to www.md.oilheatpros.com. ● Facebook Susan Janett.

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Want to connect?

Check out these issues…

Straight talk about heating costs (page 29)

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5. No. Leaks are so rare that

functioning system will not emit an odor.

April/May 2011:

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Commercial Connection Bill Armstrong

Bill Armstrong on

Commercial Lending and “Skin in the Game” You may have heard about a new rule called Qualified Commercial Real Estate Loan exemption standards, or QCRE, for short. QCRE is a rule developed by federal regulatory agencies as part of the DoddFrank Financial Reform Law. If implemented, this rule could have devastating effects on the commercial industry.

inspiring confidence, it could just make a fragile market worse. You

QCRE tries to ensure that lenders have “skin in the game” by holding

That’s a lot of unnecessary requirements to meet! Even if there were

them responsible for 5 percent of any commercial real estate loan that

only two or three requirements to meet, approximately 98 percent of

is packaged or pooled into a commercial mortgage-backed security,

commercial loans still would not qualify.

see, the only way lenders can get out of putting down 5 percent is if over 30 criteria are met, including a 65 percent loan to value ratio and debt service coverage ratio of 1.7. QCRE is the commercial counterpart to QRM, and it will be just as damaging to the real estate business. In other words, if the loan did not meet the debt service coverage ratio requirement of 1.7 and a 65% LTV, the lender would have to guarantee a portion of losses in the event the loan defaulted later on.

unless certain criteria are met. You can see what this could do to our industry. It could increase Due to its overly restrictive nature, QRCE would needlessly hold back

borrowing costs and reduce liquidity in the market while lending is

many otherwise solid transactions from taking place. I spoke about

already constricted. It could stop otherwise viable commercial real

QCRE in one of my podcasts this summer, and I’d like to talk about it

estate transactions right in their tracks. I don’t think we can afford that.

again because I think it’s that significant to our industry. Since the

I hope you agree with me.

premise of QCRE is requiring lenders to have “skin in the game,” I decided to do a little research.

That’s why NAR is in contact with federal regulatory agencies to help them finalize rules that would help -- not hurt-- the commercial real

I found out the term “skin in the game” was coined by the legendary

estate market. We anticipate that we’ll see something finalized later

investor, Warren Buffett. As he used it, it refers to a situation in which

this year and we’ll keep you posted on REALTOR.org when that

high-ranking corporate insiders use their own money to buy stock in

happens.

their companies, as a way to build confidence among investors. I also invite you to join the conversation at the NAR commercial blog You may be thinking that if Warren Buffett believes skin in the game is

at: www.Blog.CommercialSource.com

a good idea -- it must be, right? While it may make sense for stock investors, when it comes to commercial real estate -- instead of

Bill Armstrong, 2012 NAR Treasurer, and 2000 MAR President M A R Y L A N D R E A L T O R ® December 2011/January 2012

33


From the Hotline Charles A. Kasky, Esquire

Recent Maryland Cases Create Uncertainty Two recent Court of Appeals Cases have created a great deal of uncertainty within the legal and real estate communities. Both were decided on constitutional grounds.

authorized agents and property managers dealing with affected properties are urged to consult with their attorney to determine the appropriate course of action.

In the first case, the court held that the immunity provisions of the Reduction of Lead Risk in Housing Act (“Lead Paint Act”), which provide compliant landlords with qualified immunity from tort liability under specified circumstances, violate Article 19 of the Maryland Declaration of Rights. In the second case, the law (“Ground Rent Act”) extinguishing ground rents that were not registered was invalidated as an unconstitutional taking of property without compensation.

In Muskin v. State Department of Assessments and Taxation, the Court overturned a key part of the 2007 law, which extinguished unregistered ground rents. Under the Ground Rent Act, ground rent leaseholders were given three years to register ground rents with the State Department of Assessments and Taxation, or the ground rent would be subject to being extinguished. The ruling issued by the court said that extinguishing the ground rents is an unconstitutional taking.

In the Lead Paint case (Jackson v. Dackman), the Court concluded that the substituted remedy under the Lead Paint Act for a child permanently brain damaged due to the child’s ingestion of lead-based paint in the rental property was inadequate and unreasonable to ameliorate the harm done. The Court also held that the unconstitutional provisions of the Act could be severed from the remainder of the Act, leaving all other provisions unchanged.

The State Department of Assessments and Taxation has updated its website with the following statement: All ground rents that would have been extinguished for failure to register them are as valid as they were before the registration deadline. Any Certificate of Extinguishment issued by this Department is void and has no effect.

The Lead Paint Act defines “owner” to mean a person or entity who owns, holds, or controls the interest to any property. The Act specifies that the term “owner” includes any buyer in possession of the property and any authorized agent of the owner, including a property manager or leasing agent. The impact of the Court’s decision is that owners, agents and property managers are at an increased risk for liability resulting from an alleged injury or loss caused by the ingestion of lead by a person at risk. In other words, an affected person may sue an owner for an injury or loss and recover an amount exceeding $17,000, which was the maximum amount payable under the law, which is no longer applicable. Property owners should continue to comply with all of the requirements of the Act. Property owners who “opt-in” to the program can continue to do so. As with pre-1950 properties, qualified immunity from tort liability no longer exists. Continuance of registration and performance of the risk reduction activities at each change in occupancy may assist in the demonstration of due care on the part of the property owner. Owners,

FREE Legal Hotline 34

Although failure to register the ground lease cannot be the basis for extinguishing it, the ruling left intact the requirement to register ground rents. Now, however, there is no penalty for not doing so. On that note, the Court suggested some examples of alternative statutory approaches that would not be impermissible. For example, a similar registration scheme might be one where failure to register a ground lease triggers an interim consequence, such as restrictions on collecting rents prospectively, or a denial of access to the courts for enforcement of unregistered ground rents until registration occurs. The state will likely notify homeowners that ground rents have been reinstated. We will update you on any legislative proposals to address this issue.

Charles A. Kasky, Esquire, Vice President of Legal Affairs Maryland Association of REALTORS®

1-800-888-1272 • Monday, Wednesday and Friday • 10am – Noon and 2 pm – 4 pm www.mdrealtor.org • Complete an Online Form available in the Legal Hotline tab

M A R Y L A N D R E A L T O R ® December 2011/January 2012


Residential Sales Anirban Basu

Housing Market Indicators

Slump Again in October Sales Prices Continue To Decline in Maryland

Nothing dramatic has occurred in the economic environment to suggest that the

Unit sales have been roughly flat or in decline, implying that even near-record low mortgage rates have not been enough to tempt large numbers of potential homebuyers back into the marketplace.

level of housing market activity will be materially different from what has been transpiring currently. For much of this year,

Job growth continues to be subpar in Maryland. Though recent months have been a bit better, Maryland has only added 0.5 percent to job totals over the past year, roughly one half the national rate of 1.2 percent (September 2010 to September 2011). That pace of job growth

price dynamics have been negative, with both median and average sales prices still in

ranks Maryland 39th in the nation in that area. Economic and employment growth is expected to be quite soft in the months ahead, which implies that the status quo trajectory in the housing market is

decline.

unlikely to shift markedly over the next several months.

M A R Y L A N D R E A L T O R 速 December 2011/January 2012

35


Residential Sales

Continued from page 35

October 2011 vs. 2010 Units Average Price

According to data supplied by MRIS

County 2011

and

Allegany 29 40 -27.5% $98,059 $108,418 -9.6%

the

Coastal

Association

of

2010 Change

2011

2010 Change

REALTORS ®, October unit sales were

Anne Arundel 369

366

0.8% $323,721 $357,754 -9.5%

down 2.8 percent in Maryland on a year-

Baltimore City 325

342

-5.0% $126,008 $133,493 -5.6%

over-year basis, with only 10 jurisdictions

Baltimore County 467

experiencing

sales

increases.

A

significant increase in sales was registered in both Baltimore County (20.1%) and Prince George’s County (7.9%),

both

large

counties

with

significant supplies of affordable workforce housing. These jurisdictions appear to be attracting a significant share of middle-income households drawn to past and ongoing declines in price levels. Between October 2010 and October 2011, median sales price dipped 8 percent in Baltimore County and more than 21 percent in Prince George’s.

389 20.1% $234,217 $246,830 -5.1%

Calvert 56 54

3.7% $291,087 $289,517 0.5%

Caroline 12 20 -40.0% $164,583 $144,599 13.8% Carroll 100

102

-2.0% $277,441 $283,653 -2.2%

Cecil 41 58 -29.3% $230,310 $247,422 -6.9% Charles 117

126

-7.1% $227,129 $237,188 -4.2%

Dorchester 25 26

-3.8% $121,344 $195,577 -38.0%

Frederick 183

176

4.0% $265,684 $283,634 -6.3%

Garrett 35 31 12.9% $281,591 $398,117 -29.3% Harford 142

201 -29.4% $250,980 $252,352 -0.5%

Howard 208

220

-5.5% $369,878 $394,753 -6.3%

Kent 16 11 45.5% $443,056 $231,173 91.7% Montgomery 634

700

-9.4% $411,221 $439,590 -6.5%

Prince George’s 626

580

7.9% $171,631 $208,857 -17.8%

Queen Anne’s 43 33 30.3% $310,103 $271,342 14.3% Somerset 10 22 -54.5% $108,720 $107,872 0.8%

Other jurisdictions registering year-over-year unit sales increases in October include Talbot County (25%) and Garrett County (12.9%), which might indicate renewed interest in the second homes market in portions of Maryland. However, Worcester County, home to Ocean City, experienced a 23.4 percent decline in unit sales, which undermines that hypothesis.

St. Mary’s 53 74 -28.4% $296,681 $297,106 -0.1% Talbot 30 24 25.0% $344,953 $853,508 -59.6% Washington 87 81

7.4% $174,276 $158,155 10.2%

Wicomico 48 60 -20.0% $152,777 $150,195 1.7% Worcester 95 124 -23.4% $252,310 $309,329 -18.4% Total 3,751 3,860

-2.8% $264,183 $289,877 -8.9%

Figures reflect resales and new properties. Residential resales are reported by MRIS ® and local boards MLS systems.

36

M A R Y L A N D R E A L T O R ® December 2011/January 2012


Other jurisdictions registering year-over-year declines in October unit

rates of workforce housing making properties more affordable and thus

sales include Somerset (-54.5%), Caroline (-40.0%), Cecil (-29.3%), St.

more inclined to be purchased.

Mary’s (-28.4%), Allegany (-27.5%), Harford (-24.9%), Wicomico (-20.0%), Montgomery (-9.4%), Charles (-7.1%), Howard (-5.5%),

Looking Ahead

Baltimore City (-5.0%), Dorchester (-3.8%) and Carroll (-2.0%).

In many ways, 2011 represented a repeat of 2010. The year was associated with volatile financial markets, slow job growth, stubbornly

Sales prices continue to decline in Maryland. Average prices fell 8.9

high unemployment, concerns regarding European sovereign debt,

percent statewide between October 2010 and October 2011, with 17

policy uncertainty emerging from Washington and various state

jurisdictions registering year-over-year declines. The largest decline

capitals, falling home prices and cautious consumers. Next year may

was experienced in Talbot County (-60%), where average price fell

in many ways reflect 2011, which implies that the housing market

from $853,500 to approximately $345,000. In Dorchester County

recovery will continue to be a grinding one.

(-38%), average sales price dipped from roughly $195,600 in October 2010 to $121,300 one year later. In Worcester County, average price

That said, there are still indications of progress. Pending unit sales

was off by 18.4 percent. All of this suggests that available buyers on

statewide totaled 5,441 in October 2011, up from 4,506 one year earlier.

the Eastern Shore are generally looking for bargains, and that there is an ongoing lack of significant emphasis upon luxury and prestige. However, in Kent County, average price was up nearly 92 percent, though this was based upon a small sales sample of sixteen units in October 2011.

Other

jurisdictions experiencing average price declines include Anne Arundel County (-9.5%), Garrett County (-29.3%) and Cecil County (-6.9%).

Welcome home to the country.

Among the seven jurisdictions that registered increases in average sales prices over the past year were Queen Anne’s (14.3%), Caroline (13.8%), Washington (10.2%), Wicomico (1.7%), Somerset (0.8%) and Calvert (0.5%).

Buying a home in the country is even easier than you think when you work with Farm Credit. With our Country Mortgages programs, we have the products your clients need. Homeownership isn’t just a dream for customers that work with Farm Credit—it’s a reality. Tell your clients to give us a call.

888.339.3334

It is important to note however, that a number of these jurisdictions have significant

Lending support to rural America™

farmcreditmortgage.com

M A R Y L A N D R E A L T O R ® December 2011/January 2012

37


Residential Sales

Continued from page 37

This represents an increase in pending sales of 21 percent. However,

8.5 months one year ago. Howard and Frederick counties also have

this figure may be biased upward due to the impacts of the federal tax

months of inventory below 7 months.

credits available in 2010, which likely accelerated sales early last year and therefore may have created a drag on sales thereafter.

For the pace of recovery to accelerate, a few things must occur. First, job growth must accelerate significantly. This will help support both the

The active inventory of unsold homes has fallen from 40,302 to 34,277

first-time and move-up buyer markets. Second, asset prices must

over the past year. This represents a decline of almost 15 percent. The

continue to rise, including equity prices. Better stock market

implication is that supply-demand equilibrium is approaching.

performance would both boost confidence among prospective buyers

Months of inventory has fallen from 10.4 months to 9.1 months. In

and would also create greater resources available for down-payments.

certain jurisdictions, equilibrium has already been achieved, including

Finally, lending conditions and appraised values must stabilize to enable

in Montgomery County where the months of supply is down to 5.1

a larger share of prospective buyers to qualify for mortgages.

months. In Prince George’s County, evidence of progress remains apparent, with the months of inventory now down to 6.3 months from

Anirban Basu, Sage Policy Group, Inc.

GRI – The Next Level

Here’s what you can expect from attending GRI –

■ networking and referral opportunities

■ increased knowledge on a wide array of topics and skill enhancements

■ confidence building through in-depth knowledge, skills training and better understanding of industry practices ■ earn a national designation which has proven greater income potential ■ receive continuing education credits, and

■ earn credits toward your broker/associates broker’s license.

Why wait? For class schedules and program details, visit www.mdrealtor.org. Click the Education tab and scroll to REALTOR® Institute (GRI), GRI Overview. 38

M A R Y L A N D R E A L T O R ® December 2011/January 2012


Weichert Works ®

For over 40 years, Weichert, Realtors® has been providing the best quality tools, training and support for its sales associates. Today we are coast to coast with over 400 company and franchised offices and 18,000 agents strong. The Weichert Difference · Award winning Sales Training* · A Unique Lead Network providing quality leads to associates. · Weichert.com, an award winning Top 5 Real Estate Brokerage Website** · Weichert University, online and available 24/7, with 150 courses to make you more productive. · Time-proven Listing and Marketing systems to make you more successful.

Isn’t it time you let Weichert Work for you? Call a local Weichert office or visit Weichert.com.

Equal Opportunity

Employer

*Weichert.com received Bronze Award in the Real Estate category of the 10th annual International iNOVA Awards competition for its website, Weichert.com. Interactive Media Awards (IMA) Outstanding Achievement Award 2010 **2010 ASTD BEST Award from the American Society for Training & Development. Weichert is among 31 organizations from across the world to receive the award and ranked 12th overall out of the more than 100 organizations that entered the competition. Each Weichert franchised office is independently owned and operated. © 2011 Weichert Real Estate Affiliates, Inc. All rights reserved.

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