Interesting Developments at the Board of Directors Meeting

By Brian Summerfield, Online Editor, REALTOR® Magazine

There was a lot of ground covered during the Board of Directors meeting Monday at the 2009 REALTORS® Conference & Expo. Here are some of the highlights:

• The REALTOR® Property Resource (RPR): Attendees got a guided tour of this impressive new site, which ultimately aims to cover pretty much every property in the United States. RPR will be a massive database that will allow NAR members (and only NAR members) to search properties across numerous criteria, from school districts to tax info. Users will also be able to gauge the value of a property based on home improvement projects, site conditions, and comparables. Call it contemporary. Call it cutting edge. Just don’t call it an MLS. Read more

Stevens Strongly Defends FHA’s Financials

By Brian Summerfield, Online Editor, REALTOR® Magazine

In an address to hundreds of REALTORS® at the 2009 NAR Conference & Expo Saturday afternoon, FHA Commissioner David Stevens offered a fervent defense of the organization’s financials. He specifically addressed the negative press surrounding the FHA’s recent audit, which showed part of its capital reserves below congressionally mandated levels.

Stevens distinguished the FHA’s capital reserves for unexpected losses from its regular reserve fund, which remains above 2 percent. Together, the two funds equal almost 4 percent in reserves. “We’ve come through the 100-year flood,” he said. “Despite the crisis, FHA is still standing with $31 billion in capital, $3.5 billion more than it had a year ago.” Read more

RPR and HouseLogic: Projects of Striking Scale

By Robert Freedman, Senior Editor, REALTOR® Magazine

So many announcements are made at NAR’s annual meeting that it’s easy to lose sight of just how trend-shifting some of them are. At the opening forum of the 2009 REALTORS® Conference & Expo in San Diego yesterday, NAR CEO Dale Stinton made back-to-back introductions of two initiatives that stand to define how you’ll do business in the years ahead.

The first is the REALTORS® Property Resource, something NAR leaders first started discussing several years ago then gave the go-ahead about two years ago as part of NAR’s massive Second Century Initiatives.

When it launches in the second quarter of 2010, it will be a database of 147 million parcels of real estate accessible to all REALTORS®. For each parcel you’ll have quantitative data—size, assessment, and so on—plus qualitative data: comments from you and your colleagues on what’s really key about the property.

Any database that has 147 million of anything is a massive resource; when the data consists of the amount and quality of the information that Stinton describes, you really get a sense of its scale. It will put an unprecedented amount of informaton at your fingertips, making you a go-to resource for your customers that would have simply been impossible years ago. If you think about it, it’s exactly the kind of thing that associations should be doing for their members: pooling their resources to undertake massive projects that shift the long-term competitive landscape in their favor. Read more

Sun, Surf, and Success in San Diego

By Brian Summerfield, Online Editor, REALTOR® Magazine

The NATIONAL ASSOCIATION OF REALTORS® kicks off its 2009 Conference & Expo this week in San Diego. It’s the first time it’s ever been held here, and attendees who have never been to “America’s Finest City” before are in for a real treat. San Diego offers a very agreeable climate (at least to someone who’s coming from Chicago in November), and the Convention Center and nearby hotels are surrounded by interesting things to see and do.

This year’s Conference & Expo promises to be edifying and fun. There are approximately 400 exhibitors this year, and the aisles will be packed with real estate pros checking out the latest in everything from mobile real estate apps to transactional tools to selling techniques. Also, the workshops and sessions will provide insights on just about every topic related to real estate, from social media to research resources. Attendees can get info on a broad range of subjects, or go through more concentrated tracks based on their background; these include young professionals, broker/owners, and commercial practitioners. Read more

FHA Eases Concentration, Other Condo Rules

By Robert Freedman, Senior Editor, REALTOR® Magazine

In an effort to give condo lending a boost, FHA yesterday released a mortgagee letter (2009-46 A) that lets lenders make loans to condo buyers even if it means 100 percent of the project units would have FHA financing.

That’s a level of market exposure far above what FHA is allowing in its baseline rules (which you’ll find in another mortgagee letter: 2009-46 B), which limit FHA concentration to no more than 30 percent of units.

FHA is also easing its 50-percent owner-occupancy requirement—long an industry concern—by allowing lenders to exclude foreclosed properties in their calculation. That could go a long way in helping buyers in the hardest-hit areas tap FHA financing because it means none of a project’s distressed units count against the owner-occupancy limit.

The agency’s also allowing lenders to make spot loan approvals until February 1, 2010. If you’re not familiar with spot approval, it’s an authority given to lenders to finance one unit in a project that hasn’t yet been approved by FHA for financing.

These and a few other changes that reflect a realistic assessment of today’s market conditions take effect Dec. 7 and they last, with the exception of the spot approvals, until the end of 2010.

If you’re going to San Diego for the 2009 REALTORS® Conference & Expo this week, make it a point to hear FHA Commissioner David Stevens in the An Hour with the FHA Commissioner session. Read more

New Financial Regulator Would Impact You

By Robert Freedman, Senior Editor, REALTOR® Magazine

But not in the way you might think.

A new financial regulator is in the works but it’s one of those developments that’s easily lost in the news while other federal initiatives command the headlines.

The Consumer Financial Protection Agency (CFPA), which passed the House Financial Services Committee just a few weeks ago, would represent a sweeping change in the way financial services companies are regulated. Right now, our alphabet soup of federal banking regulators—OCC, FDIC, NCUA, and so on—have two missions: 1) to oversee the safety and soundness of financial services companies, and 2) to protect consumers.

The logic behind CFPA is to split off the consumer-protection side of the regulators’ portfolio so they can focus on bank safety and soundness. The new agency would focus on consumer protection.

What’s key for real estate professionals is that CFPA will focus only on financial services companies. That seems obvious, but it wasn’t always this way. As the language was originally drafted, any number of professional services that handle money in some way would have fallen under the definition of financial services. Thus, real estate professionals, who handle earnest-money deposits among other things, could have been subject to regulation under CFPA.

The fact that the House Financial Services Committee makes clear in its bill that real estate brokers and sales associates aren’t regulated under CFPA is an advocacy victory for REALTORS®, who, through NAR, let lawmakers know that the original draft would lead to unforseen consequences if it wasn’t changed. It was.

You should be aware that CFPA could still touch the real estate transaction in several ways, though. Read more

Looking Good, REALTOR.org!

By Brian Summerfield, Online Editor, REALTOR® Magazine

If you regularly visit REALTOR® magazine online, chances are pretty good that you also check out our sister site, REALTOR.org, from time to time. In case you haven’t seen it yet, NAR’s official site got a design refresh yesterday, and it’s already getting some props in the RE.net. Deservedly so, too–kudos to our REALTOR.org colleagues on a job well done!

An Under-the-Radar Win for Common Sense

By Robert Freedman, Senior Editor, REALTOR® Magazine

It’s a small thing, but it’s impact could have been big. Some new federal lending rules take effect tomorrow (under HOEPA—the Home Ownership and Equity Protection Act) and among them is a restriction on prepayment penalties, something anyone who’s taken out a mortgage would certainly appreciate. No one likes to pay a prepayment penalty, and certainly not when they’re abusive.

But lenders were concerned that the rule, which imposes the prepayment restriction on higher-priced loans (those with an interest rate 1.5 percent above prime), would snag higher-priced FHA loans. FHA requires borrowers, when they pay off their loan, to pay the entire month’s interest, no matter when during the month the pay-off occurs.

Depending on how you look at it, that extra interest payment has the character of a prepayment penalty, and indeed, NAR has been trying to get FHA to change that policy. Read more

Getting the Tax Credit Extended: Outlook

By Robert Freedman, senior editor, REALTOR® Magazine

What are the chances of getting the first-time home buyer tax credit extended, particularly before its expiration Dec. 1? No one can know that, of course, but what’s clear is that the leadership in Congress wants it extended—and if you have the leadership on board, you’re in a strong position. Yet with health care reform consuming Congress’ attention, even the leadership faces a challenge ensuring the tax credit gets the consideration it deserves.

After sitting down with Linda Goold, NAR’s director of tax policy, and Samuel Whitfield, an NAR legislative representative, I learned the tax credit has really been the economic recovery’s workhorse. The IRS says 1.4 million households have used the credit. What’s more, a number of independent looks at the credit, including one by Economy.com (owned by Moody’s) and Campbell Surveys, estimate that between 350,000 and 400,000 home purchases would not have happened without the credit. NAR has come up with a similar estimate.

Goold and Whitfield say there’s bipartisan support for extension, and NAR is on Capitol Hill daily reminding lawmakers that the clock is running. But it’s coming down to the wire.

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