Trust This. Brokerages Adapt to New Rules – Bulk Homebuyer Bill – TRIM Alerts
Trust This. By Joseph E. Seagle, Esq. ● Aug 23, [...]
Trust This: NAR’s Legal Labyrinth Unraveled
1 big thing: NAR's Legal Labyrinth The Department of Justice [...]
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Trust This. By Joseph E. Seagle, Esq. ● Aug 23, 2024 Smart Brevity® count: 6 mins…1542 words 👋 Happy Friday! Today is National Cuban Sandwich Day, and we all know that — outside of Cuba itself (if you can find one) — Florida is the best place for one of these delicious sandwiches (but we’re not biased). 🚨 Situation Awareness: Real property tax TRIM notices are out. We’re processing them as quickly as possible: scanning, renaming, uploading to the portal, and sharing them with beneficiaries as fast as we can go. However, the deadline to challenge valuations or exemption denials is extremely short. We just started receiving them last Friday, and the deadline to appeal to the Value Adjustment Board is only 25 days from when the TRIM notice is mailed (not received).
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1 big thing: Brokerages Are Figuring Out Their Own New Normal
As of August 17, broker commissions can no longer appear in any MLS in the United States, per the National Association of Realtors’ (NAR) commission lawsuit settlement agreement. A quick recap: The intention behind the settlement was to curb steering so that buyers’ agents would show clients all available homes, regardless of their potential commission, leveling the playing field for buyers. Why it matters: Although the new NAR rules apply throughout the country, there’s no nationwide standard on how to apply them. Brokerages are taking various routes to compliance.
Some different approaches:
What we’re seeing: We sign dozens of purchase contracts each week, and we’ve noticed that the package for e-signing now includes a buyer-brokerage agreement in most cases.
The bottom line: As brokerages settle into the new normal, their differences in approach could lead to further friction in the industry — as well as a nationwide patchwork of solutions. |
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2. Bulk Homebuyers Are the Target of a New Bill
A new U.S. Senate bill would require buyers to disclose bulk purchases of single-family homes to federal regulators for antitrust review. Why it matters: According to a statement, the bill aims to “stop anticompetitive transactions that could increase rents, decrease services, and push homebuyers out of the market.”
The targets: HART targets corporations and private equity firms in the SFR (single family rental) industry. Brief timeline of SFRs:
What it would do: The Act would require bulk purchases of single-family homes to report to the:
Who’s behind it: Amy Klobuchar (D-Minnesota) and Sherrod Brown (D-Ohio) proposed the HART Act. Their position: “Housing is becoming increasingly concentrated in the hands of large corporations,” Klobuchar has noted, leading to consumer problems. These include:
Who else in the Senate supports it:
Supporters outside of Congress:
The bottom line: Watch this bill as it moves through the legislative process—it could drastically change the housing and rental markets. |
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Anonymity has its place in any asset protection strategy.
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3. Catch up fast
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4. Closing Thought: Vision/mission statements are critical
We get it, so you don’t have to. The annual TRIM notices are flowing into our PO Box daily. This is just one day’s haul heading from the PO to our offices to be processed. If you want your TRIM notice sooner than later, you can go to the county property appraiser online to pull it. Otherwise, watch your inbox for an e-mail from Clio, our online portal where we securely share the mail we receive with you.
Crafting a meaningful vision statement starts with understanding your core beliefs.
Reflect: Spend time considering your values and what you believe your business can uniquely contribute. Engage others: Involve key stakeholders in this process, including employees and clients. Their perspectives can offer valuable insights and help ensure your vision resonates broadly. Be specific: Your vision statement should be clear, concise, and focused on a tangible aspiration. Avoid vague language; instead, articulate an inspiring and actionable vision. What’s next: Infusing Vision into Your Business
The bottom line: A well-developed and articulated vision speaks to the heart and gut, guides your business, and inspires and unifies your team, creating a strong foundation for long-term success. |
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We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below.
Be on the lookout for our next issue! 👋 |
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Feedback Please share your thoughts on this edition. Was this edition useful?
Your responses are anonymous |
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Trust This. By Joseph E. Seagle, Esq. ● Aug 23, 2024 Smart Brevity® count: 6 mins…1542 words 👋 Happy Friday! Today is National Cuban Sandwich Day, and we all know that — outside of Cuba itself (if you can find one) — Florida is the best place for one of these delicious sandwiches (but we’re not biased). 🚨 Situation Awareness: Real property tax TRIM notices are out. We’re processing them as quickly as possible: scanning, renaming, uploading to the portal, and sharing them with beneficiaries as fast as we can go. However, the deadline to challenge valuations or exemption denials is extremely short. We just started receiving them last Friday, and the deadline to appeal to the Value Adjustment Board is only 25 days from when the TRIM notice is mailed (not received).
|
||
1 big thing: Brokerages Are Figuring Out Their Own New Normal
As of August 17, broker commissions can no longer appear in any MLS in the United States, per the National Association of Realtors’ (NAR) commission lawsuit settlement agreement. A quick recap: The intention behind the settlement was to curb steering so that buyers’ agents would show clients all available homes, regardless of their potential commission, leveling the playing field for buyers. Why it matters: Although the new NAR rules apply throughout the country, there’s no nationwide standard on how to apply them. Brokerages are taking various routes to compliance.
Some different approaches:
What we’re seeing: We sign dozens of purchase contracts each week, and we’ve noticed that the package for e-signing now includes a buyer-brokerage agreement in most cases.
The bottom line: As brokerages settle into the new normal, their differences in approach could lead to further friction in the industry — as well as a nationwide patchwork of solutions. |
||
2. Bulk Homebuyers Are the Target of a New Bill
A new U.S. Senate bill would require buyers to disclose bulk purchases of single-family homes to federal regulators for antitrust review. Why it matters: According to a statement, the bill aims to “stop anticompetitive transactions that could increase rents, decrease services, and push homebuyers out of the market.”
The targets: HART targets corporations and private equity firms in the SFR (single family rental) industry. Brief timeline of SFRs:
What it would do: The Act would require bulk purchases of single-family homes to report to the:
Who’s behind it: Amy Klobuchar (D-Minnesota) and Sherrod Brown (D-Ohio) proposed the HART Act. Their position: “Housing is becoming increasingly concentrated in the hands of large corporations,” Klobuchar has noted, leading to consumer problems. These include:
Who else in the Senate supports it:
Supporters outside of Congress:
The bottom line: Watch this bill as it moves through the legislative process—it could drastically change the housing and rental markets. |
||
|
Anonymity has its place in any asset protection strategy.
|
||
3. Catch up fast
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||
4. Closing Thought: Vision/mission statements are critical
We get it, so you don’t have to. The annual TRIM notices are flowing into our PO Box daily. This is just one day’s haul heading from the PO to our offices to be processed. If you want your TRIM notice sooner than later, you can go to the county property appraiser online to pull it. Otherwise, watch your inbox for an e-mail from Clio, our online portal where we securely share the mail we receive with you.
Crafting a meaningful vision statement starts with understanding your core beliefs.
Reflect: Spend time considering your values and what you believe your business can uniquely contribute. Engage others: Involve key stakeholders in this process, including employees and clients. Their perspectives can offer valuable insights and help ensure your vision resonates broadly. Be specific: Your vision statement should be clear, concise, and focused on a tangible aspiration. Avoid vague language; instead, articulate an inspiring and actionable vision. What’s next: Infusing Vision into Your Business
The bottom line: A well-developed and articulated vision speaks to the heart and gut, guides your business, and inspires and unifies your team, creating a strong foundation for long-term success. |
||
|
We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below.
Be on the lookout for our next issue! 👋 |
||
|
Feedback Please share your thoughts on this edition. Was this edition useful?
Your responses are anonymous |
||
|
Powered by
|
||
1 big thing: NAR's Legal Labyrinth
The Department of Justice (DOJ) has re-opened its antitrust probe into the National Association of Realtors (NAR). This comes on the heels of NAR’s $418 settlement agreement in several antitrust lawsuits alleging a conspiracy in how buyer and seller agents’ fees are disclosed and paid.
At issue for the DOJ: Whether NAR’s rules for agent commissions violate antitrust laws and trigger inflated home prices.
Why it matters: Uncoupling buyer’s and seller’s agent commissions could lower the cost of selling — and therefore buying — homes by a lot. Such an outcome would also affect how agents are paid for their work.
The DOJ wants to make it illegal for a buyer’s and seller’s broker to discuss commission splitting at all.
Under the proposed NAR settlement, while they wouldn’t be allowed to disclose the commission splits up front on the MLS, they could still put them on their websites and business cards and at least tell each other what they would pay in a commission split.
DOJ concern over NAR practices has trod a long and winding road in the last two decades.
2005: DOJ sues NAR, claiming anticompetitive practices
2008-2018: NAR agrees to change some of its listings practices
2019-2020: DOJ re-opens the investigation but soon settles, requiring only that NAR disclose more information about broker fees in sales listings
2021-2024: DOJ re-reopens the investigation, requesting more information about broker commissions and real estate listing practices; NAR wins a federal court ruling to shut it down; DOJ appeals
April 5, 2024: The US Court of Appeals in DC overturns the lower court’s decision.
The result: The DOJ should soon receive previously undisclosed NAR documents, which could provoke further legal action or even new regulations.
DOJ’s international perspective: One factor that seems to have piqued DOJ’s interest in NAR is the fact that real estate commissions in the U.S. are higher than in other countries.
What’s next: The DOJ hopes its renewed investigative efforts will reduce the expenses associated with real estate transactions for homeowners and buyers.
Tough times for NAR: In addition to the March settlement and the re-opening of the DOJ inquiry, the powerful group has had a spate of recent harassment allegations and resignations to deal with.
Its reputation is fraying (to say the least), and the organization is on the ropes.
The fact that NAR failed to run the commission settlement by the DOJ first to ensure it would also satisfy the Department indicates that the Association is playing checkers in a Mahjong tournament.
The bottom line: The entire real estate industry needs to be poised to manage a potential paradigm shift. Whether NAR will lead in this brave new world remains to be seen.
2. Commercial Real Estate in Decline Is Bad News for Cities
Commercial property values are undergoing a sharp decline nationwide. For many cities, that’s forcing stressful cutbacks.
What’s happening: In cities like San Francisco and Chicago, commercial properties are sold for a fraction of their original purchase price.
This is because of lower property valuations, which, in turn, can lead to diminished tax collections and strained municipal budgets.
Why this matters: Reduced commercial tax revenue means cities can no longer afford to cover essential services (think transportation, education, healthcare) and infrastructure maintenance.
The “doom loop”: There are no easy answers here.
With property values and tax revenue falling, cities may need to increase taxes.
With increased taxes, more businesses and residents could decide to relocate — or fewer decide to move in.
With fewer resources, cities face tough choices about which essential services to continue offering.
More people will consider leaving when a city no longer offers nice parks, high-quality healthcare, or transportation.
The disinvestment trend: Federal aid and fiscal cushions municipalities have relied on in recent years are less available.
Some cities are trying to be proactive by postponing maintenance and public projects, but that’s just kicking the can down the road.
The long-term implications: Many cities could opt for significant urban restructuring to move forward. For their part, developers are rethinking their approach:
They’re considering new uses for vacant spaces and finding ways to boost value, converting under-used office buildings to residential or mixed-used units, for example.
They prioritize green building standards, which could attract new investors and tenants.
They’re thinking past commercial properties to alternative sectors like industrial real estate.
The bottom line: If commercial property values continue to sink, cities will face increasingly difficult choices. They’ll need creative solutions to thwart the downward spiral.
3. Catch up fast
The American Land Title Association, representing hundreds of thousands of title insurance agencies and insurers, has sent a letter to FinCEN recommending changes to FinCEN’s proposed rule to require all entities and trusts to disclose their ultimate beneficial owners when they purchase U.S. real estate. ALTA
Three strategies to mitigate risks in real estate investing. MPAMag
FinCEN renewed the Geographic Targeting Order. If an LLC, corporation, partnership or other legal entity (not a trust) uses cash to purchase a residential property for $300,000.00 or more in Miami-Dade, Broward, Palm Beach, Hillsborough, Pasco, Pinellas, Manatee, Sarasota, Charlotte, Lee, or Collier Counties, then the closing agent is required to discover and disclose the names of the beneficial owners of the buyer to FinCEN. FinCEN
Inflation is coming down in every sector except housing, and rents are the driving factor as those in the northeast and midwest refuse to come down. Bloomberg (gift link good for 7 days only)
Seven reasons why the housing market hasn’t recovered from the pandemic. Bigger Pockets
4. Closing Thought
Rocks aren’t obstacles in the river of life. They’re rugged materials used to build a life.
Why it matters: Visualizing rocks in this way helps us get through the days and build our year.
In the Entrepreneurial Operating System’s lexicon, “rocks” are what most businesses would call “projects” or “quarterly goals.”
At each weekly, quarterly, and annual meeting, we come together as company leaders to identify, discuss, and solve issues.
Issues aren’t always bad. They’re just issues we’re facing that, if solved, would help the company achieve its mission and the owner’s vision.
The solution to many issues requires uncovering a rock or two that must be chipped away weekly over the next quarter.
I like to think that it also comes from the old story about the professor lecturing his students with a big jar of rocks, pebbles, sand, and water.
The rocks are the big things that matter in your business.
If you spend too much time on the sand and pebbles, you won’t have time for the rocks.
So we keep our rocks front and center before us, discussing them weekly at our meetings and holding each other accountable to ensure the person in charge of each rock will chip away at the stone until it’s completed.
When building a business, remember that the foundation must be durable. Rocks are a strong part of that foundation.
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