Dave Philipp

Below is the text of an Email I received today, I have responded to the CAR but not yet received a reply. What do you think California Realtors?

C.A.R. is opposing AB 957 (Galgiani), the so-called “Buyers Choice Act,” which will legally force sellers to use the title and escrow providers chosen by the buyer when selling an REO property. C.A.R. opposes AB 957 because it puts all control in the hands of one side of the transaction.

AB 957 will be voted on in the Assembly Judiciary committee next Tuesday, May 5^th. Your Assembly member is a member of this committee.

Background

Last week the California Assembly Banking and Finance Committee passed AB 957, based in part upon Assemblywoman Galgiani's commitment to "work with" C.A.R. concerns. “The Buyers Choice Act” is now set for its next hearing in the Judiciary Committee. AB 957 is sponsored by the California Escrow Association. The proposed legislation will mandate that the choice of title and escrow services be made by the buyer, not by the bank or other seller of a foreclosed property, on all real estate-owned (REO) transactions.

Talking Points

Two Way Negotiation is Needed. C.A.R. opposes the bill out of concern that it removes the choice of escrow from negotiation, and puts all control in the hands of one side. C.A.R. supports good faith negotiations and fair dealing, and supports full compliance with RESPA.

Beware of other players with other agendas. Please also note that Property ID, a company that frequently has its own agenda in supporting or opposing legislation, is contacting REALTORS® and attempting to gain their support.

Three Amendments are Needed. In the Banking Committee hearing, the author asked C.A.R. to reconsider its opposition in light of a commitment to consider 3 changes in the bill.

• First, a "sunset" on the duration of the bill so that it will be reconsidered as the market recovers.
• Second, Assemblywoman Galgiani also suggested she would be willing to include an enhancement of state regulators’ enforcement of RESPA fair dealing rules; and,
• Finally, language to require that both sides of a transaction negotiate in good faith.

So far, only the RESPA issue has been included, and the bill still mandates that the buyer alone selectstitle and escrow services, a choice that has always been negotiable. C.A.R. LANGUAGE TO INCLUDE FAIR NEGOTIATION HAS BEEN REJECTED.

Okay, so now my question is when in the heck did a bank ever negotiate where the escrow and title will be done? It seems to me that perhaps the CAR is looking at things slightly askew? In an REO my experience is that on those issues all the control is in the hands of the bank, primarily because they make their own rules about sales and contracts. I think the CAR should ask to include a provision that requires the banks to follow the same rules when selling a property that everyone else does!

How about a law regulating the banks ability to completely toss a deal at the last min based on a new offer? How about a provision that eliminates the banks ability to say that the rules dont apply to them? Okay, radical I know but just a thought!

Where have all the Signs Gone?

Do you notice that when you drive around Midtown in general and Boulevard Park specifically there seems to be something missing? Hum, what could it be? The trees are still here as are the meter maids and the meter readers, so that's not it; Hey, it's all the for sale signs that used to be such a constant fixture down most streets in the old hood! Boulevard Park and Midtown have actually got the smallest inventory of homes for sale right now that we've had in the last two years. In fact it was May of 2006 the last time we had as few homes in our area on the market as we did the last two months.

So what, you may ask, does that mean? Well, it means that people in Midtown are fairly savvy and not selling unless they genuinely need to move. It also means that people who want to move to this great neighborhood are circling and waiting because there are so few choices.

Some would say it's because prices have fallen significantly that people are not selling. In Midtown however that's not the truth, read on for more details! Personally I think it's because it's such a wonderful place to live that people aren't selling! Now as to the price argument let's look at the facts. Prices, indeed, have come down some from the peak, although they have been fairly stable in our market we have seen some decline. Many, those who read the major Sac newspaper, still have the impression that we are having the half off plus sales on Real Estate here that are so common in Natomas and Elk Grove. In fact, the truth points more to a gentle decline of 20%-25% over the last three years. While certainly there are glaring exceptions to that math to the negative there are also positive examples of properties actually (gasp) increasing in value during that timeframe.

So what is the price per square foot and how much is my home worth? The truth is that in Midtown it's really hard to peg and there is no one size fits all. Is your house next to homes or apartments? Are you on a full lot or a half lot? Parking off street or not? What does your neighbor's house look like? All these questions go into determining value. Remember though that all the science in the world is useless if no one wants to buy your home. That's where the details really count.

So for Boulevard Park and the city core these are the facts; Inventory is low, price per square foot is all over the board, and people still want, like crazy, to move here! Congratulations on choosing to get here first!