Notes on Real Estate

Hello again. It's time for another Notes on Real Estate. Things are going well for Shelley and myself, considering the market slow down that has put considerable pressure on many REALTORS®. We can always use new business, of course. For those of you who are aware of my recent health concerns, I am recovering strongly and getting better each day. Full capacity isn't here yet, but I can get on a small step ladder and see it on the horizon. The support of my friends and associates has been tremendous – many thanks.

In this issue you will find just one focus. The recent attacks on the real estate industry, nationwide, have made big news, since they are sensational, deal with a gigantic business industry, and have an effect on anyone who owns or plans to own a home. As is the custom, news media goes for the "sensational", and if they can't find it, they create it. The interest rate "news" is one example.

The fact that interest rates are up one full point from a year ago today, has two flash points for all of us.
One: That's no big deal. I know, over a 30 year mortgage, that can amount to a considerable sum. However, we are still way below interest levels that had prevailed throughout the last 50 years.

Two: What response does the buying public have? They back off on purchasing homes. When the Fed goes up, the mortgage industry is only peripherally involved, as they base their rates on other factors. Regardless, the general public gets frantic.

It looks like the Fed is about done with its interest increases, anyways, having put their stopper in the economy.

Let's try to remember that buying a home, even if it isn't primarily for the purpose of being an Income Property, is about leveraging your money while simultaneously having the luxury of living in the investment.

That isn't the main thrust of the recent news media attention. The forthcoming will be self-evident. Here are excerpts from an article from Realty Times which I doubt you will see in whole or in part in the local news media. For the full article, go to Industry Strikes Back

It was such an embarrassment for Representative Michael Oxley, (R)-Ohio, chairman of the Financial Services Committee, that he left halfway through the congressional committee hearings he had called for.

His bipartisan subcommittee was clearly not impressed by the parade of whining, sniveling dot-coms who want Big Daddy to eliminate their competition for them by destroying so-called traditional brokers, the MLS and the NAR. [T. C. Note: This is Oxley's own committee, and it is bipartisan!]

They want access to the MLS without regard to sellers' or listing brokers' rights. Neither were they impressed by the persecution of the real estate industry by the DOJ and FTC. Panel members, particularly Maxine Waters, (D)-California seemed irritated, and the overall conclusion of the committee was that there was no need for congressional intervention.

That's a good thing -- because the subcommittee was called purely out of spite. Frankly, Oxley is batting 0 for 3 against the real estate industry:

1. His Fair Choice in Real Estate Act, an act that favors banks in real estate failed to garner more than one other congressional supporter.
2. Last week, the Senate Appropriations Committee approved legislation that would permanently ban U.S. banks from engaging in real estate activities.
3. There was no bill attached to the outcome of the subcommittee's probe into real estate competitive practices. Not only did NAR and RE/MAX defend the industry, but the self-serving scheming and whining of the dot-coms, DOJ, and FTC caused his own committee to kick back with a humiliating conclusion -- we don't know what we're doing here, and there's no congressional intervention needed.

The good news? The real estate industry is finally fighting back against the DOJ, FTC, banks and their paid hired guns like Oxley and the Consumer Federation of America.

Because Oxley failed to come up with examples where consumers are harmed by the present system, the Consumer Federation of America has joined Oxley's cause spewing out of date opinion as fact and getting lots of press coverage to roil more hatred against "traditional" real estate agents. [T.C. Note: I don't know why the press doesn't wise up and see the chance for promoting good news. I sent a copy of the Realty Times article to the Star / Tribune.]

In fact, the CFA's accusations against the industry were so outrageous, namely that state legislatures aren't protecting consumers and calling for federal oversight of the real estate transaction, that the Association of Real Estate License Law Officials (ARELLO) made a rare press statement of its own.

Among the points ARELLO fired back at CFA:

• By stating that CFA has "no authority or research for this broad assertion that state regulators have failed to adequately inform, educate, and protect home sellers and buyers using brokerage services."
• By explaining the purpose of having licensees on state real estate commission boards -- that more than 800 professions are licensed at the state level and their governing boards are "typically composed of members appointed by the governor of the state, sometimes with the approval of the legislature ... Because licensed practitioners understand the nature and complexity of the industry, the standards of practice, and codes of professional conduct, they are considered uniquely qualified to administer the licensing program and sit in judgment of their peers."
• To CFA charges that some states regulators fail to discipline licensees for discriminatory conduct, ARELLO suggests that "such issues can and have been addressed more appropriately in courts of law."

That’s it for now. Except this:

1. If you have interests or questions, please e-mail me or give me a call.
2. Check out my website HERE

The opinions expressed in this newsletter are solely those of Tom Crone and others being quoted and do not necessarily reflect the opinions of Coldwell Banker Burnet or its affiliates.