SRCAR Connect

FED CUTS INTEREST RATES BY HALF A POINT
The Federal Reserve today cut a key short-term interest rate by a half-percentage point, the second significant rate cut in just over a week, in an effort to stave off a growing risk of a national recession.

“Financial markets remain under considerable stress, and credit has tightened further for some businesses and households,” the Fed said in a prepared statement. “Moreover, recent information indicates a deepening of the housing contraction as well as some softening in labor markets.”
C.A.R. REPORTS SALES DECREASE 33.4 PERCENT
Home sales decreased 33.4 percent in December in California compared with the same period a year ago, while the median price of an existing home fell 16.5 percent, C.A.R. reported yesterday.

“December is typically one of the slower months for sales, and the liquidity crunch continued to dampen sales beyond the normal seasonal decrease,” said C.A.R. President William E. Brown. “Even so, seasonally adjusted sales edged above 300,000 for the first time since August 2007. The liquidity crunch also contributed to the significant decline in the median price due to the lack of financing options for loans above the conforming loan limit of $417,000. It is imperative that the economic stimulus packaged approved by the House on Tuesday, which includes a proposal to temporarily increase the conforming loan limit, receive swift approval by the Senate.”

Closed escrow sales of existing, single-family detached homes in California totaled 301,040 in December at a seasonally adjusted annualized rate. Statewide home resale activity decreased 33.4 percent from the 452,060 sales pace recorded in December 2006. The median price of an existing, single-family detached home in California during December 2007 was $475,460, a 16.5 percent decrease from the revised $569,350 median for December 2006. The December 2007 median price fell 2.9 percent compared with November’s revised $489,570 median price.

INCREASING CONFORMING LOAN LIMITS PART OF STIMULUS PACKAGE
The U.S. House of Representatives unanimously approved a measure Tuesday that includes an increase in the conforming loan limits as part of a larger economic stimulus package. The measure would allow the Federal Housing Administration and Fannie Mae and Freddie Mac to issue mortgages above the current $417,000 level. Raising the conforming loan limits to more accurately reflect the cost of housing in California and other high-costs areas of the nation has long been an objective of C.A.R.

“While this measure is expected to face an uphill battle in the Senate, Tuesday’s action by the House represents a huge win for Californians and for C.A.R., which has fought aggressively for the increases for several years,” said C.A.R. President William E. Brown.

“For years, Chairman Barney Frank and I have worked to create affordable housing opportunities for families across the country by increasing the FHA and GSE conforming loan limits,” said Congressman Gary G. Miller, who has worked closely with C.A.R. to push for the reforms. “With the average home price in high-cost areas like California exceeding the current loan limit, homeowners and homebuyers in these areas have been unable to utilize these important federal housing programs. The loan limit increases included in the economic stimulus package will make safe, conforming mortgage loans available for homebuyers in all areas of the country.”

REFINANCING SPURS MORTGAGE APPLICATION ACTIVITY
Refinance applications fed an 8.3 percent increase in total mortgage loan activity for the week ending Jan. 18, according to the latest data from The Mortgage Bankers Association (MBA). The MBA reports that refinance applications have climbed 92 percent since the beginning of November, while purchase applications rose 7 percent.

“With tighter credit conditions we do not know how many of these applications will become loans, but it is clear that borrowers are responding to the 40-80 basis point drop in rates we have seen since Nov. 2 across products,” said Jay Brinkmann, the MBA’s vice president of research and economics.

ANDERSON FORECAST PREDICTS RECESSION
Declining home sales and new construction, mounting job losses in the real estate sector, tighter lending practices, as well as a drop in consumer spending and confidence, will lead to a recession by the latter part of the year, according to a new report from the A. Gary Anderson Center for Economic Research.

The report predicts housing starts nationally to hit their lowest levels in 17 years and says the Fed’s interest rate cuts are simply coming too late to “significantly affect overall spending through the first half of 2008,” and unlikely to reverse other negative forces impacting the economy going forward.

“With the inventory of unsold homes increasing sharply and the confidence level of home

builders reaching an all-time low, housing starts are projected to decline for the third consecutive year to approximately 1.1 million in 2008,” the report says. “This would be the lowest level of housing starts since 1991.”

NEW HOME SALES DECLINE 4.7 PERCENT
Sales of new, single-family homes in December 2007 declined 4.7 percent nationally to 604,000, compared with 634,000 in November, down 40.7 percent from December 2006, according to new data from the U.S. Census Bureau and the Dept. of Housing and Urban Development. Nationally, the median sales price of new, single-family homes sold in December 2007 was $219,200; while the average sales price was $267,300. For more information, go directly to http://www.census.gov/const/newressales.pdf.

There was also a sharp decline in homeownership during the fourth quarter of 2007, according to a separate report by the Census Bureau. The report says homeowners accounted for only 67.8 percent of all occupied homes nationally, a 1.1 point decline from the same period in 2006. For more information, go directly to http://www.census.gov/hhes/www/housing/hvs/qtr406/q406press.pdf .

C.A.R. LAUNCHES “MARKET MATTERS” INITIATIVE FOR REALTORS®
In an effort to support REALTORS® and educate consumers about current opportunities in today’s challenging real estate market, C.A.R. has launched “Market Matters,” a multi-faceted campaign intended to provide the tools you need to navigate today’s real estate environment and enhance the image of REALTORS® in the media. The initiative includes a monthly newsletter, weekly e-media advisories, consumer fact sheets, and a host of other tools designed to help REALTORS® address their clients’ concerns about buying a home today.

“Without question, these are challenging times for REALTORS®, made more difficult by the barrage of negative stories about the home-buying process to which consumers are being exposed in print, on TV, the airwaves, and the Internet,” said C.A.R. President William E. Brown. “To that end, the Market Matters initiative will help make sense of what’s happening in today’s market, bolstered by clear, fact-based proof members can pass along to consumers about why now may be an opportune time to buy a home in California.”

For more information go directly to www.marketmatters.car.org.

NAR ISSUES CALL FOR ACTION ON ECONOMIC STIMULUS PACKAGE
NAR issued a call for action today via e-mail urging REALTORS® across the country to send letters to their U.S. Senators in an effort to ensure that the House’s version of an economic stimulus package approved Tuesday, which includes a proposal to raise the conforming loan limit, be left intact.

The Senate is expected to vote on the package Thursday, but there is speculation that the Senate’s version of the measure does not include a plan to raise the conforming loan limit. Both NAR and C.A.R. have waged a long campaign to raise the conforming loan limits for FHA and Fannie Mae and Freddie Mac issued loans. Under the terms of the House package, the conforming loan limit will be temporarily raised from $417,000 to as high as $729,750 in high-cost areas.

C.A.R. is urging all members to respond to this very important e-mail and call for action.

REBS LAUNCHES NEW RESOURCE FOR REALTORS®
C.A.R.’s Real Estate Business Services Inc. (REBS) subsidiary has announced the launch of Clarus™ REsource, a family of new products and services designed to enhance a REALTOR’s® real estate market insight using analysis, training and other comprehensive Web-based tools. The Clarus™ REsource line consists of several components, the first of which, Clarus™ Market Metrics, will be available Feb. 1. For more information, go directly to http://www.car.org/index.php?id=MzgyNDI=.

In addition, REBS has announced its intention to acquire REAL-Mentor, a family of highly effective computer-based solutions that guide real estate agents and their clients through the investment aspects of contemplated real estate transactions. Web-based versions of REAL-Mentor products are expected to be available from REBS beginning April 1. For more information, go directly to http://www.car.org/index.php?id=MzgyNDE= .

C.A.R. PUBLISHES NEW LEGAL ARTICLE ON PRIVATE TRANSFER FEES
Member Legal Services has published a new legal article, “Private Transfer Fees,” which deals with the issue of developer-imposed fees on new subdivisions and the impact of AB 980 on developers, sellers, and REALTORS®. This new article is available on the What’s New and Legal Articles pages of the Legal section on C.A.R. Online (www.car.org), or go directly to http://www.car.org/index.php?id=MzgyNDQ= .

ISSUE UPDATES

NAR Applauds Housing Components in Stimulus Package

“NAR is pleased that the House of Representatives has presented an economic stimulus package that includes important housing provisions,” NAR President Richard F. Gaylord says in a Jan. 24 statement. NAR has been advocating for FHA reform and increasing the conforming loan limits for Fannie Mae and Freddie Mac. An increase in loan limits should provide liquidity to the mortgage market, allowing qualified home buyers on the sidelines to enter the market. In high-cost states, many home buyers with good credit could save $3,000 to $5,000 per year by not being forced into the current jumbo mortgage market.” Gaylord urges the Senate to work with the House and the President to achieve quick enactment of a comprehensive stimulus package.

NAR Welcomes Calif. Governor’s Support for Higher Loan Limits

“NAR commends California Gov. Arnold Schwarzenegger for voicing his support for increasing the conforming loan limits provided by Fannie Mae and Freddie Mac in high-cost areas,” NAR President Richard F. Gaylord says in a Jan. 24 statement. “Gov. Schwarzenegger is the first governor to step up and send a letter to Congress, and in urging them to act, he joins a growing list of influential leaders, including the U.S. Conference of Mayors, expressing concern for the people of California and others affected by high housing costs, to convey the need for immediate federal changes to help restore the health of the real estate market and the national economy.”

Bill Eliminates Flood Insurance Subsidies on Some Houses

The House on Jan. 23 passed legislation (H.R. 3959) to eliminate subsidized insurance rates on so-called pre-FIRM primary residences sold for at least $600,000. In general, pre-FIRM homes are those built or renovated before 1975 or when the initial federal rate map was published for the area under the National Flood Insurance Act of 1968. Under the bill, these home owners would pay annual increases of up to 15 percent in their premiums until they reach their actuarial rate. NAR pressed its opposition to the provision in a Jan. 22 letter to Congress.

 Senate Considers Limit on Some Exchanges

A Senate farm bill (H.R. 2419) includes a limitation on some like-kind exchanges. The proposed modification would disqualify exchanges of “improved real property” with “unimproved agriculture real property.” Thus, the owner of a building could not use the 1031 exchange technique to acquire “unimproved agriculture real property.” The provision would have the effect of imposing a “toll charge” on any person selling property subject to the limitation. The toll charge would take the form of a reduction in the sale price the seller could obtain or the tax that the seller would have to pay as a result of the transaction. NAR communicated its opposition to the provision and is cautiously optimistic that it won’t be included in any final version of the bill.

NAR NEWS

2007 Home Sales Fifth Highest on Record

Existing-home sales declined in December following several months of stable activity. Even so, total sales in 2007 were the fifth highest on record, NAR says. Total existing-home sales, including single-family, townhomes, condominiums and co-ops, slipped 2.2 percent to a seasonally adjusted annual rate of 4.89 million units in December from a pace of 5 million in November. For all of 2007 there were 5,652,000 existing-home sales, the fifth highest year on record. Lawrence Yun, NAR chief economist, says the market is experiencing uncharacteristic weakness. “Home sales remain weak despite improved affordability conditions in many parts of the country, but we could get a quick boost to the market if loan limits are raised in combination with the bold cut in the Fed funds rate,” he says. “Home prices are lower, mortgage interest rates continue to decline and incomes are higher, but many potential buyers are delaying a purchase.”

LEGAL

No Liability for Inaccurate MLS Information

A listing broker wasn’t liable for incorrectly stating in the listing that the property was connected to the city sewer when the property actually had a septic tank, the Court of Appeals of North Carolina ruled, reversing the jury award. The buyers didn’t rely on information prepared by the listing broker, so the trial court should have entered a directed verdict in favor of the brokerage, the court said.

Housing Report

Environment Report

Federal Tax Report

Business Report

Member Legal Services has published a new legal article, REO Transactions: How to Work With Them (January 24, 2008). It is available on Legal’s What’s New and the Legal Articles pages on C.A.R. Online. This legal article deals with all the relevant and topical issues facing listing agents and selling agents working with clients in the sale or purchase of “real estate owned” by lenders.

Dear REALTOR®,

This year, NAR is celebrating 100 years of service to the real estate industry—a milestone few organizations ever see. NAR has achieved the Centennial mark through the collective efforts of you, our Association leaders, and our members. By working all together, we make the “Face of Real Estate.”

Centennial Logo Graphic Standards
In observance of its milestone, NAR has created a Centennial logo that Associations are encouraged to use in their correspondence with members, including brochures and flyers, e-mail newsletters, and more. Click here for graphic standards on the usage of this logo and downloads in a variety of file formats. If you have any questions about the logo, please contact Kim DiGangi.

Face of Real Estate Campaign
We’re also commemorating this historic event with special Centennial mosaics composed of REALTOR® and staff portraits. Please encourage both your staff and members to contribute their photos for inclusion. To upload your photo, click here. The Centennial mosaics are searchable, so you can locate yourself–you just need your NRDS#. Also, coming this week, the mosaic ads and Centennial banner ads will be available for you to print out and use in your advertising.

Centennial Book, Video and More
Enjoy a compelling look back over the last century and the Association’s role in history with a 15-minute video “100 Years in Celebration of the American Dream.” Click here to view the 15-minute video online.

And be sure to purchase your copy of the beautiful and fully illustrated commemorative book “100 Years in Celebration of the American Dream.” Celebrate REALTORS®’ past accomplishments and look forward to the next century of organized real estate.

Click here to order.

Click here to access NAR’s Centennial page, which contains all associated information and details on this year-long celebration.

Events
Watch for more news of Centennial events being planned in the future, including special celebrations at the REALTORS® Midyear Legislative Meetings & Trade Expo this May in Washington, DC.

Thank you for all you do for our members and for helping mark this important milestone.

Have you heard the news? The Inglewood Board of REALTORS®, the Palos Verdes Peninsula Associations of REALTORS®, and the South Bay Association of RELATORS® are joining MRMLS.

This is an exciting time for MRMLS. We will now have 12 member Associations and Boards that service over 36,000 REALTORS®. On the morning of February 4, 2008, you will be able to access listings from Temecula to Arcadia, as well as listings from the Greater South Bay area using MRMLS Matrix.

To properly merge their data with ours, MRMLS Matrix will be unavailable Sunday night, February 3, 2008 starting at 11:00PM. All services will be back up and running by 6:00AM, February 4, 2008.

MRMLS Matrix February Maintenance Schedule:

• Services down starting Sunday, February 3rd, 11:00PM
• All services up by Monday, February 4th, 6:00AM

NEW WINFORMS ONLINE® FORM VIEWER

A new WINForms Online® form viewer was launched last month for enhanced performance and functionality. If you logged into your WINForms Online® account, you were prompted to install it. If you don’t believe that you have upgraded to the newest viewer, you may download it at http://www.winforms.com/online/viewer.html. This new viewer is fully compatible with Windows Vista®.

WINForms Online® allows REALTORS® to access their transactions and templates from various computers with internet access. In order to view the C.A.R. forms on a new computer, one must first download the form viewer. You only need this viewer for WINForms Online®.
WINFORMS® 2008 DESK CALENDAR

Make each month matter with the newest training tool available for WINForms® in 2008. Each month, the Desk Calendar features a useful how-to-tip for using WINForms® software. At a glance, you’ll learn how to create templates, update your software, change contact information, and more! Each calendar features vivid abstract images and a stand-alone desk design. This must-have desk reference makes an ideal gift for new agents and is available for $4.95. To order visit www.store.car.org/mkg/wf2008calendar or call (213)739-8227.

CHANGING YOUR COMPANY INFORMATION OR EMAIL ADDRESS

It’s easy to change your company information listed at the bottom of your WINForms® Desktop and WINForms Online®. For WINForms® Desktop, you’ll first need to find your redemption code. To do this, go to “HELP” in the WINForms® toolbar, then “About”. Your redemption code is on the bottom left. Close your Desktop software and visit www.winforms.com. Next, click the “Change Company Info/Email” link on the top right of the homepage. This will provide you with an update to install.

For WINForms Online®, simply click the Administration link at the top. Then click on Location Manager. You will see your old company listed at the bottom of the page. On the “Select Action” menu to the right, highlight Edit. Make the necessary changes and hit Save. Any new transactions you create will reflect your new company information.

WINFORMS® OPEN FORUM

Don’t miss the WINForms® Open Forum on Wednesday, January 23rd at the C.A.R. Directors’ Meetings in Indian Wells. Forum topics include: breaking WINForms® news; new training products; a preview of the upcoming member benefits Forms Compliance Advisor and Forms Tutor™; and an opportunity to voice your WINForms® recommendations. All directors and Association staff are encouraged to attend, enabling you to relay the latest information to your membership. The meeting will be from 10am until 11am in Crystal Ballroom C Lower Level of the Renaissance Esmeralda.

SOUTHERN CALIFORNIA HOME BUYER’S FAIR

This two-day event is FREE to the public and will include more than two dozen educational “how-to” seminars designed to help home buyers navigate today’s real estate market with confidence and peace of mind as well as 250 exhibit booths.

Where: Los Angeles Convention Center, 1201 S. Figueroa Street, Los Angeles, CA 90015

When: Saturday & Sunday, April 12th-13th, from 9am-6pm

Sponsored by the Los Angeles Times and the CALIFORNIA ASSOCIATION OF REALTORS®.

Notice the field titles are not abbreviated in the new Agent Full Report shown below:

Member Legal Services has published a new legal article, Legal Update, January 16, 2008. It is available on Legal’s What’s New and the Legal Articles pages on C.A.R. Online. This legal update summarizes several new laws for 2008 as well as several important real estate cases in 2007.