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Members of the Silicon Valley Association of REALTORS® (SILVAR) are disappointed that the State Senate passed a bill yesterday that will dramatically weaken the Ellis Act in San Francisco, and could serve as a precedent for weakening the law statewide. The California Association of REALTORS® (C.A.R.) strongly opposed SB 1439 (Leno) and SILVAR members lobbied against the measure on Legislative Day this year.
The Senate rejected SB 1439 by a slim margin on Wednesday. Leno then agreed to draft an amendment that would differentiate between small family holdings and speculators. This amendment garnered the votes necessary for the bill to pass yesterday.
C.A.R. sponsored the Ellis Act in 1985. The law allows property owners to evict tenants in order to leave the rental business. SB 1439 would require a landlord to own a building for at least five years before evicting a tenant under the Ellis Act. It would include corporate landlords and apply to all owners of the corporation. Once a property owner submits a request to Ellis Act evict, the law would prohibit them from conducting Ellis Act evictions on any property subsequently purchased.
SB 1439 only applies to the city and county of San Francisco. AB 2405, a companion bill that would have applied statewide, failed to clear the Assembly Judiciary Committee on April 29.
SILVAR members raised multiple concerns about SB 1439 with local legislators on Legislative Day. “REALTORS® explained how this bill would discourage investment in property ownership and could impact selling prices. It would also encourage owners to evict all tenants prior to putting a property up for sale because an empty property becomes more valuable. said David Tonna, president of the SILVAR. “San Francisco already has some of the most protective and expensive eviction rules in the state.”
The bill is scheduled to go before the State Assembly for deliberation this summer.
Fannie Mae and Freddie Mac will not be reducing loan limits, the new director of the Federal Housing Finance Agency (FHFA) announced last week. FHFA Director Mel Watt’s decision not to direct the government-sponsored enterprises (GSEs) to lower the limits for home loans that they back is a major shift in direction of his predecessor, who favored winding down their role in mortgage finance.
The conforming loan limit will remain at $417,000 in most areas and at $625,500 in high-cost areas like Santa Clara and San Mateo counties. Watt also said the agency was taking steps to loosen mortgage credit by easing standards on when banks could be forced to buy back some loans sold to Fannie and Freddie.
A conforming loan limit is the maximum size for loans that can be purchased by government-sponsored enterprises Fannie Mae or Freddie Mac. Mortgages purchased by Fannie Mae and Freddie Mac are generally less expensive than the larger jumbo loans because the government absorbs the cost of default.
Watt’s announcement is good news, especially for California home buyers, said David Tonna, president of the Silicon Valley Association of REALTORS®. “If the FHFA were to lower the loan limits, it would force home buyers to pay more for their mortgages and undermine home ownership affordability. High-cost areas like Silicon Valley are already experiencing shrinking housing affordability,” said Tonna.
The California Association of REALTORS® (C.A.R.) immediately commended the new FHFA director’s announcement. “C.A.R. commends FHFA Director Melvin Watt for his announcement that the FHFA will not reduce loan limits on loans eligible for purchase by Fannie Mae and Freddie Mac,” said C.A.R. President Kevin Brown. “Lower loan limits would have had an adverse effect in many parts of the country, but especially here in California where rebounding home prices and decreasing home affordability would hamper mortgage activity and impact the housing recovery.”
SILVAR President David Tonna and Diane Chandler hand a senior homeowner a complimentary RSVP (REALTOR® Service Volunteer Program) bag, which includes batteries, face mask to protect them from harsh chemicals, and a vial of life, so they can have their complete medical information ready in their home for emergency personnel to reference during an emergency.
Every year in May, SILVAR members visit the homes of seniors who are physically and financially challenged. Members help the elderly with simple household tasks, like replacing light bulbs, changing furnace filters, washing windows, turning over mattresses, changing smoke detector batteries and light yard work.
RSVP is a community outreach project launched by SILVAR in 2001 to assist seniors and the homebound in communities within the Association’s five districts of Menlo Park/Atherton, Palo Alto, Los Altos/Mountain View, Cupertino/Sunnyvale and Los Gatos/Saratoga. The program has expanded on the Peninsula and in the South Bay, with volunteers from neighboring REALTOR® associations helping seniors in their respective communities.
While the SILVAR RSVP volunteers trimmed bushes and weeded her yard, a Los Altos senior homeowner laughingly described herself as being “94 years old and experienced,” and still able to play poker. She expressed her gratitude for the assistance. With only a son living in San Diego, she has no help. She said she has been availing of the REALTOR® service program for the past two years.
“Oh, lordy, I think the program is just wonderful! It’s very fantastic,” she exclaimed.
In Mountain View, an 80-year-old senior resident who lives alone and has no children, said she has requested help from SILVAR REALTORS® for the past five years.
“It’s wonderful that they give up their time to help us. I used to do everything, but it’s the high things I can’t reach,” she said, as RSVP volunteers Jamie Carmichael dusted her home and cleaned her bathroom mirrors, and Stanley Ku trimmed her bushes.
One Saratoga senior homeowner who is riddled with arthritis said she was a volunteer in the community for many years. “Now I am getting it back,” she smiled.
Members of the Silicon Valley Association of REALTORS®, the trade organization representing over 4,000 REALTORS® and affiliate members engaged in the real estate business on the Peninsula and in the South Bay, joined 2,100 California REALTORS® in Sacramento on Wednesday for Legislative Day, where they discuss critical issues that impact home ownership and private property rights with Silicon Valley’s legislators.
At the morning briefing, California Association of REALTORS® (C.A.R.) President Kevin Brown and the C.A.R. leadership welcomed California REALTORS® and thanked them to making the trip to Sacramento. He said, Legislative Day is an opportunity for REALTORS® “to demonstrate the size and power of organized real estate and represent our clients who are not here.”
California Governor Jerry Brown, a special guest at the morning briefing, also thanked REALTORS® for coming to Sacramento. He said it’s been a good year, the budget is balanced and stabilized, but the state still faces issues. Brown said diversity, which is one of California’s great assets, is also its biggest challenge and complicates issues.
“We are working out issues that the whole world has to deal with, but with enough openness, with enough skill, and enough harmony our state is going in the right direction … Wherever we look, California is leading the way,” said Gov. Brown.
“You’re in the right business,” Gov. Brown told REALTORS®. “You sell the California dream and it’s very much alive. Let’s keep it that way. So far, so good. Keep coming back every year.”
Silicon Valley Association of REALTORS® says ... 