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All REALTORS® MUST COMPLETE ethics training between the January 1, 2017 and December 31, 2018 cycle or be suspended by NAR.

The National Association of REALTORS® (NAR) requires that every REALTOR®, in order to maintain membership in the Association of REALTORS®, must complete a 2 1/2 hour Code of Ethics course every two years. This means all REALTOR® MUST COMPLETE the ethics training at some point between the cycle of January 1, 2017 and December 31, 2018. Failure to comply with this required ethics training is a violation of a membership duty and will result in suspension and possible termination from the member’s primary Association.

It is this mandatory ethics training and membership with NAR that differentiates REALTORS® from real estate agents. Although both are real estate licensees, REALTORS® proudly display the REALTOR “®” logo on the business card or other marketing and sales literature. REALTORS® are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate.

REALTORS® can take the ethics training online through NAR. It’s easy and it’s FREE. Visit NAR CODE OF ETHICS ONLINE for more information on online classes and this mandatory NAR requirement. Code of Ethics training is also included in CalBRE license renewal requirements, so if a member has renewed their license between January 1, 2017 and December 31, 2018, their Code of Ethics requirement is covered.

If you have already taken Code of Ethics training for this period outside of California license renewal, via NAR or the California Association of REALTORS® (C.A.R.) or elsewhere, please email a copy of the certificate to your primary Association. If you are a member of the Silicon Valley Association of REALTORS® (SILVAR), you can email a copy of your certificate to membership@silvar.org before the deadline of December 31, 2018. The next compliance cycle will start January 1, 2019 and end on December 31, 2020.

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On Wednesday, the Internal Revenue Service issued proposed regulations for a new provision allowing many owners of sole proprietorships, partnerships, trusts and S corporations to deduct 20 percent of their qualified business income. The new qualified business income deduction is available for tax years beginning after December 31, 2017. Taxpayers can claim it for the first time on the 2018 federal income tax return they file next year.

According to the National Association of REALTORS® (NAR), the deduction will have a significant, beneficial impact on members. NAR believes this deduction, which is included in the IRS and Treasury Department’s release of proposed regulations, will be available to a wide range of real estate professionals, including those who are self-employed, as well as those operating through partnerships, LLCs, and S corporations. NAR will continue thoroughly reviewing the rule and will be releasing more information when the process is completed.

SEE IRS SUMMARY

SEE IRS RULE

NAR TAX REFORM SUMMARY AND RESOURCES

Although year-over-year home sales have fallen for the second consecutive month, appraiser Roger Miller with Taketa Miller & Associates recently told members of the Silicon Valley Association of REALTORS® that they shouldn’t be too concerned about recent changes in the housing market.

The housing market is “doing just fine overall,” said Miller.

In fact, Miller said this is the longest period of appreciation he has witnessed in his 40 years in business and he believes it will continue for a while.

Homes have appreciated an average of 20 percent in Silicon Valley. Miller indicated the year-over-year median home price is up 23 percent in Los Gatos and up 23 percent in Saratoga. In Mountain View, the median is up a whopping 25 percent, in Cupertino 19 percent, and in Sunnyvale and Los Altos 17 percent.

Miller said inventory has increased, but sales are down in some places and days on the market have lengthened from an average of seven to 10 days to one month in some areas. It’s not a bad thing, said Miller. It just means the market is settling down.

Watch the specific micro market you are in, said Miller. In places closer to Apple and Google, homes are still selling at a quick pace. In Cupertino, a 2,700 square foot home sold for $2.36 million in just nine days. In Sunnyvale, a $1.9 million home sold in nine days. In Mountain View, a 1,400 square foot home priced at $2.3 million sold in eight days.

The Silicon Valley appraiser said the market usually slows down from the second week of May because of graduations and summer vacation. With the school year starting earlier this year, he expects it to heat up again around the second week of August.

“Take a vacation and be ready to come back in mid-August,” Miller told the REALTORS®.

Miller said the local economy is especially good, with Google’s plans of expanding to San Jose. Unless the giant companies like Facebook, Apple, Google, LinkedIn and eBay are transported somewhere else, he believes the housing market will stay hot for some time.

“I don’t see the market coming down in a while. It’s a little down, but even as it settles down, it will settle down at a higher price,” said Miller.

It is important for REALTORS® to learn about Propositions 13, 60 and 90 and two propositions that will be on the November ballot, Propositions 5 and 10, because they are the first person consumers go to for information about housing.

Approved by California voters in 1978, Proposition 13 caps the maximum amount of the assessed value of real property to one percent and limits property tax increases to no more than 2 percent per year as long as the property is not sold.

Propositions 60 and 90 stem from Prop 13. Prop 60 allows anyone over the age of 55 to transfer the base year value of their original residence to any replacement residence of equal or lesser value in the same county. Prop 90 extends these provisions to a replacement residence in a different county that accepts Prop 90 transfers. Homeowners must buy the replacement home within two years of selling the existing one, or vice versa.

Propositions 60/90 are incentives for senior homeowners to downsize and move into smaller, less expensive homes without being penalized with a higher property tax. The counties that accept Prop 90 transfers are Alameda, El Dorado, Los Angeles, Orange, Riverside, Santa Clara, San Bernardino, San Diego, San Mateo, Tuolumne and Ventura. El Dorado is dropping out effective November 7.

Proposition 5 is the California Association of REALTORS®’s Property Tax Fairness Initiative and would allow seniors to transfer their tax assessments from their prior home to their new home anywhere in the state and as many times as they wish. The transferred property tax benefit would apply through a proportionate formula whether or not a senior homebuyer purchases up or down in price. C.A.R. estimates the passage of Prop 5 would provide more liquidity in the market and free up 43,000 transactions.

Those opposed to Prop 5 claim it would mean a $150 million a year in lost revenue to the state budget, but according to REALTORS® this analysis does not take into account the property tax increases that might occur when the original homes are sold and assessed at a higher tax rate; nor does it take into account the economic benefits of having someone move into a new community.

Proposition 10 would repeal the Costa-Hawkins Rental Housing Act, which limits the use of rent control in California and allows landlords to increase rent prices to market rates when a tenant moves out. This proposition would allow local governments to adopt rent control ordinances and rules on how much landlords can charge tenants for renting apartments and houses. Cities will be free to impose rent control on any residential unit, including single-family homes and new construction. This proposition would lock in low rents and dissuade investors from building much needed housing in the state.

C.A.R. is supporting Prop 5 because it would be good for housing, and actively opposing Prop 10 because it would hurt housing.

 

The National Association of REALTORS® (NAR) is warning its members about a phishing scam they may receive in an email appearing to be under the REALTOR® Party banner. The scam email is asking to help “Jim” with a financial donation. Please be aware that the email is not from the REALTOR® Party or NAR. Please delete this email if you see it.

NAR will never solicit donations for personal or individual charities. All donations go through the REALTORS® Relief Foundation.

Anyone who received the email or sent money to the link in the email should file a complaint with the FBI’s Internet Crime Complaint Center at http://www.ic3.gov.

NAR urges its members and state and local REALTOR® associations to be on high alert for email and online fraud.

The California Bureau of Real Estate (CalBRE) officially became the California Department of Real Estate (DRE) effective July 1, 2018. The DRE has been re­-established after five years as a bureau under the Department of Consumer Affairs.

All telephone, email and website contacts will remain the same. Licensees can use the department’s eLicensing system to reprint license certificates reflecting the change to a department, but will not receive new pocket cards unless their license is being renewed.

Licensees will not be required to change their business cards or marketing materials to reflect the change, as long as their license numbers remain on those materials.

To learn more, visit http://www.dre.ca.gov.

“No one is 100 percent secure when it comes to cyber security. We just have to do our best keeping our private information confidential and secure when doing business,” said Nicholas McGowan at the Cyber Security Lunch and Learn at the Silicon Valley Association of REALTORS® this week. McGowan is a sergeant at the Petaluma Police Department, a member of the San Francisco Crimes Task Force and the Bay Area chapter of the High Technology Crime Investigators Association. He also has established Brainwave Hack Consulting Services.

Cyber security is a concern for anyone who connects to the internet. “A hacker just has to be right once,” said McGowan, and this is why you have to be diligent about keeping your private information secure. Cyber criminals seek to identify and retrieve passwords, dental and medical records, bank accounts, credit cards and government identification.

McGowan said your password is your first level of defense from hackers, so you need a most secure password for your email and other important accounts. McGowan suggests a password with no less than five and preferably 12 characters and resetting your password every few months.

Use anti-virus software and make sure it is updated. The best protection is to have a multifactor authentication.

In offices or even your home, McGowan said it is not safe to have a shared network because it is vulnerable to being hacked. Business emails can be compromised. Have your own personal or business network and a separate network for guests.

Stay away from open networks in airports, malls and coffee places. “They are a cyber criminal’s dream,” said McGowan.

Phishing with links in emails is rampant. Links can contain viruses which could be a source of ransomware. Ransomware is only bad if you run it, so do not click on a link, even if the email purportedly comes from a credit card company or bank. Go directly to the company’s website and access the information from there.

“If it doesn’t feel right, trust your gut. Never click on a link,” said McGowan.

 

Bees may be pests to some people, but they are important to agriculture. One third of the world’s food supply is pollinated by bees. Without bees to keep plants and crops alive, the world will not survive. Members of the Silicon Valley Association of REALTORS® recently learned of this sobering thought from beekeeper and honey bee location expert, Art Hall. Hall asked the REALTORS® to relay the information to homeowners, stressing the importance of bees to the world’s survival. The honey bee, which is the most endangered bee, is responsible for over $30 billion a year in crops.

Beekeeping originally started in Egypt in 2400 B.C. European beekeeping began in the 1300s. There were no honey bees in America until the Europeans brought bees to Virginia in 1621. Hall said today there has been an increase in backyard beekeeping as more people become aware of their threat of extinction.

Hall removes bees from homes, backyards, and commercial structures for a fee. He warns it is not enough to just kill bees with spray, as their remnants create spores of black mold, which destroys structures and is also a mandatory disclosure. Bees need to be removed, the area of their location, if a structure, then needs to be cleaned, sealed and calked.

Hall donates the bees he removes to the 4-H, the Future Farmers of American, and anyone who will prove that they will keep the bees alive and not kill them.

The beekeeper stressed the world needs to save honey bees because they pollinate hundreds of plants upon which livestock feed. Bees help create billions of dollars of increased yield. He noted one fruit tree grower said bees can mean a difference of 40 to 50 percent increase in yield.

Bees are dying due to a phenomenon known as Colony Collapse Disorder, which occurs when the majority of worker bees in a colony disappear and leave the queen behind. Other reasons are parasites, imported bacteria, and pesticides.

To protect the bee population, homeowners can reduce pesticide usage, support local beekeepers, plant year-round forage and tell neighbors and friends about the importance of their survival.

 

 

The National Association of REALTORS® is calling on Congress to act now to reform and extend the National Flood Insurance Program, which is set to expire on July 31. Allowing the deadline to lapse would deny necessary insurance coverage to homeowners and buyers in more than 20,000 communities nationwide.

The NFIP provides up to $350,000 of flood insurance coverage for federally-backed mortgage in 22,000 communities nationwide. It also provides an alternative to taxpayer-funded disaster assistance. While there is a growing market for private flood insurance, for many, the NFIP continues to be the primary source of asset protection against flooding, the most common and costly natural disaster in the U.S.

In November last year, the House of Representatives passed the NAR-supported 21st Century Flood Reform Act, which contains numerous important provisions for consumers. The Act reauthorizes the NFIP for a full five years, avoiding the uncertainty of short-term extensions and potential shutdowns and provides guidelines for creating better flood maps for the program. It limits maximum flood insurance premiums to $10,000 per year for residential properties, and directs FEMA to develop more granular rate tables to ensure fewer properties are overcharged by the NFIP. The bill sets aside $1 billion for flood mitigation assistance grants and increases access to private market flood insurance, which often offers better coverage at lower cost. The bill also addresses issues with repeatedly flooding properties that account for 2 percent of NFIP policies and 25 percent of claim payments over the history of the program.

The bill is now in the Senate. NAR is urging the Senate to act quickly. The last time the NFIP expired, approximately 1,400 home closings were interrupted each day until the program was reinstated. In all, the program has lapsed on a number of separate occasions for two months combined with a total of 23 separate short-term extensions.

Earlier this week, the California Association of REALTORS® (C.A.R.) sent out a Red Alert to members about reaching out to their Assembly members and urging them to oppose AB 2364. C.A.R. is pleased to announce that AB 2364 FAILED last night on Assembly Floor. The bill only secured 25 YES votes, with 34 voting NO and the remainder Not Voting. All members of the Assembly were present, so those not voting did so intentionally.

C.A.R OPPOSES AB 2364 (Bloom and Chiu), which deters property owners from returning to the rental housing business for 10 years. The passage of AB 2364 would have significantly weakened the Ellis Act by discouraging new rental housing investment and would have ultimately made the state’s housing crisis even worse.

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