President Calls for More Re-fi Opportunities

Posted on February 6, 2012 by

In his State of the Union address President Obama mentioned his latest plan to revitalize the housing industry. The program would give responsible homeowners the chance to save $3,000 a year ($250 a month) by refinancing. He said the modifications to the existing HARP (Home Affordable Refinance Program) would make the program more accessible – without the red tape and costs of a traditional refinance.

The Wall Street Journal says that the President’s newest proposal would require Congressional action to make the changes broadly available to homeowners who don’t have Fannie and Freddie-backed loans. Under the plan, homeowners would be able to refinance into new loans backed by the Federal Housing Administration. The proposal would also allow borrowers who have more than 20 percent equity in their homes to qualify. Currently, HARP is only open to borrowers with less than 20 percent equity.

NAR offered careful support for the President’s proposal, saying it stands ready to help with any effort to streamline the mortgage refinance process. Beyond that, NAR calls for making the struggling housing market a national priority, because until housing recovers, the economy can’t revive. “REALTORS® believe that more must be done to stem the rising inventory of foreclosed homes and address the lack of available and affordable mortgage financing, which is inhibiting a meaningful housing market recovery,” said NAR President Moe Veissi.

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False Transfer Tax Email Circulating AGAIN

Posted on February 6, 2012 by

It’s back… An email that began circulating in the spring of 2010 is making the rounds again. At that time Congress had just passed the “Obamacare” health bill.

An opinion piece in the Spokane, Wash., Spokesman-Review reported inaccurately that the health care bill contained a provision for a 4.0 percent “sales tax” or “transfer tax” on the sale of a home. This was seized upon by conservatives and spread across the country.

NAR responded quickly, pointing out that the bill, whichbecomes law in 2013 imposes a 3.8 percent Medicare tax for some high-incomehouseholds that have “net investment income.” Any revenue collected by the tax is dedicated to the Medicare hospital insurance program.

The email gained credibility because it was simple and the explanation was complicated. There is no expiration date on Internet so the email keeps going around and round. If you receive an email that begins, “If You Own a Home” or “Homeowners Listen Up!” be suspicious. NAR’s Mythbuster brochure is available here: http://www.realtor.org/small_business_health_coverage.nsf/pages/small_business_health_coverage

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Legislative Update

Posted on February 6, 2012 by

The Legislative Policy Committee took positions on a variety of bills at its latest meeting. Here are some of the most interesting bills and CAR’s position on them:

HB-1164 “Severed Mineral Rights” CAR Position – Oppose. This bill would require a new real estate disclosure notice regarding whether the mineral estate has been severed from the surface estate. The bill would put the responsibility for the disclosure on the seller, creating an additional, unnecessary expense. The LPC opposes this unnecessary mandate. Any buyer can request a minerals title search if desired. This bill is sponsored by Realtor® Marsha Looper, a representative from El Paso County.

SB-81 “Local Government Sprinkler Requirements” CAR Position  – Support. The 2009 Model Residential Building Code included a provision requiring sprinklers in most new residential construction. This bill would prohibit local governments from requiring that provision. The LPC supports this bill because it does not believe government should place mandates on builders and because of the cost of sprinklers for new home buyers. SB-81’s sponsors include several legislators from Northern Colorado, including Sen. Scott Renfroe (Greeley) and Rep. Kevin Lundberg (Larimer County).

HB-1110  “Appraisal Management Companies” CAR Position – Support. This bill, which was initiated by the Division of Real Estate, would regulate appraisal management companies. The federal government requires AMC regulation as part of the Dodd-Frank banking reform bill. In addition to ensuring that AMC employees are licensed and regulated, the bill would also provide consumer protection by establishing transparency on appraisal costs.

HB-1165 “Disclose Radon Hazards” CAR Position – Neutral. This bill would require radon testing (and the disclosure of the results) by the seller prior to sale. Obviously this bill opens a whole can of worms. CAR is in a difficult position, and the feeling of the LPC is that it would create negative publicity if CAR openly opposes it. Staff is currently working behind the scenes to make the bill more palatable or preferably, ensure that it does not pass out of committee. HB-1165 is sponsored by Democratic legislators from Jefferson County.

CAR to Convene Continuing Education Task Force: The Grand Junction Association of Realtors® recently wrote a letter to CAR President Scott Matthias concerning the insufficiency of current Colorado continuing education requirements (24 hours for every three year cycle). The letter suggested that 12 credit hours per year would be a better standard (one update courseplus an elective). CAR’s leadership discussed this proposal and shared it with the LPC. President Matthias and his leadership team decided to convene a task force to discuss the issue later this year.

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Code Compliance Task Force Begins Review

Posted on February 6, 2012 by

In 2007 the City changed the way nuisance code violations were handled by “decriminalizing” the violations and creating an administrative hearing process. These codes cover concerns such as trash, weeds, off-street parking and zoning code matters like landscaping, fencing, signs, etc.

However, the Council has received some complaints from property owners and managers who’ve raised concerns about the fairness of the enforcement process. In response a nine-person citizen committee has been convened to assist with an audit of the program services associated with nuisance code enforcement. Mike Ramstack (Pro Realty) and Barbara Koelzer (Government Affairs Director) represent GARA on the citizen committee, which is expected to present its findings to Council in April.

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City Tightens Policy on Unpermitted Residential Construction

Posted on February 6, 2012 by

Loveland’s policy concerning illegal or unpermitted home renovations has become more restrictive, thanks to an interpretation by City Attorney John Duval. Tom Hawkinson, Chief Building Official for the City, said it was Duval who advised the Building Division to adopt a stricter policy in the wake of a well-publicized lawsuit in Pitkin Countyconcerning carbon monoxide alarms.

In that particular case, the tragic deaths of a family of four by carbon monoxide poisoning led to a lawsuit against the building official who has inspected the home as well as the company that installed the alarms. Duval told Hawkinsonthat to avoid liability, Loveland should take a stricter, more uniform approach in making decisions concerning renovations done without permits.

This change in policy is creating problems for real estate transactions involving unpermitted work. If confirmation is required by a buyer, a lending institution or an insurance company, that construction was done in compliance with the building code, it can lead to the necessity of an inspection by a City building official. If the inspector finds violations, correcting the problems can bevery expensive depending on the type of work that was done. Hawkinson said projects that include any electrical, plumbing, foundation or load bearing walls raise safety issues, requiring the removal of drywall to for inspection.

Other local jurisdictions take different approaches to the situation. Chief Building Official Chris Allison of Longmont said that a letter from a licensed contractor and a final inspection is generally adequate to legalize unpermitted construction. He said he couldn’t remember any situations in which sheetrock had to be removed. In Greeley Chief Building Official Tim Swanson also said as long as the work was done by a licensed contractor and passes an inspection, the permit is issued although Greeley does double the charge of the permit fees in these cases. Larimer County has a policy for “as-built” work to allow homeowners to obtain permits after work is completed. Licensed contractors must review the work after which the County issues an as-built certificate. Candice Phippen, the County’s Building Code and Compliance Supervisor said she hasn’t heard of cases in which the as-built certificate wasn’t satisfactory in these circumstances.

Note: This issue will be the main topic at the Loveland-Berthoud Association of Realtors® monthly membership meeting on Feb. 9. A representative from the City of Loveland’s Building Inspection Division will discuss the issue and answer questions.

Posted in Gov't Affairs, Larimer County, Loveland | Leave a comment

Development Overlay District Postponed

Posted on February 6, 2012 by

Staff’s proposal to encourage infill and redevelopment in certain parts of the City received a cold reception at a recent City Council study session. The Planned United Development Overlay District, known by the irritating acronym of PDOD, is an optional tool offering greater flexibility and extended vesting rights (5 years versus 3) for developers.

However, the four Councilmembers present (Councilmembers Manvel, Poppaw and Kottwitzwere absent) didn’t seem to understand the proposal and got bogged down in the details. Did the extended list of options on the performance matrix confusethem? The matrix was designed to give developers flexibility and track sustainable aspects of a project for the good of the community. It would provide points for sustainable development practices, transit oriented development design, etc. Ironically one of Council’s criticisms was that it would be difficult to measure the success of PDOD, so perhaps the intent of the matrix was not clear.

Additionally, the PDOD process was supposed to encourage and reward more public input on development proposals. But several Council members, Gerry Horak and Kelly Ohlson in particular, said the staff should have elicited more input on the proposal from residents, insinuating that input from the Chamber of Commerce, the Fort Collins Board of Realtors® and a variety of the City’s citizen committees and boards wasn’t adequate. Staff was directed to gather more input from citizen and neighborhood groups before the proposal moves forward. The PDOD ordinance, which staff had hoped to bring before Council for first reading on March 6th, was postponed until the public outreach process is completed.

Posted in Fort Collins, Gov't Affairs, Larimer County | Leave a comment

Council Considers Transportation Funding Idea

Posted on February 6, 2012 by

At a recent study session City staff and the Transportation Advisory Board (TAB) again brought up the need for additional revenues to pay for road & bridge infrastructure, saying the funding gap is approximately $3 million. One solution, which hasbeen considered and rejected by Council in the past, is a transportation fee. However, the City Council continues to feel uncomfortable with that concept. Unlike a tax, the fee would not require a public vote and could be added to utility bills, which is why non-elected transportation officials like the idea. The TAB has suggested a set fee for single-family homes and a larger fee for businesses based on their size. This would be easy to administer. It’s harder to envision how a transportation tax would be calculated, especially in Boulder where socially conscious voters might not like a one-size-fits-all tax that could be considered regressive.

The timing of bringing such a measure to the voters is tricky. For one thing, RTD may add a FasTracks tax increase to the ballot in 2012 and the Council would not want to place two transportation tax questions on the same ballot.

Councilman Macon Cowles supported the concept of a tax but went even further,  suggesting that parents of open-enrolled students should be taxed at a higher rate since they tend to drive more (ouch!). New Council member Suzanne Jones suggested the City research a community-wide Eco-pass program. Other Council members prudently suggested that other funding options should be pursued before the idea of a transportation tax. The study session was just the beginning of the discussion and the decision making process is in its early stages, especially if the Council decides to wait until 2013.

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