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April 1, 2011

REALTORS® Urge Congress To Preserve Mortgage Interest Deductibility

With talk growing in the nation’s capitol about future modifications to the mortgage interest deduction (MID), the National Association of REALTORS® is asking all members of the U.S. Congress to become a co-sponsor of H.Res25, a bipartisan House resolution that affirms the value and importance of the MID.  Earlier this week, NAR issued a member-wide Call for Action (CFA) via e-mail urging REALTORS® to write to their Congressman asking them to sign on as a co-sponsor of H.Res25 and oppose any legislation that would modify or undermine current tax law governing the mortgage interest deduction.

You may recall that last December a commission appointed by the Obama Administration to reduce the federal budget deficit recommended several revisions to the current MID rules.  Specifically, the commission has proposed converting the mortgage interest deduction to a tax credit, capping eligible mortgages at $500,000, and eliminating the MID for second homes and home equity loans. 

To participate in the CFA, REALTORS® simply need to access the March 28 e-mail from the REALTOR® Action Center and click on the “Take Action” button to send a pre-drafted letter to their Congressman stating the REALTOR® organization’s belief that preservation of the MID is necessary to avoid destabilizing the housing recovery underway in the U.S. 

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NAR Announces New Initiative to Promote Property Rights, Home Ownership

The National Association of REALTORS® has announced a new Political Survival Initiative intended to ensure the organization’s success in the public policy arena.  This initiative is a direct response to the changes in federal election campaign finance laws passed last year which now allow corporations to contribute significantly larger sums of money to support candidates for elected public office. 

As presented, this initiative will require an investment of nearly $39 million according to NAR, and a majority of it – two-thirds by NAR estimates – will be made available to state and local REALTOR® associations to fund issues campaigns (similar to the one held last year in Massachusetts to defeat the ballot question to outlaw the state’s comprehensive permit law, Ch. 40 B), as well as opportunity races for candidates for office backed by the REALTOR® organization.  NAR Leadership has proposed a $40 dues increase (from $80 to $120) for 2012 and 2013 to fund the REALTOR® Party Political Survival Initiative, and will present the proposal to the NAR Directors for their consideration on May 14 in Washington, D.C.

In advance of the vote by the NAR Board of Directors, the GBAR Board of Directors will discuss this issue at its meeting on April 11 and recommend a position on the Political Survival Initiative to the association’s two current NAR Directors -- GBAR President Deborah Heffernan and immediate past president Mel Martocchia.  To provide for an informed decision, all GBAR members are invited to log in and participate in our online survey to cast a vote and provide feedback on the REALTOR® Party Political Survival Initiative.

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FHA Mortgage Insurance Premium Set to Increase in April

The U.S. Department of Housing & Urban Development (HUD) has announced an increase in the monthly mortgage insurance premium for Federal Housing Administration (FHA) loans as of mid-April.  The increase of 25 basis points will apply to loans with case numbers assigned on or after April 18, 2001, HUD revealed in Mortgagee Letter 11-10.  The increase, which is opposed by the National Association of REALTORS®, is the third in the last 12 months and will cost the average buyer an additional $30 per month or $360 per year, according to NAR.  The increase is necessary to restore the FHA’s finances which remain under a required 2 percent reserve, agency officials said.  Existing borrowers will not be impacted.  Also, the upfront mortgage insurance premium will remain unchanged at 1 percent.

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Winter Storms, Financing Issues Slow Boston Area Home Sales in February

Severe winter weather early in 2011, along with higher mortgage rates and a lack of financial incentives – such as last year’s federal home buyer tax credit – took a toll on the housing market in February as buyer demand softened from January and the same month one year ago.  Sales of detached single-family homes declined 7 percent from February 2010 and were down 24 percent from January 2011.  Last month’s sales volume was the second lowest for the month of February in the past 15 years.  Meanwhile, condominium sales eased for the seventh time in the last eight months on an annual basis, decreasing 16.5 percent in February compared to the same month last year.  In addition, condo sales slid 14.6 percent in February from one month earlier.  Pending sales also fell in February from the comparable period a year ago, declining 14 percent in the detached single-family home market and 24 percent in the condo market.

With fewer buyers in the market, it took nearly one month longer (27 days) for homes to sell this February vs. February 2010.  The monthly median selling price of detached single-family homes also declined for just the second time in the last 16 months on an annual basis, slipping 3.7 percent in February from the same month last year to $380,000.  Condominiums also took longer to sell this past February compared to the same month a year ago, as average market time increased nearly three weeks (20 days) over the past 12 months.  However, in somewhat of a surprise, the median selling price for condominiums rose 6.7 percent over the past year to $349,000 in February 2011 due to healthy sales activity among high-end buyers in the luxury condo market.

To view all of last month’s data and to get a more detailed analysis on the housing market in greater Boston, visit the Monthly Housing Reports page on gbar.org.

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Home Affordable Refinance Program (HARP) Extended to June 2012

A federal program aimed at helping homeowners who have lost equity in their home refinance to keep their house has been extended for another 12 months.  The Home Affordable Refinance Program (HARP) was set to expire on June 30, 2011, but will now continue to operate through June 2012.  Only borrowers with a loan-to-value ratio of between 80 and 125 percent who are current on mortgages already owned or guaranteed by Fannie Mae or Freddie Mac are eligible for HARP assistance.   In announcing the program extension, officials with the Federal Housing Finance Agency stated that GSEs will continue to provide refinancing for qualified borrowers without requiring additional mortgage insurance and that Freddie Mac will exempt refinanced loans from recently announced price increases.  In addition, Fannie Mae has agreed to extend its loan eligibility date by five months and will now consider HARP refinancing of loans made on or before May 31, 2009.

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Revisions to Fannie Mae Rules Could Complicate Condo Sales

A recent revision to Fannie Mae loan guidelines that took effect on March 1st could make it more difficult for condo owners to sell their units.  The change, which is detailed in Fannie Mae’s Selling Guide, makes clear that mortgage loans in progress on a condo involved in most types of litigation will be declared ineligible for delivery.  Specifically, the guidelines stipulate that “any project (condo, co-op or planned unit development) for which the homeowners association or co-op corporation is named as a party to pending litigation, or for which the project sponsor or developer is named as a party to pending litigation that relates to safety, structural soundness habitability or functional use of the project remains ineligible” [for Fannie Mae project approval or financing].  This small, but significant change is one homeowners associations (HOA) will need to pay attention to since issues resulting from poor workmanship could lead to disputes between a condo owner and the HOA over financial restitution for repairs that cause one or more parties to pursue a lawsuit against the builder or a contractor.  And that would be problematic in terms of obtaining Fannie Mae approval.         

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Apply Today to Become a REALTOR® Community Observer

The Greater Boston Real Estate Board (GBREB) is seeking members who are interested in acting as the association’s “eyes and ears” in their community by monitoring issues of real estate industry sensitivity and alerting association staff when appropriate.  The role of a REALTOR® Community Observer is principally an informative one, and not one of advocacy.  It is to stay abreast of hot local issues, such as those that will impact homeownership, housing affordability, private property rights and real estate development, and submit reports notifying the association about proposed local ordinances, bylaws and “home rule” legislation that are relevant and meet the scope set forth by GBREB and its Government Affairs Committee.  Applications for REALTOR® Community Observer are being accepted through April 15.  Members may seek an appointment as an observer to a community(ies) in which they live and/or work, and must be willing to attend an orientation session scheduled for May 9 at the GBREB offices in Boston.  A detailed overview of the role of a REALTOR® Community Observer, including official duties and responsibilities, and the application form are available online at gbar.org.  For questions, call GBREB Government Affairs Director, Patricia Baumer at 617-399-7858.

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Volunteer Opportunities Available for REALTORS® at Boston Homeowner Event

BOSTON HOMEOWNER EVENT

The U.S. Department of Treasury and HUD are partnering with the HOPE NOW Alliance and NeighborWorks America® to bring a free foreclosure prevention program to Boston and REALTORS® are being sought as volunteers to assist at the day-long event.  The program, which is being presented as part of the Obama Administration’s Making Home Affordable Program, will be held on April 28, from 11 a.m. to 7:30 p.m. at the Hynes Convention Center in Boston.

The primary purpose of the event is to bring homeowners in financial distress together with a representative from their mortgage lender and/or local housing counselor for a face-to-face meeting.  Volunteers are needed to assist with registration, directional guidance, exit surveys, translation, and general program coordination.  Interested persons may sign-up to volunteer for one or more four hour shifts available.  They are as follows: 9:30 a.m. to 1:30 p.m., 1:00 to 5:00 p.m., and 4:30 – 8:30 p.m.  Volunteers will receive an event t-shirt and be provided complimentary food and parking the day of the event.   For questions or to express interest in serving as a volunteer, contact Sheila Squier via e-mail at Sheila.squier@gmail.com.  Those interested in volunteering should provide their name, e-mail address, office/company of affiliation, languages spoken other than English, and shift(s) you would be willing to attend.

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Weston REALTOR® Named Finalist for REALTOR® Magazine “30 Under 30” Feature

Joanne Paleo Taranto

Joanne Paleo-Taranto, a sales associate with Gibson Sotheby’s International Realty in Weston, has been named one of 50 finalists to be featured in REALTOR® Magazine “30 Under 30” class of 2011.  Now in its 12th year, REALTOR® Magazine’s “30 Under 30” feature spotlights 30 young real estate professionals under the age of 30 who have demonstrated an entrepreneurial spirit, dedication to the industry, and a high volume of sales success at an early age.  Past GBAR members profiled in this feature include Michael Dimella, of Charlesgate Realty in Boston, Jessica Ye, of Keller Williams Realty in Cambridge, and Suzanne Koller, of Keller Williams Realty Boston in Concord. Those chosen for this year’s class will be featured in the June issue of REALTOR® Magazine.

A REALTOR® since 2006, Paleo-Taranto is a past chairperson of the GBAR Community Service Committee, and has also served on the association’s Communications and Strategic Planning Committees.  We invite you to view her profile and cast your vote for her as recipient of the “30 Under 30” Web Choice Award. Voting is open until Saturday, April 2 at midnight.  Good luck Joanne!

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