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GBREB strives to ease the Massachusetts Housing Crisis

The Greater Boston Real Estate Boards continues to work on the issue of producing housing at all price points as a solution to an issue that confront so many people in the Greater Boston area, and especially inside of Route 495. The Commercial Divisions of the Board see this as an issue as they look at market conditions because without adequate housing, the ability of companies to grow and prosper in Massachusetts will be affected which will ultimately impact commercial rental rates. Residential members see a problem of inventory at sale prices that many working families can afford.

As a solution the Greater Boston Real Estate Board has been working for several years with the Legislature and the Mayor of Boston to advance policies that can produce the much-needed housing stock, both in the "for sale" inventory and for rental units as well. The Board is supporting the housing proposal filed by Governor Baker in December of 2017, which will not solve the problem entirely but will help move the Commonwealth closer to a solution. Massachusetts is in a great economic position with a highly skilled workforce, so let's hope that our greatest export is not our hard-working citizens who will be forced to exit because they have no place to live.

Massachusetts Housing Crisis


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On March 22nd, the Massachusetts House of Representatives approved legislation regulating short term rentals. 

Prior to passage of the bill, an important amendment was offered by Representative Kevin Honan (D-Brighton) at the request of the Greater Boston Real Estate Board (GBREB) and adopted. The primary concern GBREB officials had expressed with the bill was that it appeared to confer tenancy rights on short-term occupants. GBREB believes that it is crucial that this statute clearly provide that licensees or lodgers are not to be treated as “tenants” and shall not be entitled to any rights or protections afforded pursuant to state law.

The adopted amendment clarifies the status of short term occupants and ensures that they are not inadvertently afforded tenancy rights. In addition, the amendment clarifies that an owner would not be responsible if a tenant were to use the premises for short-term occupancy. Rather, it would be the responsibility of the person offering the apartment for short-term use to collect the taxes and comply with the Statute. An amendment clarifying that provisions of chapters 186 and 239 relative to real estate and summary process would not apply to short term rentals was ultimately adopted. 

Additionally, the Massachusetts Association of REALTORS®- which opposes the legislation- had offered two amendments which did not get accepted. The first amendment, sponsored by Dan Cahill (D-Lynn), would clarify language to ensure that REALTORS® who collect rent and taxes from renters would be able to pass those funds on to the owner, without incurring any tax filing obligations. The second amendment, sponsored by Representative Tackey Chan (D-Quincy), would strike a provision that would allow cities and towns to restrict short-term rentals by passing by-laws or ordinances that would include a limit on the number of days an owner may rent out a home or requiring that each home is an owner’s primary residence.
House Votes To Approve Short Term Rental Legislation
Do you know a great REALTOR®? A rock star affiliate member? A distinguished industry veteran? If so, please consider nominating them for one of GBAR's Member Recognition Awards! Each year we recognize our members for their active volunteer involvement, charitable acts, and business success with our five awards: Good Neighbor, Affiliate of the Year, Andrew F. Hickey Distinguished Service , REALTOR® Spirit and REALTOR® of the Year Awards. 

We know that we have many outstanding REALTORS® and Industry Affiliates in our association, and we’re counting on you to help us identity and celebrate them at our Annual Awards Breakfast, which will be held on Friday, June 22 at the Venezia Restaurant in Boston. Please save the date and visit the Awards Nominations page to learn more about each award and submit a nomination today! All members can submit a nomination and the nomination process ends on May 1.
Help Us Recognize Our Best!
Earlier this week, MassHousing announced the launch of a new down payment assistance program which will help make homeownership more accessible to more prospective homebuyers and allow qualified first-time homebuyers to finance up to 100 percent of the purchase price of their first home, as opposed to the current financial assistance rate of 97 percent.

This program is available to low-, moderate- and middle-income buyers throughout the state and is MassHousing’s response to the record-low inventory levels, rising home prices, high rents and student loan debt that has become a statewide issue. 

“MassHousing’s new down payment assistance program will help ensure that homeownership remains accessible to working families, by allowing creditworthy homebuyers to buy their first home with little to no down payment requirement,” said MassHousing Executive Director Chrystal Kornegay said. “By boosting the buying power of low-, moderate- and middle-income households, MassHousing will support investment in neighborhoods, help the state’s workforce remain rooted in Massachusetts, and advance the Agency’s mission of confronting housing challenges facing the Commonwealth, to improve the lives of its people.”

The program still maintains some of MassHousing’s standard requirements, including a minimum credit score, debt-to-income qualifications and prospective homebuyers must attend a homeownership education class. Additionally, there are annual household median income limitations of:
$103,400 in eastern Massachusetts
$85,700 in Worcester County
$67,200 in Berkshire County 
MassHousing Announces Down Payment Assistance Program
On Monday March 5th the Cambridge City Council rejected enacting local by-laws that would restrict the sale of property by a vote of 6-3. Specifically, the measure proposed creating a right of first refusal that would allow tenants to join together and purchase their residential building should their landlord decide to sell. Cambridge City Councilors who opposed the measure were Mayor Marc C. McGovern, Vice Mayor Jan Devereux, Craig A. Kelley, Alanna M. Mallon, E. Denise Simmons, and Timothy J. Toomey, Jr.

The Cambridge proposal was similar legislation pending at the State House, Bill H. 3017, An Act to Preserve Affordable Housing Through a Local Option Tenant’s Right to Purchase.
GBREB has strongly opposed H.3017 which is modeled after the Tenant Opportunity Purchase Act (TOPA) law in Washington D.C.  The Greater Boston Real Estate Board (GBREB) has raised numerous objections to the creation of a right of first refusal law including complicating loans and clouding title insurance, complicating previously routine transfers of interest among individuals, families or business entities that own housing and delaying the sale of homes and multifamily property.

Although, H.3017 was referred to a study at the State House effectively stopping progress of the bill for this session, discussions are still ongoing in Somerville on how to advance the issue locally.

Click here to read more about the vote.
Cambridge Rejects Tenant Right of First Refusal on Mutli-Unit Property Sales
This year, GBAR has partnered with The CE Shop, the leader in online real estate education.  We know our members' time is valuable and trying to stay on top of business and family priorities can be a challenge--especially as your license expiration date nears.  

That's why we've partnered with The CE Shop--to give you more flexibility and control over how to meet your Continuing Education requirements.  All our members benefit from our co-branded course website. This means you have a one-stop shop that lists the course subject and describes each in full detail, so you know what's offered before you enroll. Visit the GBAR CE Shop website at any time to review and purchase the courses you want.  You can start your course immediately or come back to it later. 

The CE Shop's courses not only provide the most relevant and current information, and are delivered in user-friendly language, but you can pause and bookmark any time where you left off in a course.  Return to your learning environment when you have the free time to do so. Visit the CE Shop today and check out the site and to leverage our partnership's monthly promotional discount for Greater Boston REALTORS®.

Don’t forget as a GBAR member, you also have access to free CE webinars, called Manageable Mondays offered once each month. Visit our education & events page for details on upcoming webinars.
Create Your Own Schedule with The CE Shop
We have all learned that there is only one way to say the word REALTOR® correctly.  Some of us have been chided into correcting our pronunciation from three syllables to two (REAL-tor, not REAL-i-ter or REAL-a-ter), but once you learn the right way to say REALTOR®, you never forget.  The same applies to use of the REALTOR® trademark and logo.  Once you learn how to use them properly, you begin to notice when others don’t, and how such improper use dilutes the value of our brand.

How Well Do You Know the REALTOR® Trademark?

Members of the National Association of REALTORS® are licensed to use the marks and logo relating to their real estate business.  “Real estate business” includes real estate brokerage, property management, real estate appraising, land development and building.  See how much you really know about the REALTOR® marks and logo by taking this short quiz.

The rules for proper use of the REALTOR® marks and logo apply to any and all media.  Whether the marks are used on signs or newspaper ads, letterhead or flyers, websites or e-mails, the rules remain the same. Members may only use the REALTOR® marks and logo in connection with their name and the real estate business to identify themselves as members of NAR. A short video produced by NAR explains this very well.

The long and short of it; if you can replace the word “REALTOR®” with the word “member” and the meaning stays the same, you are using the mark correctly.  The correct use of the term “REALTOR®” must always include the registered trademark (not copyright) symbol and be capitalized.  The term “REALTOR®” means “member of the National Association of REALTORS®”.  It is therefore, not appropriate to say that you are a “Professional REALTOR®”; an “Experienced REALTOR®”; or a “True Realtor” (sic) as this dilutes the power of the trademark and does not correctly distinguish you as a member of the National Association of REALTORS®.  Similarly, writing “Jane Deerfield, Commercial REALTOR®” would not be correct.  A correct way to write this would be “Jane Deerfield, REALTOR® - specializing in Commercial Real Estate.”  Thus, if the word “member” cannot logically be substituted for the term “REALTOR®”, use a clarifying phrase instead.

Additional information and tools can be found at GBAR members are encouraged to help educated their fellow REALTORS® in ensuring compliance with the guidelines described above.  Questions, comments or complaints about improper use of the REALTOR® marks and logo can also be directed to the GBAR Brokerage Counseling Hotline at 617-399-7869.
Improper Use of the REALTOR® Trademark Dilutes Its Value

REALTORS® should be aware that negotiations through text and email may bind clients to an agreement. Therefore, great caution should be used when communicating through these means unless the agent has the "express actual authority" to bind their client through such means. Express actual authority means that the client has explicitly indicated through words and/or actions that the agent may act to bind the client. Such actions may be verbal, but preferably should be documented in writing.

"Apparent authority", which is determined by analyzing the actions of the client and whether those actions would cause a third party to reasonably believe that the client intended to be bound by the actions of the agent, is why extreme caution should be used when negotiating via text and email as you may bind your client into an agreement; irrespective of whether or not there was intent to do so - thereby creating potential liability for the client and the REALTOR® agent.

If it has been determined that an agent does in fact have the authority to bind their client, the electronic communication must still satisfy Massachusetts law and the statute of frauds in order to be binding. The statute of frauds is a legal doctrine that requires contracts for the sale of land to include all essential terms and be in writing signed by the party against whom enforcement is sought. Emails or text messages from an agent laying out the specific terms of a deal may be sufficient to satisfy the requirements of the statute of frauds. In fact, even incorporating by reference to a document containing the essential terms may be sufficient.

Two recent court cases support this assertion. In 2012, the Massachusetts Superior Court ruled in Feldberg v. Coxall that the parties could be bound if the material terms of the agreement were present and the parties had the requisite intent to enter into the agreement. Furthermore, it held that signature blocks in emails could meet the signature requirement. In May 2016, a Massachusetts Land Court ruled that a series of text messages can satisfy the Statute of Frauds and bind parties to a real estate transaction.

The 2016 case, St. John's Holdings, LLC v. Two Electronics, LLC , involved a dispute between two businesses for the purchase of a commercial property. Over the course of several weeks the parties negotiated an unsigned "Binding Letter of Intent" through their respective brokers via email and text messages. Included in an email exchange, which included the brokers’ respective email signatures, was an email from the listing broker stating that the seller was "ready to do this." The listing broker then followed up with a text message to the buyer’s broker, telling the buyer to sign the Letter of Intent, as prepared by the seller, and submit a deposit, which the buyer did. Some of the text messages included signatures on a first name basis, but not all of them did. During these negotiations, however, the seller received and accepted a higher offer from a different buyer and refused to sign the Letter of Intent with the buyer. Immediately, the buyer sought to enforce the Letter of Intent in a Massachusetts Land Court, arguing that the Letter of Intent was binding based on the exchange of emails and text messages between the real estate brokers and included all material terms of the contract. The seller, on the other hand, argued that the text messages were merely negotiations and further, did not include the required signature from the seller.

The judge sided with the buyer, ruling that the text messages, in addition to the emails, satisfied the statute of frauds and amounted to a binding contract. In reaching his decision, the judge considered all of the email and text messages as whole. "Under the Statute of Frauds, multiple writings relating to the subject matter of the agreement may be read together as long as the writings, when considered as a single instrument, contain all the material terms of the contract." Additionally, he held that the signatures in the text messages were enough to authenticate the seller: "Typing their names at the end of certain messages containing material terms, but declining to do so for more informal discussions, is indicative that the parties chose to be bound by those signed communications."

What REALTORS® Can Do to the Protect Themselves
Unless a client has expressly authorized you to make an agreement on their behalf, REALTORS® should consider including a disclaimer at the bottom of emails that include proposed terms for an agreement. Adding a disclaimer, such as: "Nothing in this email is intended to create a binding contract for the purchase or sale of real estate. The sender of this email does not have authority to bind a client [buyer or seller] to an agreement via written or oral communications, including by email." when it accurately describes the agent’s authority, will avoid unintended consequences of email communications.

When communicating through text message, it is wise to make similar statements in the beginning of the negotiations. An even wiser approach would be to discontinue negotiating terms through text messages all together.

Can an Email or Text Message from a REALTOR® Bind a Client to a Transaction?

Did you miss our March Newsletter? Read about upcoming BOMA Boston events, news, and educational opportunities!

Read the March BOMA E-News

March E-News


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