The Weekly Membership Newsletter of the Tennessee Assn. of REALTORS
Editor: Pug Scoville

1. Flight 1549 – Lessons for Real Estate
2. Smaller Homes Being Built
3. PODCAST: Forms Changes for 2009
4. HOT LINE: Due a Commission But Retiring a License?
5. HOT LINE: Mineral Rights to the Property?
6. Register NOW for TAR Spring Conference
7. Other Upcoming Events
8. Rates Fall BELOW 5 Percent!

1. Flight 1549 – Lessons for Real Estate

At the end of last week, the nation’s attention was focused on the Hudson River.  The miraculous rescue of all 155 passengers and crew of US Airways 1549, with no fatalities after an emergency landing in a frigid Hudson River, was an incredible and inspiring story.

A combination of skilled piloting, swift reactions from the three flight attendants, and a rapid response from nearby boats and rescue personnel managed to avoid what could have been a tragedy.

The Captain of Flight 1549 — Chesley B. “Sully” Sullenberger — is a former fighter pilot who runs a safety consulting firm in addition to flying commercial aircraft.

Sullenberger, who has flown for US Airways since 1980, flew F-4 fighter jets with the Air Force in the 1970s. He then served on a board that investigated aircraft accidents and participated later in several National Transportation Safety Board investigations.

Sullenberger had been studying the psychology of keeping airline crews functioning even in the face of crisis, said Robert Bea, a civil engineer who co-founded UC Berkeley’s Center for Catastrophic Risk Management.

In other words, he was well-trained and well-prepared to handle anything!

The lesson for real estate? NOW — when the economy has slowed down and you’re not frantically jugging a multitude of buyers and listings — is the best time of all to work on your own training! NOW is the time to acquire new skills, to enhance your know-how, and to prepare yourself for a market and real estate career unlike the ones you’ve enjoyed before now.

Training and preparation helped pull the passengers and crew of Flight 1549 through to safety. They can do the same for you.

2. Smaller Homes Being Built

According to USA TODAY, the “American Dream is shrinking.” Understandably, new construction is at a low ebb, if not an all-time low. Nevertheless, according to a recent article (“New homes being built smaller”), those homes that ARE being built in this sluggish economy are considerable smaller than in years past:

For the first time in at least a decade, builders are substantially reducing the size of new houses.

“We’re trending toward smaller homes,” says Gopal Ahluwalia, director of research for the National Association of Home Builders. He says growth in the average size of new single-family homes, which went from 1,750 square feet in 1978 to 2,479 in 2007, is starting to reverse.

His analysis of Census data shows that homes started in the third quarter of 2008 averaged 2,438 square feet, down from 2,629 square feet in the second quarter. Ahluwalia, who began the quarterly analysis in 1999, says there have been slight dips before, but the latest drop was much steeper and is likely to hold even after the economy recovers.

In a survey of builders this month, his group found that 89% are building or planning smaller homes than they had been.
*** END QUOTE ***

To read the entire article, go HERE.


3. PODCAST: Forms Changes for 2009

As a follow up to last week’s TAR DIGEST, TAR’s Buzz Steele chats with Susan Barnette, a TAR Forms Committee Member and Core Course Instructor, about the latest changes to TAR’s form F9 – the Purchase and Sale Agreement — and some other notable changes to forms. To access this and other TAR Podcasts, go HERE.

NOTE: You can listen to this podcast through your web browser (it’s just over 27 minutes long), access it though iTunes, download it for your iPOD or MP3 player, etc.  …however you choose to access and listen to it!

4. HOT LINE: Due a Commission But Retiring a License?

QUESTION: I have an agent who has earned a commission but needs to place her license in inactive status because of finances. When the property closes, can I still pay her the commission she earned if her license is in inactive status in good standing? I would assign another agent to act as the agent on the final closing.

ANSWER: An agent is deemed to earn their commission when the contract is signed. Therefore, even if their license is inactive or in retirement when the property closes, they will still get their commission IF the agent’s license was active when the property came under contract. However, if the agent’s license was not active when the property went under contract, then that agent cannot be paid the commission. Furthermore, whether the agent is entitled to a commission will depend upon the terms of their independent contractor’s agreement.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

5. HOT LINE: Mineral Rights to the Property?

QUESTION: I have question from a client who has an accepted contract, and all contingencies have been met. He is buying the property AS IS. He recently inquired about the existence of mineral rights on the property, (ie. coal strip mining, digging for phosphate, etc.). I have searched for the information through the deed and the current owner’s title insurance. There is no evidence of any clouds on the title. How much of this research is required of me as a Realtor? Now, the client is requesting a letter at the time of closing stating that there are none of the above-mentioned rights to the property.

ANSWER: First, do NOT promise this buyer that you will find out this information for him. This is outside of your expertise. You can tell him that you will be happy to ask either the seller or the title company to find this information for him. When you get the information, tell him its source.

We would also recommend that you advise him to have his own attorney help him obtain this information and explain what his rights are concerning the property. If the buyer wants a letter at closing, this should be done by the seller and/or the title company. This letter should NOT come from you.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

6. Register NOW for TAR Spring Conference

Online registration is NOW available for the 2009 TAR Education Conference & Trade Show, March 18-19, 2009!  [TAR’s Spring Business Meetings will be held at the same location — the Cool Springs Marriott & Convention Center, just south of Nashville — on March 16-17.]

Education sessions at this year’s Conference include:

  • “New Financing Realities for a New Market” — Chandra Hall
  • “7 Proven Techniques for Marketing Success in a Challenging Market” — Steven David
  • “Holding the Transaction Together When the Market Has Fallen Apart 2009” — Oliver Frascona

To register online, please go HERE.

NOTE: We will NOT offer the 2009-2010 Core CE Course at the TAR Spring Conference or Annual Convention.  The nature of that course simply isn’t a good fit for the large classes that our Conferences and Conventions enjoy.

7. Other Upcoming Events

LEADERSHIP TAR: Registration remains OPEN for all of our 2009 Leadership TAR Retreats, but enrollment will be limited. The schedule is online, along with a program description, HERE, at:

CORE CE INSTRUCTOR LICENSING: Another offering of the 2009-2010 Core CE Course Instructor Workshop (for instructor-licensing) is scheduled for Feb. 4, 2009. More information is available HERE.

REGIONAL LEADERSHIP MEETINGS: A meeting of TAR’s elected leadership and staff representatives with local association leaders has been scheduled in each of Tennessee’s three Grand Divisions for February:
West TennesseeFeb. 12, 1-3PM at the Central West TN Assn. office in Jackson
East TennesseeFeb. 19, 1-3PM at the Knoxville Area Assn. office in Knoxville
Mid-stateFeb 20, 1-3 PM at the Middle TN Assn. office in Murfreesboro

INSTRUCTOR TRAINING WORKSHOP: Our popular 2-day instructor-training program — “The Learning-Centered Instructor” Workshop — is scheduled for March 5-6, 2009. More information is available HERE.

8. Rates Fall BELOW 5 Percent!

Freddie Mac reports that the 30-year fixed mortgage rate fell to 4.96 percent for the week ended Jan. 15 from 5.01 percent the prior week, marking the 11th straight weekly decline.

During the same period, the 15-year fixed mortgage rate edged up to 4.65 percent from 4.62 percent; and the five-year adjustable mortgage rate slipped to a three-year low of 5.25 percent. Additionally, the one-year ARM dropped to 4.89 percent from 4.95 percent.

[SOURCES: Freddie Mac; Information, Inc.]

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