The 11-22-11 Newsletter of the Tennessee Association of REALTORS
Editor: Pug Scoville

1. New Home Buyer and Seller Survey Released!
2. What Do Successful Agents Have In Common?
3. Congress Raises Ceiling on FHA Loans
4. HOT LINE: Disclosure Exemption for Short Sales?
5. HOT LINE: Husband Won’t Sign Property Disclosure?
6. HAPPENINGS – Nov. 22 Through Dec. 9
7. Rates Tick Up To 4
8. Useful Web Links
9. No TAR DIGEST Next Week

To ask a TAR Legal and Ethics Hot Line question, CLICK HERE.

For other questions about this newsletter, please use the “CONTACT” form HERE.

1. New Home Buyer and Seller Survey Released!

Recent home buyers are staying well within their means with notably higher incomes and modestly higher downpayments than buyers in the previous year due to the restrictive mortgage credit environment, despite historically favorable housing affordability conditions. This was one of several findings in the 2011 Home Buyer and Seller Survey, just released at the 2011 NAR Convention in Anaheim.

Seventy-eight percent of recent home buyers said their home is a good investment, and 45 percent believe it’s better than stocks. According to survey results, most buyers believe in the long-term value of home ownership.

The study shows the median age of first-time buyers was 31 and the median income was $62,400, up from $59,900 in the 2010 study. The typical first-time buyer purchased a 1,570 square foot home costing $155,000; the estimated median monthly mortgage principal and interest payment was $794. The typical repeat buyer was 53 years old and earned $96,600, notably higher than the $87,000 median reported in the 2010 profile. Repeat buyers purchased a median 2,100 square foot home costing $219,500, with an estimated median payment of $1,006.

The median downpayment for all home buyers was 11 percent, ranging from 5 percent for first-time buyers to 15 percent for repeat buyers. “The downpayment size for both repeat buyers and first-time buyers was a full percentage point higher than in the 2010 study, another indication of tighter lending requirements,” Paul Bishop, NAR vice president of research, said.

Eighty-nine percent of respondents used real estate agents and brokers; this was the most common method to purchase a home. Other methods include directly from a builder, 7 percent; and directly from the previous owner, 4 percent. Sixty percent of buyers working with real estate professionals were represented by a buyer’s agent.

When buyers were asked where they first learned about the home they purchased, 40 percent said the Internet; 35 percent from a real estate agent; 11 percent a yard sign or open house; 6 percent from a friend, neighbor or relative; 5 percent home builders; 2 percent a print or newspaper ad; 2 percent directly from the seller; and less than 1 percent from a home book or magazine.

Ninety-one percent of home buyers who used the Internet to search for a home purchased through a real estate agent, as did 70 percent of non-Internet users, who were more likely to purchase directly from a builder or from an owner they already knew in a private transaction.

To access a complete summary of survey results, CLICK HERE.

[SOURCE: NAR Research]

2. What Do Successful Agents Have In Common?

A recent survey of 1,758 real estate agents by ActiveRain reveals that agents earn an average of $55,000 to $65,000 per year, with 22 percent earning more than $100,000 and 21 percent under $35,000. Nearly half (47 percent) are male, and respondents had worked in real estate for six to 10 years on average.

The survey found that the most successful agents devote up to $5,000 annually on technology — specifically IDX Web sites, CRM, lead management, and e-mail newsletters. Of these agents, 91 percent use Facebook, 84 percent use LinkedIn, 65 percent use Twitter, 65 percent use, 62 percent use ActiveRain, and 52 percent use WordPress, among other social media tools. Respondents as a whole use these social media tools similarly or less often than successful agents.

As for marketing, most agents spend roughly $1,000 to $3,000; but successful agents shell out $5,000 to $10,000 in this area. Successful agents devote 62 percent of their marketing budgets to direct mail, 29 percent to local newspaper ads, 26 percent to online advertising agencies, 26 percent to SEO/blogging, 21 percent to search engine clicks, and 18 percent to online leads. Respondents said personal referrals, blogging, and B2B (Business-to-Business) professional referrals are the most effective.

To read more, CLICK HERE.

[SOURCES: RealtyBizNews; Information, Inc.]

3. Congress Raises Ceiling on FHA Loans

This past week Congress reinstated the loan limit formula and maximum cap for Federal Housing Administration-insured loans for two years.

The provision reinstates the FHA loan limits through 2013 at 125 percent of local area median home prices, up to a maximum of $729,750 in the highest cost markets. The floor will remain at $271,050. The loan limits for Fannie Mae- and Freddie Mac-backed mortgages will remain at 115 percent of local area median home prices, up to $625,500.

NAR believes the reinstated loan limit formula and cap change will help make mortgages more affordable and accessible for hard-working, middle-class families throughout the country, not just wealthy individuals or those in costly markets. Nearly two-thirds of buyers who will be helped by the loan limits provision have incomes below $100,000.

The bill also provides for a short-term extension of the National Flood Insurance Program through December 16, 2011. NAR strongly urges Congress to use the additional time to complete work on a five-year reauthorization of the program, which ensures access to affordable flood insurance for millions of home and business owners across the country.


4. HOT LINE: Disclosure Exemption for Short Sales?

QUESTION: I have an agent who is working a short sale transaction. The buyer has agreed to accept a property exemption form in lieu of the TN Residential Property Disclosure. The listing agent has stated that, due to the fact that this is a short sale, neither form is required. Is this correct?

ANSWER: NO. A short sale is NOT one of the items listed on the types of transactions exempted under the Tennessee Residential Property Disclosure Act. Some foreclosures are, but short sales are not. The list of exempted property is contained at Tenn. Code Ann. 66-5-209, and exemptions are also listed on the Exemption form itself. A Disclaimer can be used, but only if the buyer approves.

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

5. HOT LINE: Husband Won’t Sign Property Disclosure?

QUESTION: I have two clients who were married but are now divorced. The wife was awarded the marital home until her son graduated high school, and upon his completion of high school they agreed to sell the home. My client has signed the disclosure statement, but the husband will not sign it because he has not lived in the house in the past four years. Legally what options do they have and what should I advise them to do?

ANSWER: If the husband refuses to sign it, then simply obtain the wife’s signature on the document. Make a note in the file which explains why you only have the wife’s signature on the disclosure form. Please note that, if the parties have questions about what they are required to do, then they should speak with their own legal counsel.

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

6. HAPPENINGS – Nov. 22 Through Dec. 9

Happy Thanksgiving, everyone!

Nov. 29: Homeownership Options for Tennessee’s Workforce (6 hrs. CE and 6 hrs. GRI elective credit) – WCAR Office, Brentwood. For more information or to register, call 615-771-6845.

Dec. 1: 2011-2012 Residential Core Course (6 hrs. CE) – GNAR Office, Nashville. For more information or to register, call 615-254-7516.

Dec. 6: NAR Ethics Course (3 hrs. CE) – CAR Office, Clarksville. For more information or to register, call 931-552-3567.

Dec. 6: Professional Standards Procedures Training (3 hrs. CE) – CAR Office, Clarksville. For more information or to register, call 931-552-3567.

Dec. 7: Agency in Tennessee (4 hrs. CE) – CAR Office, Clarksville. For more information or to register, call 931-552-3567.

Dec. 7: Leadership Conference for Local Associations Presidents and Presidents-elect – TAR Office, Nashville.

During the month of December, The CE Shop (our partner for online courses) is offering TAR members 25% OFF Online Continuing Education courses! This promotion starts December 1st and ends December 31st. Use the Promo Code DEC25. To access courses, go to:

For information on the NEW 2012 GRI Program, go to:

Watch each week’s TAR DIGEST for schedule changes and additions!

7. Rates Tick Up To 4

Freddie Mac reports that average interest on 30-year home loans ticked up to 4 percent from 3.99 percent a week earlier. Meanwhile, 15-year fixed mortgages averaged 3.31 percent compared to 3.30 percent; and one-year adjustable-rate mortgages drifted up to 2.98 percent from 2.95 percent. Five-year ARMs bucked the upward trend, however, slipping to 2.97 percent from 2.98 percent. The Mortgage Bankers Association adds that loan demand fell 10 percent on a week-over-week basis.

[SOURCEs: Freddie Mac; Information, Inc.]

8. Useful Internet Links

Click on any of the following to access:

Back Issues of the TAR DIGEST
Tennessee Assn. of REALTORS
TAR Education
TAR on LinkedIn
TAR on Facebook
Follow TAR on Twitter
Online Risk Reduction Resources
Online Resources for Association Leaders
Tennessee Real Estate Commission

9. No TAR DIGEST Next Week

Due to staff travel, the TAR DIGEST will not be published next week, but it will return with the Dec. 6 issue!