President’s Message

Every year real estate organizations nationwide spend millions of dollars on ad campaigns trying to enhance the image of agents and each year state departments of real estate conduct thousands of investigations as a result of complaints filed by the public.

According to a Georgia Department of Real Estate study many of the people who file complaints against real estate licensees, being familiar with the old business dictum: "let the buyer beware," assume they have been victimized and file their grievance with the regulatory authorities rather than make any attempt to resolve the problem directly. It is interesting that only about ten percent of all complaints end in formal discipline of a licensee.

The study shows that most of the complaints involved no violation of the law, which suggests that in most cases licensees do try to operate within legal bounds. In fact, most agents would probably go to great lengths to do the right thing--assuming they knew what that was! Clearly there were many cases where additional education would have helped agents know how to do the right thing.

When the Georgia Real Estate Commission realized that most complaints involved no violation of the law it began to explore the reasons people were filing these complaints. What they found should surprise no one who has been in the business long enough for the ink to dry on their license. It turns out it was poor service that precipitated most of the complaints, for example: not returning phone calls, total lack of communication, lack of common courtesy, agent talking down to clients, showing buyers houses the agent knew was out of their range, rudeness, being late for appointments, showing a house in jogging clothes, etc., etc. Real estate education alone would not eliminate these kinds of complaints. What matters are common courtesy and the values on which we, as independent contractors, "run our business."

So here we are again, at the REALTORS® three most important rules of real estate: 1. Rapport 2. Rapport 3. Rapport. Some of you have asked, "How do we do that?" For those who feel the need of a little memory jog let me close with a few reminders (a "reminder" should be all that's needed since there can't be anyone reading this who doesn't know in their heart of hearts the secret of Rapport):

"Try your best to treat others as you would wish to be treated yourself, and you will find that this is the shortest way to benevolence." Confucianism, Mencius VII.A.4 (6th century B.C.E.)

"No one of you is a believer until he desires for his brother that which he desires for himself." Islam, Hadith V. I, Book II, 7:12 (7th century A.D.)

"This is the sum of duty: do naught to others which if done to thee would cause thee pain." Hindu, The Mahabharata (c.13th Century B.C.E.)

"What is hateful to you, do not do to your fellow men. That is the entire law, all the rest is commentary." Judaism, The Talmud (14th century B.C.E.)

"Hurt not others with that which pains yourself." Buddhism, Udana-Varga 5:18 (6th century B.C.E.)

"Whatever is disagreeable to yourself do not do unto others." Zoroastrianism, Shayast-na-Shayast 13:29 (12th c. B.C.E.)

"Do not do unto others what angers you if done to you by others" Isocrates, c.436-338 B.C.E.

"Do unto others as you would have them do unto you." Jesus Christ, The Bible, Luke 6:31

For those who have more of a scientific than a philosophical bias I offer Newton's Third Law of Motion: "For every action there is an equal and opposite reaction."

It's been a great year. I thank you all for the privilege and honor of serving as your President for 2002. Bon Voyage and Bon Chance!

Bruce A. Southstone, CRB, CRS, GRI

President 2002

Inside

- SCAOR Recognized at NAR Expo

- NAR Postpones MLS Decision

- New REALTOR® Members

- N. Calif. CRS Chapter Program

- Affiliate Member Spotlight

- Federal Bills Pass

- C.A.R. RPA-CA Update

- New Landlord-Tenant Laws

- R.E. Not Immune to Uncertainty

- NAR Housing Opportunity Started

- Election Results Favorable

- SCAOR Calendar

SCAOR Recognized at NAR Expo in New Orleans

The Santa Cruz Association of REALTORS® was recognized by incoming NAR President Cathy Whatley in November at the NAR Annual Expo. in New Orleans. In a speech given at the Leadership Conference, Whatley referred to SCAOR as an example of how local REALTOR® associations are meeting the challenge of providing housing availability opportunities in their communities.

At the October Board meeting, the Santa Cruz Association of REALTORS® Board of Directors approved in concept the creation of the Santa Cruz Association of REALTORS® Housing Foundation. Over the next few months, information will be collected as to how to best move forward in providing assistance in the most effective manner. During 2003, the foundation will be created.

"This is a wonderful opportunity to raise the perception of REALTORS® within the community, as well as to be perceived as part of the solution rather than as part of the problem,” said SCAOR Executive Officer Philip Tedesco.

Stay tuned going into 2003 for continuous updates as to the progress of this important undertaking.

NAR Postpones Decision on MLS Data

NAR deferred a decision on a proposed policy governing the use of multiple listing service (MLS) data by brokers on their Web sites until May 17, 2003, the next scheduled meeting of the association's directors.

NAR also committed an additional $200,000 to fund an education and training program for state associations, local boards and MLSs to help REALTORS® understand the issues involved in the decision. For more information, please visit: http://www.realtor.org/PublicAffairsWeb.nsf/pages/NARNewsReleases?OpenDocument

NEW REALTOR® MEMBERS

Carrie Matiasevich

Bailey Properties, Inc.

Debra Wallace

Karon Properties

Ann McLemore

Monterey Bay Property Management

Don Roberts

Network Alliance Real Estate

Linda delatorre-Herrera

Sherman & Boone Associates

Katrin Tobin

David Lyng & Associates

Billy Gloege

American Dream Realty

Lily Zukowski

American Dream Realty

Shawna Spaulding

Coldwell Banker Jackson & Mann

James Rivoir

John Filighera, REALTOR®

Comments about an applicant’s admittance should be submitted in writing to the Santa Cruz Association of REALTORS®, 2525 Main St., Soquel, CA 95073.

Northern California CRS Chapter 800-277-6003

Northern California CRS Chapter presents...

Pat Zaby

Time for a Marketing Makeover?

Friday, December 6, 2002

Seascape Golf Club, 610 Clubhouse Drive, Aptos (831) 688-5242

Check-in Begins at 8:30 a.m.

Meeting is 9:00 a.m. - 3:00 p.m.

$70/Members $75/Nonmembers (includes lunch)

Affiliate Member Spotlight

Rainbow Carpet One

Contact: Stephen Cooley

110 San Juan Road

Watsonville, CA 95076

Phone: (831) 728-3131

Fax: (831) 728-0266

Cell Phone: (831) 588-2713

Rainbow Carpet One’s five locations are locally owned and operated by the Sturtevant family from Soquel. The year 2002 marks our 34th year in business! We provide professional service, low factory direct pricing, free estimates, quality brand names and full-service guaranteed installations. Rainbow carries in stock 1000’s of yards of carpet, vinyl, hardwood, imported area rugs, and Pergo laminates all perfect for property managers, builders, and real estate professionals looking to upgrade their listings. Ask our real estate specialist, Steve Cooley, about Rainbow’s exclusive REALTOR® Referral Program. Update your listings today and pay for it after escrow. Call Steve’s cell today for details...588-2713.

House Passes Downpayment Simplification and Terrorism Insurance

The U.S. House last week passed the FHA Downpayment Simplification Act of 2002 (S. 2239), which passed the Senate in October. The legislation now goes to President Bush for his signature. The bill makes permanent the FHA downpayment simplification calculation, indexes the FHA multifamily loan limits to inflation using the Consumer Price Index, and repeals the scheduled increase of the Ginnie Mae guaranty fee. All three of these items are linchpins in NAR's legislative agenda to stimulate affordable housing opportunities. The house also approved the Terrorism Risk Insurance Act of 2002 (HR.3210/S.2600), which, for the next three years, would make the federal government the insurer of last resort on property casualty claims that result from terrorist attacks. The bill would insure 90% of the cost of a terrorist attack for losses of $10 billion to $15 billion. President Bush has said he will sign the bill. For more information, please visit: http://www.realtor.org/publicaffairsweb.nsf/Pages/realestatebills

C.A.R.’s New California Residential Purchase Agreement - Resources for REALTORS®

The California Association of REALTORS® recently released an updated version of its residential purchase agreement. The new California Residential Purchase Agreement (Standard Form RPA-CA) is the product of many months of hard work and commentary from REALTORS® across California. While much of RPA-CA will be familiar to REALTORS® currently using its predecessors, RPA-11 and AEPA-11, it incorporates some significant enhancements worth noting, including:

- SIMPLIFIED TIME FRAMES AND EASIER TRANSACTION TRACKING. Sellers will now deliver most disclosures, reports and inspections within 7 days of acceptance. Buyers now have a fixed 17-day window following acceptance to complete their investigations and either remove contingencies or cancel. (Naturally, the parties can agree on different time frames if they want.) No longer will contingency removal time frames be tied to the delivery dates of each separate piece of information in a transaction.

- STRAIGHTFORWARD DECISION MAKING FOR BUYERS. With RPA-CA, a buyer can use his or her 17-day contingency window to assess the desirability of the transaction, and may cancel as needed.

- SAFER CONTINGENCY REMOVAL. With RPA-CA, contingencies are not automatically removed by the passage of time. Rather, contingencies remain active until an affirmative decision is made by the buyer to remove them or cancel, or until the seller elects to cancel the transaction (after first giving the buyer a notice to perform). It is anticipated that this documented contingency removal process will result in fewer unpleasant surprises.

- TWO WAYS TO HANDLE PEST CONTROL. Pest inspections are now treated like most other inspections in RPA-CA, with no pre-report allocation of responsibility for the cost of repairs. By putting the report before the negotiations, buyers and sellers will have better information in hand before attempting to negotiate the cost of pest repairs. (For buyers and sellers who prefer to negotiate pest repairs when they may not yet have a report, C.A.R. offers a more "traditional" pest control clause via the new "Wood Destroying Pest Inspection and Allocation of Cost Addendum," Standard Form WPA, which can be used in conjunction with RPA-CA.)

- COMMISSIONS REMOVED FROM THE BUYER/SELLER AGREEMENT. The agreement between the buyer and seller no longer attempts to cover brokerage commissions, which are now handled outside of the agreement. With RPA-CA, the brokers simply agree to abide by any MLS offer of compensation, or may enter into a separate agreement for compensation. (New "Cooperating Broker Compensation Agreement and Escrow Instruction," Standard Form CBC, lets brokers establish, confirm, or modify commissions on a simple, one-page document.) This should minimize the temptation to try to use the purchase offer to alter pre-agreed commission splits or amounts owed to brokers.

Information on New Landlord-Tenant Laws Available from C.A.R.

California recently enacted two important pieces of legislation--Senate Bill 1403 and Assembly Bill 2330--which make significant changes to a variety of the state's landlord-tenant laws, effective January 1, 2003. Included in the changes are a new 60-day notice requirement for landlords terminating periodic tenancies, written notification prior to entering leased premises, and a pre-termination inspection to allow tenants to minimize security deposit deductions.

C.A.R. has prepared a memorandum detailing these new laws, which is available on C.A.R. Online at http://www.car.org/index.php?id=MzE1MTQ= . For additional information, C.A.R. members may contact C.A.R.'s Member Legal Hotline at 213.739.8282, or 213.739.8350 for Risk Management Program subscribers, office managers, broker/owners, and Designated REALTORS®. Hotline access is also available through online at http://www.car.org .

C.A.R.’s Housing Affordability Index Falls 5 Points in September

The percentage of households in California able to afford a median-priced home decreased by five percentage points in September compared to a year ago, according to a recent C.A.R. report.

The September 2002 Housing Affordability Index (HAI) stood at 28%, down five points from a revised 33% in September 2001, according to C.A.R. The September HAI was unchanged from August 2002, when it also was 28%.

At 66%, the High Desert was the most affordable region in the state, followed by Riverside/San Bernardino at 45%. Santa Barbara was the least affordable region in the state at 14%, followed by Monterey (17%) and the Northern Wine Country (18%).

C.A.R. also reports housing affordability indexes for regions and select counties within the state. For more information: http://www.car.org/index.php?id=OTE0

Experts Caution That R.E. Not Immune to Economic Uncertainty

Although the real estate industry, buoyed largely by the housing sector, has remained stable overall through the economic slowdown, it isn’t immune to the current economic uncertainty and is vulnerable if the economy slips back into a recession, according to industry experts at the Urban Land Institute's recent annual fall meeting.

Predictions for the economy and the real estate industry were provided throughout the meeting by several leading analysts, most of whom concurred that the short-term outlook is clouded by uncertainty due to several factors, including the possibility of war, low domestic job growth, shrinking state government budgets, corporate corruption and shaky consumer confidence. While it's possible that the economy can withstand such a variety of unknowns and stay in a period of slow recovery, it's more likely that the U.S. will re-enter an economic recession, the analysts cautioned. Visit www.uli.org for more information.

Housing Opportunity Program Launched by NAR

NAR has launched a new, comprehensive program designed to empower and encourage the nation's 800,000 REALTORS® to become aggressive advocates for the creation of new affordable-housing opportunities in their own communities. The program is designed to equip REALTORS® with tools they can use, including training, research, communications activities and opportunities to work in coalition with allied interests to promote the construction or rehabilitation of affordable housing projects in their communities.

The program's centerpiece is a Web site (www.realtor.org/housingopportunity) that highlights successful affordable housing opportunity programs, provides tools, and shares resources that REALTORS® and others can use to help promote housing opportunities in their communities. The program also will provide research to help REALTORS® and policymakers better understand housing concerns in their communities, training and business development to educate REALTORS® about the importance of counseling consumers about the full range of housing options, and information about business opportunities in affordable housing.

More than 200 local and state REALTOR® boards and associations already sponsor affordable-housing or housing-opportunities programs. Incoming NAR President Cathy Whatley has urged all REALTOR® organizations to initiate local programs by June 2003, National Homeownership Month. For more info:

http://www.realtor.org/PublicAffairsWeb.nsf/pages/NARNewsReleases?Opendocument

Election Results Favorable To Real Estate Agenda, Says NAR

The 108th Congress will be as favorable to real estate interests as its predecessor--and may be more so, according to NAR political analysts. "Key supporters of NAR-backed legislation have been returned to office and are moving into leadership positions in the new Congress," said Martin Edwards Jr., 2002 NAR president. NAR will be looking to these leaders to press the association's efforts to prohibit big banking conglomerates from getting into real estate brokerage and property management, which would be permitted under a proposal from the Federal Reserve Board and the U.S. Treasury Department. NAR says the change will lead to less competition, less choice, and higher costs for consumers. For more information, please visit: http://www.realtor.org/PublicAffairsWeb.nsf/Pages/ElectionAnalysisConv

Graduate, REALTOR® Institute GRI - 114

Essential Concepts of the C.A.R. Residential Purchase Agreement

Friday, December 13, 2002 at the Santa Cruz Association of REALTORS®

Please call 888/785-4800 for more information

WCR Holiday Luncheon & Silent Auction

Wednesday, December 18, 2002

11:00 a.m. - 1:00 p.m.

$20/Members $25/Nonmembers

West Coast Santa Cruz Hotel

175 W. Cliff Drive, Santa Cruz

R.S.V.P. to Kathy Jo Sera by Friday, December 15

wcrsantacruz@yahoo.com or 831/818-2651

Auction Items Needed - Please Contact Kathy Jo Sera