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Real Estate Associations

Good news for Realtors – extended tax deadlines (thanks, NAR!)

(REAL ESTATE) NAR fights for their members, and this time they got extended payback for taxes, which many were uncertain about.

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A rising tide lifts all boats, and if you’re sailing the goodship Realty, the seas just got a little bit less choppy.

Obviously in the wake of COVID-19, it’s a bit of an understatement to say we all could use some help. The unprecedented scale and spread of the virus is leaving a jaw dropping number of people without cash flow, and the splash back came for the housing market and professionals therein pretty much immediately.

Fortunately, the National Association of Realtors has been sharpening their politician poking stick (metaphorically) and advocating hard to get things done at a legislative level with the IRS and US Treasury Department (literally).

The IRS has extended much-needed relief in regards to payment of 1031 like-kind exchanges and opportunity fund investments, both intended to serve the underserved. Individuals and corporations alike can now breathe easy on making payments until July 15, leaving a 60 day breathing period for filing, and a month for actual payment before penalties racked up.

With 1.4 million members of NARs, and 9.5 million American jobs in the housing market on the line, the feds made the right decision to put out a helping, fee-free hand. It stands to reason that in times of crisis, including levels of unemployment unheard of since the Great Depression, that putting the screws to people and demanding blood from hopefully sanitized stones isn’t the best idea.

After all, I’m pretty sure a standard pitchfork IS compliant with the CDC’s six-feet-away requests. And in the off chance that we’re still riding the ‘rona wave into the summer (looking at YOU, defiant Barton Springs gatherers, looking RIGHT at YOU), this does bode well for setting a kinder, gentler precedent for the housing market in the future.

Breathe easy, realtors of the world…just not too close to anybody else.

You can't spell "Together" without TGOT: That Goth Over There. Staff Writer, April Bingham, is that goth; and she's all about building bridges— both metaphorically between artistry and entrepreneurship, and literally with tools she probably shouldn't be allowed to learn how to use.

Real Estate Associations

NAR Report: Realtor trends across demographics reveal interesting consistencies

(REAL ESTATE ASSOCIATIONS) The latest report from the National Association of Realtors digs into all kinds of demographics to reveal what brought folks into the field.

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Realtors across demographics looking at data on laptop with papers scattered across desk.

Data makes the world go round. Money does as well, but that isn’t the main point today. Data also comes in many different forms. Points of connection between two seemingly different things can pull together planets (seriously, that’s how gravity functions). Understanding how those things come together is how you can access the world around you in new and interesting ways. From that train of thought, then, knowing your demographics in business can give you insight into a vast realm of possibilities.

Starting in 2017 the National Association of Realtors, America’s largest trade association with 1.4 million members, did a deep dive into their members. They took a look at not only their financial accomplishments but their genders, orientations, races, and even personality traits. Some of their other questionnaires seem to even delve into personal life decisions. The resulting inferences create an intriguing picture across demographics.

So, are you a Gemini, who can split their personality in two? Maybe you’re a Taurus whose stubborn streak makes a glacier seem fast when it comes to changing your mind. An essential piece of someone, their personality. Knowing the personality attributes that can help someone be successful in a job is exceedingly beneficial. You can plan out a path ahead of time before jumping into something without knowing if it’ll work out. Through their surveys, NAR discovered that 62% of residential realtors chose their own career path. The vast majority of them proclaim that being self-motivated is a must to be successful. Other skills such as people skills, communication, and problem-solving actually rank lower while still being needed. Think about that for a moment. You need to be self-motivated to go out and do this job, but all of these successful people basically confirm that “It is mandatory to self-motivate”. Without this skill, you will not thrive.

NAR also did an analysis on how people got interested in real-estate in the first place. These numbers definitely reflect a corresponding link with the personality analysis. Less than 25% of people who answered the survey were brought into real-estate by someone else. This reveals yet again that self-motivated people are the ones who succeed across demographics.

But what they found is that the main draws of the job were also common. Being your own boss helps a majority in the commercial groups. Controlling your own workday with flexible hours was what pulled people into the more residential real estate. Both of these factors again lend towards a driven individual with a strong work ethic.

Interestingly, a lot of variation was found between demographics when it came to income comparisons between races. According to the NAR vice president Jessica Lautz “income may be lower as the typical home price in a neighborhood is lower, for other they may work only part-time and others may be new to the profession and have no ownership in the firm.” The associated numbers involved reveal that White/Caucasian members have the highest median gross personal income and then subsequently we have Asian/Pacific Islander, Hispanic/Latino, and Black/African-American.

There was also a correlation between the White/Caucasian group and the Black/African-Americans that showed that the former also used real-estate sales as their main or only source of income. Whereas the latter had the highest percentage of people who only used it as a part-time occupation. Having a second job to bring up their overall income. Racial lines also seem to be divided by different types of real-estate. Hispanic/Latino and White/Caucasian were much more likely to be in the suburbs. Asian/Pacific Islander seem to focus in small towns or rural areas. Black/African-American members showed their greatest areas as urban or city sites.

An interesting mound of data was the statistics around LGBTQ+ people that came of this. The information showed that these members were focused in the urban or city areas at almost 50% more than their heterosexual counterparts. These members also spoke highly of some extra skills needed to succeed in this career. Sales and marketing acumen were something that was rated very high on their lists, surpassed only by superior communication and problem-solving skills. This group also surpassed their counterparts in both median number of residential transactions (4-5) and sales volume ($1.6 million – $1.3 million).

A lot of the different aspects of these surveys creates a picture of the type of person who would do well as a realtor. If someone is a self-starting, determined, and an excellent communicator then they’d have a spectacular start. They would have to put in effort for marketing and build a network but it’s a start.

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Real Estate Associations

NAR introduces meaningful tools and training to stop implicit bias

(REAL ESTATE ASSOCIATIONS) The NAR has been taking steps forward to erase implicit bias, and recent events have made this that much more important. You should also take steps.

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The National Association of Realtors® is demonstrating its commitment to addressing housing discrimination and racial injustice through an Implicit Bias Training video that is being distributed to members. The online video proposes to “give (real estate agents) the tools to help override the effects of implicit bias. This means that the next time (they) work with clients from other cultures and backgrounds, (they) will be in a position to provide equal professional service, because (they) have embraced the work we all need to do to treat everyone fairly.” This 50-minute video is just one part of NAR’s work to reduce discrimination in housing.

The NAR is committed to fair housing

This video isn’t just a kneejerk reaction to the recent protests. In January, the NAR leadership announced a plan that emphasized Accountability, Culture Change, and Training (ACT) to protect housing rights, and uphold fair housing standards in the NAR’s code of ethics and in United States law.

Housing discrimination and implicit bias

In 1968, Congress passed the Fair Housing Act, which outlawed discrimination based on race, color, or national origin pertaining to housing. The Act has been strengthened over the past 52 years, but enforcement is still inconsistent. The problem isn’t that people are explicitly biased, but that there are many barriers and practices that are leading to continued housing segregation.

One practice that the NAR is responding to is implicit bias, which is an unconscious bias that affects how you interact with others. Consciously, you might never discriminate against another race, but you may unintentionally react differently with another race than you would with someone of the same race. This might manifest itself in many ways as a real estate agent. The Kirwan Institute or the Study of Race and Ethnicity research suggests that implicit bias can be showing black buyers fewer homes than a white homebuyer, even if they are pre-qualified.

Check your biases

The NAR is doing more than simply changing its social media status in light of #BlackLivesMatter. The NAR is working for real change for fair housing. I’d encourage you to watch the entire video to really understand implicit bias in real estate, and how it affects everyone. You can examine your own implicit biases through Project Implicit, a research collaboration project. We aren’t going to end housing discrimination through legislation without real reform by the people who act as guides into the real estate industry.

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Real Estate Associations

NAR and other industry groups call for caution before ending conservatorship

(REAL ESTATE ASSOCIATIONS) The National Association of Realtors joins industry groups to urge the Treasury to avoid a rushed end to conservatorship.

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A metal globe in New York City representing government conservatorship

The National Association of Realtors (NAR) joined the Mortgage Bankers Association (MBA), the American Bankers Association (ABA), and the National Association of Home Builders (AHB) in voicing their concerns about a rushed effort to end the conservatorship of Fannie Mae and Freddie Mac.

In response to the financial and housing crisis of 2006 through 2008, the Federal Housing Finance Agency (FHFA) placed Fannie Mae and Freddie Mac (government-sponsored enterprises, or GSEs) into conservatorship in September 2008. To stabilize the firms, the Treasury gave the companies a $190 billion lending package. In return, the Treasury would receive senior preferred shares, and Fannie Mae and Freddie Mac would be required to make quarterly dividend payments to the Treasury, among other things.

It’s 12 years later now, and FHFA’s Director Mark Calabria’s top priority is to remove the company from government control and place it back in private hands before President Trump leaves office. And, the housing industry associations argue abruptly ending the conservatorship of Fannie Mae and Freddie Mac could destabilize the housing market.

In a letter to the U.S. Treasury Secretary Steven Mnuchin, the housing industry associations said, “We are concerned that other potential actions to release the GSEs from conservatorship without the necessary safeguards would undermine investor confidence, create volatility in the single-family, and multifamily mortgage markets and impede access to credit for consumers.”

“During conservatorship, investors have relied on the Treasury backstop of the GSEs, which totals over $250 billion, as well as the effective control of the GSEs by the federal government.” By ending the conservatorship with the GSEs without anything in place, the groups say it “could cause investors to reassess the nature of any backstop and result in severe market disruptions.”

The letter points out “examples of potential harm” such as: “a sharp pullback in investor demand for GSE mortgage-backed securities (MBS) by investors concerned about a diminution of government support and an associated increase in credit risk exposure”; And, “an increase in mortgage credit costs during economic crises, negatively impacting the GSEs’ ability to support the market in the next crisis.”

The housing industry groups strongly oppose the swift ending of the conservatorship of Fannie Mae and Freddie Mac, but they don’t say they expect this will go on forever. They want to flesh out a plan that works for everyone.

“Our associations and the members we serve have worked over the past twelve years to develop reform plans and advance efforts – both legislative and administrative – that would correct structural flaws in the GSEs’ pre-conservatorship business models and allow them to transition safely out of conservatorship.”

“We have not supported, nor do we currently support, an “endless” conservatorship. Our position is quite the opposite – we wish to see the GSEs reformed and operating outside of government control. We therefore favor actions that move the GSEs closer to the preferred end state in a timely manner that does not disrupt the housing finance market and inflict broader economic harm.”

And, the NAR, along with the MBA, ABA, and NAHB now have a response to their letter.

According to The Wall Street Journal, Treasury Secretary Steven Mnuchin suggested, “he is unlikely to support a legal move—called a consent order—to end the government conservatorships of the mortgage-finance companies before President Trump leaves office.”

“We’re going to not do anything that jeopardizes taxpayers and puts them at additional risk. We also want to be careful that we don’t do anything that overnight would limit access to mortgage finance.”

For now, it looks like Sallie Mae and Freddie Mac will remain as government-sponsored enterprises.

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