New Mexico Assn. of REALTORS Voice 3rd qtr 2019

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NMAR Elects 2020 Officers James Russ II of Ruidoso was confirmed as 2020 President of the New Mexico Association of REALTORS® during the August 2019 Board of…
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NMAR Elects 2020 Officers James Russ II of Ruidoso was confirmed as 2020 President of the New Mexico Association of REALTORS® during the August 2019 Board of Directors meeting. Danny Wm. Vigil of Albuquerque was elected President Elect and Wes Graham of Clovis was elected Treasurer. Each of these officers will serve a one-year term beginning January 1, 2020. Julie Blair of Farmington was elected to a two-year term as Northwest District Vice President and Esther Purkey of Roswell was elected to a two-year term as Southeast District Vice President during the same meeting. At the Annual Membership Meeting, bylaw amendments creating a First Vice Presi- dent position (effective January 1, 2021) we approved. Ramos Honored as ROTY Leadership Award Teresa Ramos of Las Cruces received the Association’s highest honor - Recipients Named begin named 2019 REALTOR® of the Karen Hudson and Dan Hernandez, Year, during NMAR’s Fall Conference. both from Albuquerque, were named 2019 recipients of the Peggy Comeau Ramos’ list of activities at all levels of Leadership Award at the Celebration the REALTOR® organization is exten- Banquet August 22nd. sive and includes service as both the Las Cruces Association and NMAR Hudson and Hernandez were recog- President. She currently is serving as a nized for their outstanding service on Stanley H. Mathis Trustee. NMAR’s Building Advisory Group. This group has worked tirelessly to facilitate Teresa will NMAR’s transition to new headquar- be honored ters – and with other contin- state REAL- ues to TORS® of the oversee Year during vendor the National selection, Association of tenant REALTORS® finish Conference work, and and Expo in more. San Francisco. Volume 22, Edition 3, Third Quarter 2019 Published by the New Mexico Association of REALTORS® FROM YOUR PRESIDENT Paul Wilson 2019 New Mexico Assn. of REALTORS® President The Advantage of Being a REALTOR® What a terrific conference! It was great seeing so many • Truly, your RPAC INVESTMENT enables us as a BIG New Mexico REALTORS®. GROUP to be LOUD, gives us opportunity to be LOYAL (to our friends, the Real Estate Champions) and to be A special SHOUT OUT to our NMAR Staff for putting this LIQUID. With your INVESTMENT, we as a large voice entire event together. What a GREAT TOTAL EVENT!!! can be even bolder advocates for PRIVATE PROPERTY Thank you, Staff!!! RIGHTS and do whatever we can do to advocate for our clients, be they BUYERS, SELLERS, or INVESTORS. Those The way that our members used the occasion to do the issues include consumer property issues such as growth, “60s Dress Up” was quite impressive; some of the talent on housing policy, impact fees, land use, property taxes, display at the karaoke opportunity was downright enter- national flood insurance, and more. taining (and that was meant in the most respectful of ways, too!!!) I hope you enjoyed your time, met some new folks, • Here is an invitation for you as an individual to join the and learned something new you can use in your business. 36% of committed NMAR Members who have made a 2019 investment in RPAC. Truly, as has been said, “If real Congratulations again to REALTOR® of the Year Teresa Ra- estate is your profession, POLICY and POLITICS are your mos, and Leadership Award recipients Karen Hudson and business.” Dan Hernandez. It is always a pleasure to be able to honor REALTORS® who go above and beyond in their service Community and Veteran Outreach to the New Mexico Association of REALTORS® and to our There have been various events throughout the state that communities! have been conducted as community outreach. I would like to personally thank association leaders and District Vice As we roll in to the final quarter of 2019, I want to remind Presidents for their vision and focus on doing what needs you of some of your benefits of being a REALTOR®. to be done at the grassroots level. Way To GO!!! First, RPAC NAR Programs • So often people think of RPAC as a POLITICAL body. I There are two newer NAR programs you need to know thought this to be true early on in my REALTOR® career. about. However, what I have FOUND is that RPAC is really a POLICY vehicle where we are able to be in the arena C2EX of ideas. As someone once said, either we are AT THE • First is C2EX – Commitment to Excellence (www. TABLE or we are ON THE MENU. C2EX.Realtor). Research shows consumers & REAL- TORS® agree – honesty and professionalism are es- NMAR REALTOR® Voice | Third Quarter 2019 | Page 2 sential. C2EX was created to enhance the level of professionalism in the industry by Empowering YOU: to Evaluate… to Enhance… to Showcase… … YOUR high level of professionalism • The C2EX program covers 11 competen- cies to enhance your knowledge and skills. Approximately 20 New Mexico REALTORS® have completed or started this no-cost pro- gram – one you need to look into to set off on your journey of professional growth. Financial Wellness • The second NAR Program you need to be aware of is the Center for Finan- cial Wellness. This resource is designed exclusively to meet the specific financial planning needs of REALTORS®. The comprehensive program includes educa- tion materials and resources for wealth building, business planning, and invest- ing in real estate. • Nearly nine out of 10 REALTORS® are independent contractors and face com- plex situations when it comes to personal finances. Unique attributes such as fluc- tuating income, taxing issues, and lack of salary cap require a different perspective. • Log-in to www.FinancialWellness.Realtor to assess your current financial profile, receive personalized financial planning goals, practice financial planning decisions in a risk-free way, and explore a robust library of budgeting, retiring, and real estate investing resources. You can learn more about your financial options in monthly webinars from the Center. Topics, dates and registration information are listed on the NAR’s website. NMAR and NAR continue to watch out for you – make sure you take advantage of and participate in the programs that will enhance your career. NMAR REALTOR® Voice | Third Quarter 2019 | Page 3 FROM YOUR CEO New Mexico Housing Market M. Steven Anaya, NMAR Chief Executive Officer On Pace for Another Good Year 2018 was a record breaking year for home sales in New August 2019 reports show 16,915 sales have been report- Mexico with 32,006 sales reported to the New Mexico ed to date this year. This 2019 eight month total is more Association of REALTORS®. than the 12 month total for 2013! Eliminating numbers from 2018, which was an off the charts year, the increase All trends indicate 2019 numbers will not reach these in sales over the years does indicate the real estate market highs, however, based on the first eight months of this in our state is continuing to grow at what should be a year, 2019 should be the second best year since NMAR sustainable pace. started keeping statewide statistics in 2008. Year to Date Sales 35,000 32,006 30,000 25,000 22,221 19,933 20,000 18,733 August YTD 16,708 16,966 16,915 15,000 10,000 5,000 0 2013 2014 2015 2016 2017 2018 2019 January February March April May June July August September October November December NMAR REALTOR® Voice | Third Quarter 2019 | Page 4 Finishing Touches Median prices are at an all time high - $215,000 year to date in August 2019. The appreciation of New Mexico Furniture, lighting and new cab- properties has been steady over the past seven years and inets for the kitchen area of the mirrors nationwide increases reported by the National second floor conference room, Association of REALTORS®. small conference room set up for Zoom meetings, and parking lot striping - we’re almost done! Year End Median $200,000 $190,900 $185,000 $179,900 $175,000 $167,000 2013 2014 2015 2016 2017 2018 There is still an on-going inventory shortage, especially in the lower end of the housing market - smaller, moderately priced homes. First time home-buyers are often having a difficult time finding a home they can afford. The recent “good news” reports on New Mexico’s unem- ployment rate and job creation, together with continued low mortgage rates help to sustain our market. Not surpris- ingly, as incomes increase, the process of buying a home, even with rising home prices, is less of a strain. New consumer findings from the National Association of Realtors®’ 3rd quarter Housing Opportunities and Market Experience (HOME) survey show that 63% of people said they believe that now is a good time for a home purchase, with 34% of those respondents saying they believe that strongly. The NAR survey also asked respondents about their thoughts on selling a home in the current market. Seven- ty-four percent of those polled said that now is a good time to sell a home – a modest increase over 73% last quarter. Of those respondents, 45% said they “strongly” believe now is a good time for selling a home, while the remaining 29% said they hold that belief “moderately.” Respondents were also questioned about their outlook Owning a home is still strongly considered part of the toward the U.S. economy. Fifty-two percent of those sur- American Dream. REALTORS® play a vital role in helping veyed said they believe the U.S. economy is improving. This consumers reach the goal of home ownership and trends is a decrease from the second quarter of 2019, when 55% indicate buying and selling will remain a strong part of the said they believed the economy is improving. New Mexico economy for years to come. NMAR REALTOR® Voice | Third Quarter 2019 | Page 5 LEGAL UPDATE In The Business of Referring? Beware of Ashley Strauss-Martin NMAR General Counsel Negligent Referral Claims! REAL LIFE SCENARIO house that the home inspector just “missed”. The cost of re- pair: $30,000. Buyer brings suit against inspector who has Ex. #1: Buyer and Seller are under contract. During the no insurance and no money, so Buyer joins Broker Jane in inspection phase, Buyer’s home inspector identifies prob- the lawsuit. lems with the roof and asks Seller to repair. Listing Broker Dave recommends two roofers. Seller gets bids from both NEGLIGENT REFERRAL and chooses the lesser expensive of the two. In repairing the roof, the roofer uses a torch, and in so doing, sets the If you are referring home inspectors, handymen, contrac- house on fire. House burns to the ground. The value of tors, lenders, title companies, attorneys, surveyors, or any the destroyed improvements (the house): $280,000. The third-party service providers, you are at risk of being sued good news: homeowner’s insurance steps in and covers for negligent referral. Seller’s loss. The bad news: insurance companies have something called “subrogation rights”. This means that if To be liable for negligent referral, the judge or jury must some third party (such as the roofer) caused the damages, find that the broker acted negligently in referring that the insurance company has the right to pursue those dam- vendor. In other words, just because the vendor caused ages against the roofer. And this insurance company does. harm to the consumer does not in itself create liability for the broker; the consumer must prove more. Evidence that But in this case, the roofer is not licensed, has no insurance, the broker acted negligently may include the fact that the bond, or money. So, what happens next? The insurance vendor did not possess the license, certification, insurance, company looks to Broker Dave who referred this roofer to and/or bonding required by local, state, or federal law for the Seller and to Dave’s QB. The claim against Broker Dave the job to be done. Other evidence of negligence may be is “negligent referral” and the allegation is that Broker Dave that the vendor had multiple lawsuits and or complaints failed to do his due diligence to confirm that the roofer had filed against him/her for work performed for other con- the proper licensure and insurance for the job he was do- sumers or that the broker was aware of other dissatisfied ing as required by New Mexico law. The allegation against consumers, even if complaints/lawsuits were not formally Dave’s QB? Failure to Supervise? Failure to properly train filed. Dave in the art of referring? January 1, 2019, the NMREC’s new Vendor Certification But wait! It gets better! Broker Dave and his QB call their Rule (New VC Rule) took effect, which requires brokers Errors and Omissions (E and O) Insurance Company and “hiring” third-party vendors to only hire vendors who are that company denies the brokers’ claims citing to an licensed, certified, insured, and bonded as required by law. exclusion for “claims alleging, arising from, or related to While this New VC Rule is found in the Property Manage- the physical injury to, destruction ,or loss of use of tangible ment Section of the NMREC Rules, it is not limited to prop- property.” In short, NO E and O Coverage for either broker. erty managers (as the term” brokers”, not “property manag- ers”, was used in the New VC Rule). The term "hiring" is not Ex. #2: Buyer and Seller are under contract and Buyer defined in the rules, but the general definition (to which needs a home inspector. Smaller town in southern New courts will typically defer if there is no definition in the Mexico with a shortage of home inspectors. Listing Broker rule/statute) is to "engage the personal service of…for a set Jane gives the Buyer the name of ONE home inspector. sum.” Arguably, buyer and sellers’ brokers do not typically Buyer, relying on home inspection report, purchases "hire" vendors. They may make referrals/recommendations house. After closing, Buyer finds many problems with the and sometimes even set up appointments, but it is the buy- NMAR REALTOR® Voice | Third Quarter 2019 | Page 6 • Check with your insurance company to determine if you have coverage for negligent referrals generally, but more specifically, coverage for negligent referral in the er or seller who chooses the vendor and pays the vendor context of property damage. (in most cases), so (arguably) it is the buyer or seller who hires the vendor and the new rule does not apply in these- RELATED SIDE NOTES type situations. Home Inspector Trade Associations: Most home inspectors But the applicability of the New VC Rule to these type who belong to one of the two major Home inspector Trade scenarios is (arguably) irrelevant, because the cause of Associations, the American Society of Home Inspectors action of negligent referral stems from common law (case (ASHI) and the International Association of Home Inspec- law) which long pre-dates the New VC Rule. Historically, tors (InterNASHI) will have Errors and Omissions insurance. most jurisdictions have only recognized claims for negli- Though not required by either organization, it is promoted. gent referral in the area of medical malpractice; however, Both organizations require continuing education hours the claim is being extended to attorneys and real estate and testing. brokers. According to the InterNASHI website, InterNASHI has a MITIGATING YOUR RISK program, which will indemnify any licensed real estate agent in an amount up to $10,000 if a third party success- A number of years ago, NMAR added language to the fully sues the agent for negligent referral of an InterNACHI Listing Agreement, Form 1106 (Paragraph 15) and more inspector. According to InterNASHI’s website, this protec- recently to the Purchase Agreement, Form 2104 (Para- tion is offered at no cost to agents who register. graph 23) that addresses this issue: Home Inspector Licensing: On January 1, 2020, the Home SERVICE PROVIDER RECOMMENDATIONS. If Bro- Inspector Licensing Act (Act) will takes effect. The Act re- ker(s) recommends a builder, contractor, escrow com- quires all Home Inspectors to be licensed and insured. The pany, title company, pest control service, appraiser, Act also requires each home inspector pass a nationally lender, home inspection company or home warranty recognized test and take continuing education. The mem- company or any other person or entity to Seller or bers of the Home Inspector Licensing Board are currently Buyer for any purpose, such recommendation shall be being named and once the Board is created, regulations to independently investigated and evaluated by Seller or accompany the Act will be drafted. Buyer, who hereby acknowledges that any decision to enter into any contractual arrangement with any Radon: And did you know that Radon mitigation compa- such person or entity recommended by Broker shall nies must be a licensed as general contractors if they will be based solely upon such independent investigation be cutting, coring, boring, or drilling through concrete? A and evaluation. high majority of homes requiring Radon mitigation work require this type of work to successfully complete a Radon What can you do to mitigate your risk of a Negligent Refer- mitigation installation. ral lawsuit? Additional information regarding Radon testing and mit- 1. DON’T MAKE REFERRALS, especially when it comes to igation, as well as, local certified companies that provide inspections and/or repairs on the property! The Internet these services can be found here. is plentiful with websites where consumers can research contractors and vendors for any project. Suggest that the Legal Update provides a limited and general discussion of consumer conduct their own research! some, but not all, aspects of issues that is intended but not guaranteed to be accurate as of the date published. This 2. For those of you who plan on ignoring my first sugges- information may become outdated and it is the responsi- tion, when making referrals: bility of the user to determine if it is current. No summary • Always provide the name of multiple vendors; of the law is a substitute for legal advice with respect to a • Confirm (by soliciting and verifying the information) particular matter. No attorney-client relationship is intend- that the vendors being referred all have the proper ed or implied. If legal advice is required, the services of licensures and insurances for the job for which they are a competent attorney should be obtained. NMAR mem- bers are cautioned against engaging in the unauthorized being referred. See NMAR’s Vendor Certification, Form practice of law by advising a consumer of legal rights and 6107. obligations or by applying the law to particular facts and • For each vendor on your list, check with the vendor’s circumstances. © 2019 New Mexico Association of REAL- accrediting agency and the New Mexico Courts for com- TORS® plaints filed against the vendor; NMAR REALTOR® Voice | Third Quarter 2019 | Page 7 THE REALTOR® Growth and Involvement Program 2020 Session March 25-27 and ApriL 22-24 October 3 Forms Committee Head to the top! 7 8 2020 Committee Planning “60 Minutes with Membership” - training Become an effective for AEs volunteer in your REALTOR® association by 9 Budget & Finance Committee participating in NMAR’s 2020 10 Deming/Luna Co. Installation Growth and Involvement 11 Strategic Planning Committee Program 16-19 CMLS,2019, Salt Lake City 22 Benevolent Fund Planning 23 Executive Committee 24-25 NM MLS Annual Meeting, Ruidoso 28 Regulatory Task Force November 6-11 NAR Conference and Expo, San Francisco Emerging leaders of today 12 CARNM Installation will guide the REALTOR® Professional Education Committee 14 Forms Committee organization and real 20 Budget & Finance Committee estate industry into 21 Member Services Committee 22 Legislative Committee tomorrow! RPAC Trustees Details and application form are available here. 28-29 Thanksgiving Holidays, NMAR closed Application deadline is February 5, 2020 - reserve your spot now! December 3-5 REALTOR® Party Training, Austin Follow NMAR 4 5 GAAR Installation Santa Fe Installation 6 Ruidoso/Lincoln Co. Installation Be the first to know 11 Executive Committee about Association 12-13 NMAR 2020 Team Building even
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