The Institute of Real Estate Management (IREM) and the CCIM Institute have jointly honored Rep. Steve Stivers (R-Columbus) with their 2014 “Legislator of the Year” award, which honors members of Congress who have supported commercial real estate.
Serving his second term as the U.S. Representative from the 15th congressional district, Stivers was lauded for his support of all major commercial real estate advocacies, including Internet sales tax legislation, H.R.684, or the Marketplace Fairness Act. The companion legislation to H.R. 684, S. 743, passed the Senate with a vote of 69 (yes) to 27 (no). The bill would simplify and streamline the tax collection process for online retailers, correcting the inequity that permits them not to pay taxes, while brick and motor stores are required to charge and record a sales tax. Stivers also signed on to a letter urging EPA regulators not to hastily create regulations related to the Advance Notice of Proposed Rulemaking titled “Lead: Renovation, Repair, and Painting (LRRP) Program for Public and Commercial Buildings.”
By Anne Petit, Superintendent, Ohio Division of Real Estate & Professional Licensing
As a means to help our licensees comply with Ohio real estate license law and to keep them working, the Ohio Division of Real Estate & Professional Licensing has decided to kick-start its brokerage audit process after putting it on hold for the past few years. This decision is in agreement with the directives set forth in Gov. Kasich’s recent Common Sense Initiative.
We believe that working proactively with out licensees through positive instruction, when appropriate, instead of reactionary, punitive discipline will be beneficial to the Division, its licensees and Ohioans in general.
How will you know if the Division selects your brokerage for an audit?
You will receive a telephone call from a Division investigator if you have been selected for an audit. Brokerages selected for a compliance audit are chosen at random from those companies in the Division’s database that have not had an audit in the past 36 months. During this initial conversation, the investigator will work with you to schedule a data and time to conduct the audit. The investigator will then send written confirmation of the scheduled audit along with a list of the items the Division will inspect during the audit.
How long will the audit last?
Compliance audits can last anywhere from a few hours to several days, depending on the size of the brokerage. Most single office brokerage audits take just a few hours.
What can I expect after the audit?
The Division will notify the brokerage in writing of any discrepancies found during a compliance audit and will allow the brokerage a reasonable amount of time to correct them. Once the Division receives documentation from the brokerage verifying that the discrepancies have been corrected, the investigator will send correspondence to the brokerage indicating that it has come into compliance.
How can a brokerage prepare for a compliance audit?
There are several preparatory measures you, as a broker of the company, can take to ensure that the audit is successful. First, take a deep breath and relax! Although the audit may reveal discrepancies between your business processes and Ohio real estate license law, the Division’s main goal is to work with you to help you comply with the law. The most important key to a successful audit is cooperation with the investigator conducting it. Click here for an audit overview and checklist.
If you have any additional questions about the broker audit process or need additional information, please contact the Division’s enforcement section at (614) 466-4100.
By Marilou Butcher Roth
A while ago, a friend of mine attended a conference featuring Marianne Williamson as the keynote speaker. The theme of her talk was “being of service” which my friend and I discussed at length. This is such an interesting topic isn’t it? Especially in the real estate profession. I know that you realize this is a service industry, but what does that really mean to you? How do you see yourself as being of service?
I believe that we need to reconnect to our individual core values and project those values out into our business. This society has become one of fear. Consumers are constantly guarding themselves, afraid that someone is going to get the best of them somehow. Agents are afraid that their clients might not buy, or might not buy from them, and they are afraid to present the buyer contract to them to protect themselves because they are afraid they are being too pushy.
Where is the answer around all of this fear? We can only be responsible for ourselves. But, what if you became the change? What would happen if you shifted into wondering each morning how you might be of service? This is a powerful intention and will take you to experiences that you will find delightful. Being of service shows up differently for each of us, our clients and each situation.
I invite you to become an agent of change today! Reconnect to what is truly important, starting with your own values and extend that connection into how you are of service, and enjoy the results!
Marilou Butcher Roth is the owner of The MBR Group, a coaching and training company working primarily with REALTORS who have a desire to work and live from a more inspired place. She is also the Broker/Owner of Group REALTORS in Cincinnati. Marilou is a member of the OAR Executive Committee and immediate past chairman of the organization’s Communications Committee. Feel free to contact Marilou to see if coaching is right for you: Marilou@mbr-group.com
By Carl Horst, OAR Director of Publications/Media Relations
The Ohio Association of REALTORS is a leading source of information for the state’s real estate profession, according to findings of a recent member survey that gauged the effectiveness and content of the organization’s various communications offerings.
The survey marked the first comprehensive review of OAR’s printed magazine and online offerings since the Association revamped its delivery of news and information more than two years ago.
“We’re thrilled that not only do the real estate professionals indicate that they find value in our communication offerings, they also appear to enjoy the variety of distribution channels we are utilizing to tell the story of what’s happening in Ohio’s real estate industry,” said Bob Fletcher, OAR’s chief executive officer. “It’s gratifying to know that the effort to provide daily, Ohio-specific news has a receptive audience.”
In 2012 OAR launched a new approach to its communication products, notably changing the membership publication to a magazine format, creating the OAR Daily Buzz blog to serve as a daily gathering spot for news of interest to Ohio’s REALTORS and property owners and updating the Association’s website in order to make the information easily accessible and current.
Highlights of the Ohio REALTOR readership survey:
- About seven in 10 OAR members read all or most of the Ohio REALTOR magazine, with another 20 percent indicating that they read some of the publication.
- Nine in 10 OAR members believe the Ohio REALTOR magazine has a professional look making it easy to read. 88 percent say its well written and understandable. Slightly more than eight in 10 members agree the content is useful and informative.
- Membership is all business when it comes to reading the magazine, with 69 percent of respondents saying they read it to stay updated on the Association and 87 percent indicate they want to keep apprised of the latest trends.
- OAR members consistently look to the organization for legal information, so it’s no surprise that legal news, along with feature stories, top the listing of most read sections of the magazine. Other leading sections include professional development, Coaching Corner and the President’s message.
- 94 percent of members are either satisfied with the frequency of the Ohio REALTOR (60 percent) or would like to receive it more often (34 percent). The magazine is published twice annually, Winter/Spring and Summer/Fall.
- About two-thirds (63 percent) of OAR members are likely to patronize a company that advertises in the Ohio REALTOR magazine.
In terms of the OAR Daily Buzz blog and the OAR website, both have a majority of members visiting the sites to either read a specific story or obtain information. OAR’s eConnections, a weekly email digest of news headlines, is read by 95 percent of respondents.
“These findings provide us with an excellent overview of where we stand in terms of providing our membership with the news and information they need and want to be successful in today’s ever-changing real estate marketplace, as well as the areas of communication that can be improved,” Fletcher said.
Reprinted from the Winter/Spring 2014 Ohio REALTOR magazine
By Peg Ritenour, OAR Vice President of Legal Services/Administration
If you drive around many residential neighborhoods in Ohio you may notice a relatively new marketing technique used by some brokerages: “Coming Soon” signs. The use of such signs has been questioned by cooperating REALTORS and their buyers who want to see a property that appears to be for sale, but are told it’s not ready to be shown, only to find out that the property is in contract a few days later.
Another practice that has raised eyebrows is the increase in what has been referred to as “pocket listings.” This is a slang term used to refer to listings that are held by the listing brokerage, not submitted to the Multiple Listing Service (MLS) or made available to cooperating REALTORS to show. In some cases the listing is held back for a portion of the listing term and in other cases for the entire length of the listing.
Are such practices legal? Are they ethical? In most situations they are. However in other situations such practices may not only run afoul of the National Association of REALTORS’ Code of Ethics and the MLS rules, they may also violate the license law and the fiduciary duties owed to a seller.
Let’s look first at the “Coming Soon” sign. Certainly there is no law that prohibits this type of signage and in many cases they are appropriate. The reasons why such signs are used can vary, but generally such signs are utilized by listing REALTORS and sellers who want to generate some “buzz” or interest in the listing by starting the marketing process although the property is not yet in a condition where it is ready to be shown. Such situations commonly include REO properties when repairs are still being made, investment property that is being renovated or homes where the seller still needs to do a lot of purging and cleaning before it is ready to be shown.
As to the appropriateness of marketing such properties, there are several factors that need to be considered. First, does the brokerage/agent placing the “Coming Soon” sign on the property actually have it listed? If it’s not listed, is it legal to place such a sign on the property?
Despite what most REALTORS believe, Ohio license law does not require a licensee to have a signed listing before advertising a property or placing a sign on it. Instead, all that is needed is the owner’s consent. Of course to establish that such consent was given, it is recommended that this be obtained in writing from the seller, however that consent does not have to be in the form of a listing.
REALTORS who advertise a property without benefit of a listing agreement also need to make sure they do not misrepresent to others that they have the property listed. When other agents or their buyer clients see the “Coming Soon” sign they may question whether the property is in fact listed. Certainly if asked this by other REALTORS, the REALTOR marketing the property cannot misrepresent that the property is listed if it is not. Doing so could be found to be a knowing misrepresentation that could subject the agent to disciplinary action by the Ohio Real Estate Commission.
In most cases, however, a REALTOR using a “Coming Soon” sign does have the property listed. If the brokerage is a participant in an MLS, the MLS rules require listings to be submitted to the MLS within a certain number of days or hours (three days or 72 hours is common). If the owner does not want his property submitted to the MLS or will not permit showings, the listing REALTOR must be sure to follow the MLS requirements to document the seller’s instructions. As these requirements can vary, it is crucial for listing agents to check their MLS rules and to comply with them.
As stated above, one of the most common complaints about “Coming Soon” signs is that the listing agent will not allow other REALTORS to show the property because it is not in “showing” condition, but will show the listing to his own buyers and may even write an offer for them. Other REALTORS and their buyers who were refused access to the property are understandably upset when they later see it in the MLS in a “pending” status or see a sold sign on the property.
Listing agents who represent to other REALTORS or buyers that the property is not available to be shown but show it to their own buyers could face both ethical and legal challenges. First, it may be alleged that the agent violated Standard of Practice 3-8 of the NAR Code of Ethics, which provides that “REALTORS shall not misrepresent the availability of access to show…a listed property.” Such a complaint would be handled through the Professional Standards process at the Local Board/Association of REALTORS.
A similar allegation could also be filed with the Ohio Division of Real Estate and Professional Licensing. And if it is proven that the listing agent lied about the availability of the property to be shown, the agent could possibly be disciplined by the Ohio Real Estate Commission for making a knowing misrepresentation or for misconduct.
The second trend that has occurred in the last year has been an increase in “pocket” listings. Also referred to as an “office exclusives,” these are listings that are not submitted to the MLS and the listing brokerage generally does not offer cooperation or compensation to other brokerages. Instead, all showings and negotiations are handled exclusively through the listing REALTOR. Such listings have historically been entered into in situations where the seller wishes to limit access to his property based on privacy or security concerns, and for this reason, only wants the listing agent to handle the sale.
Such listings are not a new phenomenon, but have they have gone from a rarity in the marketplace to something occurring more frequently, making some question if they are truly the result of an increase in security and privacy concerns or are instead motivated by the listing REALTOR’s desire to retain the entire commission.
While this type of listing isn’t illegal per se, potential ethical, legal, and MLS issues may be involved. First, Article 3 of the NAR Code of Ethics provides that “REALTORS shall cooperate with other brokers except when cooperation is not in the client’s best interest.” Standard of Practice 3-10 clarifies that “The duty to cooperate established in Article 3 relates to the obligation to share information on listed property, and to make property available to other brokers for showing to prospective purchasers/tenants when it is in the best interests of sellers/landlords.”
The basis for these provisions in the Code of Ethics is a belief that cooperation among REALTORS increases the exposure of a listing in the marketplace and that such broad exposure will not only expand the pool of potential buyers, but will also result in better offers for the seller. Thus, offering such cooperation to other REALTORS is presumed to be in the seller’s best interests. For this reason, listing REALTORS who do not offer such cooperation must be able to establish that they are acting in this seller’s best interests to avoid a violation of the Code of Ethics.
Beyond these ethical considerations, a REALTOR’s fiduciary duties also require him to act in the seller’s best interests. Of course the determination as to what is in the seller’s best interests ultimately lies with the seller. However it is important that the seller has all of the necessary information in order to make an informed decision about how the sale of his property will be handled. Thus, before a seller agrees to a pocket listing, a listing REALTOR should explain the expanded market exposure that is gained by placing a property in the MLS and the benefits of offering cooperation. Such an explanation will allow the seller to make an informed decision as to whether it is in his best interests to keep his property out of the MLS and to limit showings to those handled exclusively by the listing brokerage. By obtaining such informed consent, the listing REALTOR can avoid a potential civil claim by the seller that the reduced exposure of his property resulted in a lower sales price.
Finally, as with “Coming Soon” signage, REALTORS taking such pocket listings must also be sure to follow local MLS rules regarding submission of listings and to provide any necessary documentation to the MLS to establish that the listing is not being submitted per the seller’s instructions.
In conclusion, while both “Coming Soon” signs and pocket listing are not illegal, there are ethical and legal issues involved, as well as MLS rules that must be followed by REALTORS. And most importantly, when representing a property owner in the sale of their home, the client’s best interests must be a REALTOR’s primary focus.