Florida To Decide (Again) On Property Tax Relief

Today (November 14, 2007) Florida Governor Charlie Crist signed the bill approved by the Florida Legislature on October 29,2007 regarding the proposed state constitutional amendment. If Florida's voters approve the amendment on January 29, 2008, the 4 part property tax cuts will become law.

The four parts of the proposed tax cuts are:

1. The current $25,000 homestead exemption would be doubled for primary homes valued at more than $50,000. Law-makers and analysts predict that the average homeowner will save $240 a year.

2. Save Our Homes (SOH) Portability. This will allow those with homestead exemptions to take their SOH with them when moving to another homestead. SOH limits annual assessment increases to 3 % on primary homes.

3. Businesses, second homes and rental properties will enjoy an annual assessment cap (10%) similar to that of the SOH.

4. Businesses can take advantage of a $25,000 exemption on equipment and other personal property.

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Florida Property Tax Update

The latest version of property tax reform: How it works

TALLAHASSEE, Fla. – Nov. 1, 2007 – The Florida Legislature, caught in a game of “chicken,” approved a measure that will appear before voters on the Jan. 29, 2008, ballot. With time working against them, lawmakers agreed on a measure that scaled back earlier initiatives, and even current reforms pushed by the House.

What the current amendment includes:

Homestead exemption
The homestead exemption increases. The current $25,000 homestead exemption remains; but a second $25,000 exemption is added for home values between $50,000 and $75,000. The second $25,000 exemption does not apply to school taxes, however, which translates into a lower-than-expected savings of about $240 per homesteaded owner. The portion of a home valued between $25,000 and $50,000 will still be taxed at all levels. FAR fought to include this taxable portion in order to maintain fairness for smaller cities and counties with lower median home values.

Portability – Moving up
Property tax savings portability (money saved over time on property taxes because of yearly increase limits through Florida’s Save Our Homes amendment) applies to homesteaders (homeowners with a homestead exemption) moving anywhere within Florida. Up to $500,000 of accumulated savings, applied to taxable value, may be transferred when one home is sold and another is purchased, with the transfer applying to all taxes, including the school portion. Homeowners have two years after they sell a home to buy a new one and transfer the savings.

If buying a more expensive home, a homesteader calculates savings by subtracting the assessed value (taxable value) from the just value (market value). The amount (savings over time) is then subtracted from the just value on the new home purchased. In most cases, the $50,000 homestead exemption will also be subtracted.

Example: Susie currently owns a home and has lived there for a long time. The house’s just value is $500,000, but because of Save Our Homes, the assessed value is only $200,000. Susie buys a new house for $700,000. The following year, she’ll pay taxes on only $400,000, however, because she’s “porting” $300,000 in value to her new home. After factoring in the new homestead exemption of $50,000, her total assessed value would be $350,000.

If buying a less-expensive home, the calculation changes and is based on the percentage of tax savings rather than a dollar amount. If the assessed value on the original home was 50 percent of the just value, for example, the homesteader would transfer that percentage to the new home, or have a new assessed value that is 50 percent of the new home’s just value. The percentage system was created to keep homesteaders from effectively eliminating their property taxes altogether by moving from a high-cost area of Florida to a low-cost area – a change that could severely hurt smaller rural economies.

Example: Susie currently owns a home and has lived there for a long time. The house’s just value is $500,000, but because of Save Our Homes, the assessed value is only $200,000. Susie buys a new town home for $300,000. She’ll pay taxes only on $120,000 because when buying down in value, she’ll keep the same ratio (40 percent) of assessed value to just value that she enjoyed in her old home. After factoring in the new homestead exemption of $50,000, her total assessed value would be $70,000.

Also, portability is retroactive to Jan. 1, 2007 – so everyone who bought this year and moved from an established homestead will be able to “port” their savings for next year. Since yearly tax values are based on ownership as of Jan. 1 each year, portability would not affect this year’s tax bills, which most homeowners have already received; but the savings will be applicable to next year’s tax bill.

Non-homesteaded property tax cap
A win for FAR and an important piece of the amendment is a 10 percent annual assessment cap on non-homestead property. Similar to Save Our Homes, this cap limits the assessed increases of commercial, rental and second home property taxes to a maximum amount of 10 percent per year starting in 2009, protecting against high spikes in taxes from year-to-year.

While property values will not rise 10 percent every year, FAR believes the cap offers some relief and protection to properties in high-value markets and waterfronts from unpredictable tax increases. The Constitution mandates a tax reassessment to just value upon transfer for non-homestead residential properties of nine units or less, but allows the Florida Legislature to determine how reassessment will occur for commercial and higher-unit residential properties. However, implementing legislation passed during the Special Session provides for reassessment of these properties upon a change in ownership or use.

Tangible personal property exemption
Under the amendment, the Tangible Personal Property (TPP) exemption for businesses is $25,000. The Legislature estimates that this tax – paid to local governments on items such as shelving, desks, computers, and other office equipment – will exempt about 1 million of Florida’s 1.2 million businesses that currently pay it. The amendment also drops the requirement to file for the TPP tax.

Work not done
While the proposed amendment will save property owners as much as $12 billion (depending on the portability amount used), FAR will work for greater relief measures. The association also has serious concerns about a challenge to the constitutionality of portability.

Earlier versions of property tax reform included provisions to help first-time homebuyers, a move missing in the current version. With that protection gone, FAR considers it possible that it will be challenged under the U.S. Constitution along with the entire Save Our Homes property tax system. If that happens, it could bring everyone back to the table yet again.

© 2007 FLORIDA ASSOCIATION OF REALTORS®

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Florida House passes property tax reform legislatio

TALLAHASSEE, Fla. – Oct. 23, 2007 – The Florida House passed a bipartisan property tax reform package yesterday by a 108-2 vote that addresses many issues important to Florida Realtors. House leaders consider the almost-unanimous vote an indication of that legislative body’s dedication to the plan. It now goes to the Senate for consideration.

Prior to the vote, Florida Association of Realtors®’ (FAR) President Nancy Riley sent a letter to House Leadership indicating the association’s support for property tax reform, specifically applauding the inclusion of an assessment cap for non-homestead and commercial property owners. The 5 percent yearly assessment cap on non-homesteaded property (assessment retriggers upon sale) and commercial property (assessment only retriggers with “substantial” improvements) would apply to local government and school taxes.

“The House proposal regarding an assessment cap for non-homestead residential property and commercial property addresses many of the tax problems with non-homestead properties’ high yearly assessments and an uncertain tax bill from year-to-year,” Riley told House leaders, since many “non-homestead property owners are rethinking whether they want to invest in Florida.”

Another provision FAR leadership finds appealing is a guaranteed property tax break of 40 percent for homesteaded property or Save Our Homes savings. Homeowners would take advantage of the tax relief plan that saves them the most money. The 40 percent break would offer substantial and immediate relief to new homebuyers or those who purchased a home within the past few years.

“We are also pleased that both the Senate and House are advocating for “Save Our Homes” portability,” Riley says. “While not precisely in line with FAR’s stated position (local county option or a phase-out of ‘Save Our Homes’), this is mitigated by the House’s proposed assessment cap on non-homestead properties.” The House proposal includes statewide portability of property tax savings under Save Our Homes.

Other legislative highlights include:

• No doubling of the homestead exemption
• The Legislature will be allowed to change assessment methods for working waterfronts and affordable rental housing
• The Miami-Dade Property Appraiser must be elected, rather than appointed
• $25,000 tangible personal property tax exemption

The House bill, while covering many FAR goals, is still not the final word, however. “FAR will continue to promote property tax reforms in the areas of ‘highest and best use,’ presumption of correctness, value adjustment boards and assessment issues related to affordable housing and working waterfronts,” says Riley.

The Senate is slated to reconvene on Thursday. A Call-to-Action will probably be issued by FAR shortly, asking Realtors to contact senators, encouraging them to approve the House plan. The House and Senate must approve a bill by Oct. 29 to make it onto the Jan. 29 ballot.

© 2007 FLORIDA ASSOCIATION OF REALTORS®

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Florida House pushes for stronger property tax cuts

TALLAHASSEE, Fla. – Oct. 22, 2007 – On Saturday, Florida’s House of Representatives released its updated property tax reform plan, which includes a number of initiatives favored by Florida Realtors.

House leaders now hope to build a bipartisan consensus to show the Senate that they’re serious about drastically cutting state property taxes. If Democrats and Republicans pass the measure with something close to a majority, they reason, the Senate would have to consider the plan.

“If we come out with a product in the House that’s 118-2 or 115-5, it sends a message that, look, this is pretty good reform that we’re united behind,” says Rep. Jack Seiler, D-Wilton Manors. “We actually deliver the same in tax cuts [as the Senate’s plan], but we deliver it more efficiently.”

In addition to portability – which the governor, Senate and House already advocate – the updated House proposal includes a 5 percent assessment cap on commercial and non-homestead property. The cap applies to properties, so a change of ownership would not change those taxes under a new owner, giving non-homestead property owners a degree of stability and predictability.

The House also advocates a new homestead exemption. Instead of doubling the current $25,000 exemption, the plan would guarantee a minimum Save Our Homes exemption of 40 percent of a county’s median home price. House leaders believe this will provide relief to not only new buyers but also those who have purchased in recent years.

Issues being proposed in the House plan include:

•Homestead property owners would pay tax based on their existing Save Our Homes value or current value minus 40 percent of their county’s current median home price, whichever is less.
•5 percent cap on commercial and non-homestead property taxes
•Under portability, homeowners may transfer Save Our Homes benefits to a new homestead anywhere in Florida within two years of leaving their former homestead.
•Tangible personal property exemption of $25,000
•Limits the authority of local governments to increase property taxes
•Provides limitations on the assessed value of properties used for affordable housing
•5 percent assessment growth limitation for all non-homestead properties
•More flexibility for the Legislature to limit assessments for working waterfront properties
•Election of all county property appraisers

FAR has a downloadable chart comparing the recent House proposal to Senate positions here.

© 2007 FLORIDA ASSOCIATION OF REALTORS®

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A Taxing Dilemma

As most of you are aware by now, the proposed "Superexemption" property tax amendment was removed from the January 29, 2008 ballot by Leon County circuit court judge Charles Francis. While this move is clearly disappointing to many expecting huge property tax relief, we must overlook this gaff find the good in an otherwise poor decision. Florida Governor Charlie Crist and others are feverishly working to put together another tax relief bill and get it in front of Florida voters for the January primaries. In order to do that, lawmakers need to finalize a new plan, likely with less "oomph", and submit it by the end of October, 2007...the constitutional deadline for putting a new amendment on the January 29, 2008 presidential primary ballot. Maybe this one won't confuse judge Francis.

As a strong part of his election campaign, Crist spoke of Save Our Homes portability and doubling the homestead exemption...and he may have to stick with that premise for now. While Crist and others who are forging tax relief proposals are avoiding making criticisms about Francis' ruling, they are optimistic about the opportunity to provide what they hope will be a better plan. Even if there is some kind of relief put on the ballot, it doesn't necessarily mean that this will be the end of Crist's efforts. Crist has said that he will continue to fight for property tax reform for Florida until a dramatic solution is in place.

Meanwhile, the first phase of the original plan has already taken place...freezing tax rates and telling Florida's Counties and Cities to trim the fat. But, believe it or not, there are those out there who want to ruin the party we've all been invited to. Enter Weston Mayor Eric Hersh, County Commissioner Ilene Lieberman, Fort Lauderdale City Commissioner Carlton Moore, Hallandale Beach Mayor Joy Cooper and a slew of others. They don't seem to want to be told how much tax revenue they can squeeze out of Florida residents...or how to spend it. While at this point some of them are only vowing to get involved in suing the State over this benefit to taxpayers, Hersh has already cried foul and put his foot in the mud. Hersh sued claiming the reliefs were illegal and that the Florida constitution gives the local governments the authority to impose taxes up to $10 per $1,000 of assessed value. Apparently Hersh wants access to the whole enchilada. Even after Francis made one good decision by telling him no, and that the Legislature has the power to limit that authority, Hersh says he and his attorney have grounds to contend Francis' ruling as incorrect.

Makes you wonder if Hersh or the others would support ANY property tax relief, after all, the money that would go back into the pockets of Florida's citizens would have to come from somewhere. Seems like he would rather be able to spend your money than to have the opportunity to do something about out of control taxes.

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Change Is Good

If there is one thing that is constant, it is change. And if there is one thing I have learned in life, it is to seek change before change seeks you. In light of that, it is with mixed emotions that I announce that I am no longer with Exit Realty Consultants in Brandon, Fl. I have made the move to Exit Extreme Realty in Tampa, Fl. While for my friends and customers the change will be transparent, this decision puts me more in line with my long and mid-range goals. My phone number, e-mail address, website and blog remain unchanged, as does my commitment to all of you. Fell free to call or write with any questions.

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Think About It-Don't Be A Billy

Picture it. It's Christmas Eve...little 7 year old Billy has been begging Santa for the last 3 months for a brand new bicycle (the GIZMO RACER 5000) to replace his old, run-down bike (a GIZMO RACER 1500). Billy has been complaining for a long time about how useless his current bike is. So he sneaks downstairs and under the tree he spots a present with his name on it, you know the kind, no box, just wrapping paper. But its the shape of a bicycle. Billy peels apart just a small corner and takes a peek. It IS a new bike, but it's not a GIZMO RACER 5000, it's a GIZMO RACER 3000.

Disappointed, Billy returns to his room for the night. The next morning Billy's parents can't wait to see his excitement as he opens his present. But Billy refuses to accept it and complains about how its not the best bike available. No, he's going to hold on to his old worn out bike until "Santa" goes back to the drawing board and brings him the best bike possible. Besides, Billy's friends have been telling him that the GIZMO RACER 3000 might not be as good as his beat up GIZMO RACER 1500 with no brakes and a chain that keeps falling off. It's a brand new bike. It's a better model than his old one. Is there a better bike on the market? Sure. But the GIZMO RACER 3000 is better than what Billy has now. The moral of the story? Billy should be thankful that he was given a new bike, and he should stop listening to his friends that don't want him to have a new bike. Billy's not a brat, he just needs to THINK ABOUT IT.

Ok, so why this little story? Because it's Christmas Eve folks. You need to start thinking about what you need and want here in Florida....Property Tax Relief. There is, and has been, a lot of talk about the proposed SUPER EXEMPTION. Research (below) shows that over 90% of Florida Home Owners will be better off with the new plan. Yet support seems to be about 50/50 for the upcoming decision. Do the research for yourself on your County Property Appraiser's website and ask yourself this question. Do I accept a better bike than I have now, or do I refuse it and complain (and continue to suffer) that its not the best bike that can be made? Don't be a Billy. THINK ABOUT IT.

Below is an article from the Florida Association of Realtors® which was the inspiration for the story above.

A TAXING EFFECT

The analysis is in, and it’s ponderous. A comprehensive study of Florida property tax laws – ordered by the Florida Legislature and conducted by a team of economists from the University of Florida and Florida State University – was released yesterday. Issued in three parts, the entire study has 689 pages and sometimes-challenging text. But it does study the state’s property tax problems from all angles. For example, the study finds that only 9.2 percent of Florida households would be better off keeping their Save Our Homes exemption if the proposed property tax amendment passes in January – but the authors also note that far more would opt to keep SOH under that scenario. To download the complete report or any one of the three parts, go to: http://edr.state.fl.us/property%20tax%20study/property%20tax%20study.htm

© 2007 FLORIDA ASSOCIATION OF REALTORS ®

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Fed Up With The Property Tax Issue?

Well, do something about it. Attend a Taxing Authority budget hearing, speak your mind, ask questions, listen...learn, and be informed. I received an e-mail today from the local Association of Realtors® with the schedule of these hearings. Here's what it had to say (©2007 Greater Tampa Association of REALTORS®). These hearings are to finalize millage (tax) rates for property taxes. Here is the schedule for some of the budget hearings of the Hillsborough County taxing authorities. Property owners are invited to attend and inquire about millage rates for various jurisdictions and ask questions about the budgets. Please call to confirm the dates and times prior to attending!!!

TAXING AUTHORITY/PHONE 1st HEARING TIME HEARING LOCATION

Hillsborough County 813-272-5890 Sep 5th @ 6:00 p.m.
601 E. Kennedy Blvd Tampa

City of Tampa 813-274-8111 Sep 4th @ 5:01 p.m.
315 E. Kennedy Blvd Tampa

City of Temple Terrace 813-989-7103 Sep 4th @ 7:00 p.m.
11250 N 56th St Temple Terrace

City of Plant City 813-659-4200 Sep 10th @ 7:30 p.m.
302 W Reynolds St Plant City

School Board 813-272-4064 Sep 6th @ 5:01 p.m.
901 E. Kennedy Blvd Tampa

Transit Authority 813-623-5835 Sep 10th @ 5:30 p.m.
601 E. Kennedy Blvd Tampa

Children’s Board 813-229-2884 Sep 13th @ 5:01 p.m.
1002 E. Palm Ave Tampa

Water Management 352-796-7211 Sep 11th @ 5:01 p.m.
7601 Highway 301 N Tampa

Tampa Port Authority 813-905-5132 Sep 12th @ 5:01 p.m.
1101 Channelside Dr Tampa.

Click here to read the full article

Choosing Your Tax Plan Just Got Easier

With all the talk about the proposed "Super Exemption" being placed in front of Florida voters in January, there are a lot of misconceptions, and a down-right lack of understanding. I have been writing about the proposed plan for a while now, but for some of you, it just got a lot easier with property appraiser websites.

There is a new feature on the Hillsborough and Pinellas County Property Appraisers websites that allow you to calculate your taxable property value under the Super Exemption plan. While both sites are similar, there are a few minor differences. Essentially they allow you to compare the current Save Our Homes tax limitation against the proposed Super Exemption plan side by side to help give you an idea as to which plan may benefit you.

Before you go to either site, keep in mind a little professional opinion. In an "average", "stable" market, a 4% increase per year in market value is common. This will all make sense once you go to the Appraiser's site.

For Hillsborough County:
Go to the Hillsborough County Property Appraiser's Property Record Search page, linked here. Enter your name (last name, space, first name) and hit the search button. Once you find your property, click on it. Once on the page with your property info, just below the "Value Summary" you will see "Super Exemption Calculator". Click on it and a new page will pop up. The assessed value, market value and exemptions (if any) related to your property will automatically be filled in.

Now, from the drop down menu you will be asked to select a "Real Estate Appreciation" percentage. This is what I was referring to earlier. Personally, I think 4% is realistic. That's my opinion. Talk to a professional in your area for their opinion. Next, select the number of years into the future you would like to compare the plans, and hit "Calculate".

What you will see is the current Save Our Homes taxable value of your home on the left, year by year and the Super Exemption taxable value of your home on the right.

For Pinellas County:
Go to the Pinellas County Property Appraiser's main page, linked here. Less than half way down the page you will see "Super Exemption Calculator now available! Click here for complete information". After clicking that link, follow the easy instructions for finding your property. From there, this site is very similar to the directions I just gave you for Hillsborough County.

Was this information useful? Has it helped you come closer to deciding which plan is best for you? I want to here about it. Click on "Post A Comment" (below) and give me your 2 cents.

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July Market Report

Here is the real estate market report for July, 2007.

***Disclaimer***
The information I am posting is from a variety of resources and ultimately not all homes can possibly be accounted for due to public records errors, and the fact that there is no accurate comprehensive database for FSBO's (For Sale By Owner). Prices are rounded off for convenience and this data is for informational purposes only.

**Subscribe to my Blog to get notices of updated information and new articles! Just enter your e-mail address in the box below the For Sale By Andy logo!

JULY

Brandon
# Sold 65
Avg SP $253,000
Med SP $210,000
Avg DOM 92
Med DOM 75

Valrico
# Sold 66
Avg SP $272,000
Med SP $261,000
Avg DOM 91
Med DOM 78

Seffner
# Sold 13
Avg SP $193,000
Med SP $192,000
Avg DOM 49
Med DOM 35

Riverview
# Sold 99
Avg SP $223,000
Med SP $208,000
Avg DOM 86
Med DOM 67

Tampa
# Sold 658
Avg SP $313,000
Med SP $225,000
Avg DOM 105
Med DOM 80

Lithia
# Sold 27
Avg SP $344,000
Med SP $320,000
Avg DOM 97
Med DOM 81

Legend:
# Sold: Number of homes that sold during that month.
Avg SP: Average sold price of the homes sold.
Med SP: Median sold price of the homes sold.
Avg DOM: Average # of days those homes were active on the market.
Med DOM: Median # of days those homes were active on the market.

Click here to read the full article

June Market Report

Here is the real estate market report for June, 2007.

***Disclaimer***
The information I am posting is from a variety of resources and ultimately not all homes can possibly be accounted for due to public records errors, and the fact that there is no accurate comprehensive database for FSBO's (For Sale By Owner). Prices are rounded off for convenience and this data is for informational purposes only.

**Subscribe to my Blog to get notices of updated information and new articles! Just enter your e-mail address in the box below the For Sale By Andy logo!

JUNE

Brandon
# Sold 70
Avg SP $219,000
Med SP $193,000
Avg DOM 90
Med DOM 79

Valrico
# Sold 69
Avg SP $286,000
Med SP $275,000
Avg DOM 95
Med DOM 81

Seffner
# Sold 25
Avg SP $195,000
Med SP $178,000
Avg DOM 99
Med DOM 67

Riverview
# Sold 118
Avg SP $237,000
Med SP $223,000
Avg DOM 98
Med DOM 78

Tampa
# Sold 817
Avg SP $306,000
Med SP $238,000
Avg DOM 108
Med DOM 88

Lithia
# Sold 45
Avg SP $383,000
Med SP $337,000
Avg DOM 96
Med DOM 66

Legend:
# Sold: Number of homes that sold during that month.
Avg SP: Average sold price of the homes sold.
Med SP: Median sold price of the homes sold.
Avg DOM: Average # of days those homes were active on the market.
Med DOM: Median # of days those homes were active on the market.

Click here to read the full article

Declining Sales Prices

Real estate is an investment. Whether you buy a home for that reason or not, it is an investment. It is the largest purchase you are ever likely to make. Therefor, it should be looked at just as seriously as professional investors do. True investments are not short term in nature.

In real estate, owning a home for just one or two years IS short term. If you bought a home within the last two years and now want, or need to sell, then yes...it is going to be hard to avoid losing money. This would be the equivalent of buying stocks when they are on the way up and selling when they are on the way down. That's not what the pro's do.

Successful investors don't pay a lot of attention to short term numbers, they look at long term trends. So comparing home prices from five years ago, there has been a tremendous, steady gain. Many areas have seen a 50% - 80% increase over the past five years. So a small "loss" of 2% - 7% in prices in the last year or so is still a long term gain.

The doom and gloom (or Chicken Little Syndrome) many of us hear in the media circles is great for selling papers, or getting people to watch a particular channel, but should not be your primary source of information. Numbers being thrown around are general, not specific to a small enough area for anyone to take to heart. A general number isn't really a good rule of thumb for a state, a county, or even for one town.

For example, Eastern Hillsborough County is different from Western Hillsborough County. Brandon is different from Valrico. Copper Ridge (Valrico) is different from Brandon Brook (also Valrico), which is different from Buckhorn Estates (also Valrico). Do you see the point I'm making? If you truly have concerns about the market value of YOUR home, consult a professional who can look at YOUR area, it's trends and amenities, and apply that to YOUR specific home.

So, is the sky falling? No. Is it raining in a lot of areas? Yes. But don't go building an Ark just yet, the skies are showing signs of clearing up, and for the Tampa Metro area, the forecast is looking pretty promising.

For those interested...you can get a neighborhood trend report e-mailed to you without cost or commitment. Just send me an e-mail with your name and address. If you choose, you can also get updates when homes in a particular neighborhood go on the market and/or sell.

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Best U.S. City To Buy A Home

Forbes Magazine has recently released it's Top 10 List of the best places in America to buy a house. Who made the list? Where's the Best Place? Why is it number 1? Read on to find out.

Forbes Magazine (the on-line edition) teamed up with Moody's Economy.com to announce where they feel are the best places to buy a home...and why. First, what qualifies an area to be considered?

According to Forbes, some of the indicators are when an area has an overall strong, growing economy and comparably modest housing prices. The area must also be overstocked in real estate inventory with plenty of sellers anxious to negotiate. In addition, an area is prime for a market "bounce back" if it is seen as one where prices aren't likely to fall so drastically that buyers are getting in while the market is still sharply on the way down. These areas are typically referred to as "V" Shaped Recovery areas for their sharp decline, followed by a sharp rebound.

While ANY recovery would be a welcome site to all the people trying to sell their home right now, those who live in the areas that made the list may want to think of the "V" as in Victory. Ok, enough already! WHERE'S THE LIST?!?!?!

Here you go (in reverse order for dramatic effect!):

#10. Atlanta
# 9. New York City
# 8. Milwaukee
# 7. San Diego
# 6. Phoenix
# 5. Chicago
# 4. Kansas City
# 3. Miami
# 2. Minneapolis

And the Number One Place In The U.S. To Buy A Home Is.......

# 1. Tampa Bay!!!!!!!!!!

That's right! Tampa Bay. Forbes is saying that the Tampa/St Petersburg/Clearwater area is prime for a strong market recovery and calls it a "...highly resilient market." Projected job growth and a good economy set the tone for correcting the recent market down-turn, paired with investor-heavy inventory beginning to taper off. While Forbes is predicting a first quarter 2008 bottoming for the area, Tampa Metro is their pick for #1!

If you would like to search for homes currently available in the Greater Tampa area, click here.

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Save Our Homes Exemption Answers

I received a question from someone asking how they could determine if they have the Save Our Homes limitation on their homestead property. Since the answer varies from homeowner to homeowner, plus it was a very good question, I thought I would clear it up a little.

If you own a homestead property in Florida, and have had it since 2004 or earlier, then the answer is yes. If you bought and homesteaded a home in 2005, then last year (2006) you did not qualify for the Save Our Homes limitation, this tax year (2007, to be paid in early 2008) you do.

The Save Our Homes Amendment of the State's Constitution was approved by Florida voters in 1992 and put into effect in 1995. This amendment places a limitation of 3% on any annual assessment increases on Homestead Properties in Florida. However, the limitation does not apply the year following a change of ownership.

Residences without homestead, non-residential property, vacant land, tangible personal property, commercial property, and agricultural property, are not eligible for the amendment limitation.

Once the property has been conveyed to the new owner, it is raised to full market value January 1 of the following year. The new owner must apply for and receive homestead exemption. The year following the granting of homestead exemption the property is subject to the limitation.

However, if the new "Super Exemption" property tax plan passes in the January 29, 2008 statewide vote, everything changes. In many cases, you will pay less in property taxes...how much depends on whether or not the County Board of Commissioners changes the millage rate as well as if the County Property Appraiser re-assesses property values.

Example 1:
If the bill passes and millage rates and values are unchanged, your tax bill should go down, significantly.

Example 2:
If the bill passes, millage rates don't change, but assessed values are adjusted to realistic market values, your tax bill is still likely to go down from what you are paying now.

Everyone's specific situation is different and this is meant only to give you a general idea.

I have already contacted Congressman Adam Putnam's office (the Representative for my area) asking what the plans are if the bill passes. When I get an answer, I'll post it here. Subscribe to this blog in order to receive automatic updates from me on this and other topics involving home ownership.

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5 Arrested In Mortgage Loan Scam

Five people were arrested last week for their role in fleecing homeowners out of millions of dollars in bogus mortgages. So far it seems this group of low-lives preyed upon minorities, the elderly and the poor. Scott Almeida, Orson Benn, Adrienne White, Frank Giffone and Samuel Green were all picked up on numerous charges. Two of the five (Almeida and Giffone) were from the Tampa area.

Scott A. Almeida was arrested on 7/18/07 and so far faces 15 charges including 1 count of "RICO VIOLATION", 1 count of "RICO CONSPIRACY OR ENDEAVOR", 6 counts of "OBTAINING A MORTGAGE NOTE BY FALSE REPRESENTATION", and 7 counts of "GRAND THEFT SECOND DEGREE".

Frank S. Giffone, also arrested on 7/18/07, faces 18 charges including 2 counts of "RICO VIOLATION", 4 counts of "GRAND THEFT THIRD DEGREE", and 12 counts of "ACTING IN THE CAPACITY OF CONTRACTOR WITHOUT A LICENSE".

RICO stands for "Racketeer Influenced and Corrupt Organizations", which is a U.S. federal law enacted in 1970 that compounds the penalties of criminal acts performed as part of an ongoing criminal organization.

Almeida, Giffone and White, are all former owners, principals or employees of the Hillsborough County mortgage broker companies Advanced Mortgage Solutions and Consumer Lending Resources. In addition to the mortgage brokerage businesses, the defendants operated two home improvement companies: Premier Quality Renovations and Florida Beautiful Construction. Almeida and Giffone convinced mostly minority homeowners in poor areas of Florida to take out home loans to finance significant home improvements. The pair then submitted loan applications that included false, forged or counterfeit documents. The scam continued with Benn and Green abusing their positions at Argent Mortgage (White Plains, N.Y.) by approving the fraudulent documents and loan packages, then distributing the funds amongst the group. The victims in these situations were now on the hook for these loans and of course, little or no improvements were actually made by the group.

According to the Florida Department of Law Enforcement, in total, Almeida and his associates, through various mortgage broker businesses, have submitted approximately 180 loans through Argent Mortgage Company totaling nearly $18 million. At least 129 of these loans were funded in the amount of approximately $13 million.

State Attorney General Bill McCollum said, "The allegations brought against these individuals are unspeakable. To prey on the hopes and dreams of these people who were simply trying to improve their homes is a terrible scheme and my office is committed to prosecuting those involved to the fullest extent of the law. I commend the cooperation exhibited by this investigation and look forward to a positive resolution for the citizens who were victimized."

The investigation began 3 years ago and the results are a compliment to the multi-agency cooperation between the Tampa Police Department (TPD), Hillsborough County Consumer Protection Agency (HCCPA), Pinellas County Department of Justice and Consumer Services (PCDJCS), Florida Attorney General's Office of Statewide Prosecution (OSWP), and the Florida Department of Law Enforcement (FDLE).

This is just one example of the numerous scams that are out there. If you feel you have been the victim of a scam, contact your local police department, or in Hillsborough County Florida, call Kevin Jackson, Chief Investigator at the Hillsborough Consumer Protection Agency 813-903-3425. Brush up your awareness on some other scams by reading other articles I have posted:


Property Deed Scam
Cash Back At Closing Scams
Urgent Message

Click here to read the full article

Thinking About A Home Warranty?

What is a home warranty?
A home warranty is a one year residential service contract that provides repair or replacement coverage for the major operating systems and appliances that fail in a home due to normal wear and tear.

Guest Author:
Loretta Johnson
First American Home Warranty

Home Buyers’ Benefits :
Move in with assurance knowing your home is covered. You are covered for unexpected home repair or replacement costs on many of your home’s major systems and appliances. Coverage is regardless of the age, make, size or model of the systems or appliances. No “Obsolete Parts Clause”. If it can’t be fixed, we will replace it (*Subject to terms of contract). It only takes a phone call and a small service fee to fix the problem. Service is available 24 hours a day, 365 days a year. You’ll have budget protection knowing you only have to pay a nominal service fee per trade call.

Home Sellers’ Benefits:
Sell with confidence. Having a home warranty as an additional feature will give you a competitive edge over other homes on the market. Buyers have more confidence in your home and there is usually less negotiating in getting closer to your asking price. If something breaks after the sale, there is limited liability for you. Buyers will contact the warranty company rather than calling you. Protect your budget, one major breakdown before or during the sale of your home can very costly and delay things.

A home warranty is just the “life saver” you need to add value and security to resale homes. In today‘s market, sellers and Realtors® alike are looking for ways to bring attention to their properties and something to make them shine over their competition. More and more, buyers are asking for the after sale protection from unexpected breakdowns of the homes major systems and appliances.

Home warranties typically cover major components, such as HVAC systems, plumbing, electrical and hot water heaters to name a few. It is always important to review the brochure for specific coverage details or to call your local representative. Considering the thousands of dollars in items covered by a home warranty, it is a very affordable “safety net” for budget protection, and in fact, a real bargain. Do not buy or sell your home without one, everyone benefits! A First American Home Protection Plan can make buying or selling a home a rewarding experience for everyone involved.

Did you know?
-A customer uses their warranty 2 times on average? If they didn’t have the warranty, then the expense for the repair would be out of pocket.
-In 2006, we saved contract holders over $119 million on their covered systems and appliances.
-Last year, we responded to more than 900,000 service requests.
-Rated “A” Excellent by A. M. Best.
-We have the financial strength to protect their customers.
-We have been providing quality service since 1984.
-13 SEER air conditioning coverage.
-No extra charge for multiple systems.

This "Guest Author" installment was contributed by:
Loretta Johnson
First American Home Warranty
www.homewarranty.firstam.com

Click here to read the full article

Brandon/Valrico Area Gets Railroaded By Transit Plan

The headline of today's METRO section of the Tampa Tribune reads: "Getting Bay Area's Transit Act Together". Perhaps it should have been: "Regional Transit Workgroup Missed Their Train". The Bay Area has long needed a viable mass transit system not only to ease current congestion, but to be in position to handle future growth. Numerous plans in the past for a true transit system lacked support and never really developed further than "planners" taking a red felt-tip pen to a $3.99 folding map.

This time things seem to be a little different with Governor Crist signing into law the "Bay Area Regional Transportation Authority" (BARTA), as well as Florida's Department of Transportation seeking local plans for routes. A group from 6 counties, formed by Pinellas County Commission Chair Ronnie Duncan, provided the Tampa Tribune with a map, outlining proposed regional rail, bus and ferry routes. If you don't have a subscription to the Tampa Tribune, pick up today's edition on your way home or go to their website and take a look at it.

Alright, so why the title, "Brandon/Valrico Area Gets Railroaded By Transit Plan" you ask? Only 2 options on this map even come close to the Brandon/Valrico/Riverview area. One is an "enhanced" bus line running up Interstate 75, but diverting West towards Tampa before Adamo Drive/Brandon Boulevard. The other is a rail transit line connecting Tampa to Plant City and Lakeland. However, this path really only touches North Brandon/South Seffner on it's way.

The Tribune quotes Duncan as saying, "This is about offering options, we're sitting in traffic more and more, and every year that goes by it gets worse.". Well excuse me, but has he or anyone on his panel ever even heard of Brandon? As a Realtor®, I can't tell you how many times I have been showing a home to a prospective buyer and heard them say, "Oh, gee I don't know. It seems awfully close to the train tracks.", only to hear them say that at the next 4 homes in different communities. I'm sure many others in my profession locally can relate. My point? Brandon, Valrico and Riverview (BranRicoView - catchy, don't you think?) are riddled with existing tracks in use by CSX. How did the planning group overlook that area?

For those of you who aren't aware of just how busy this area has become, let me throw some numbers at you. Below are the DAILY automobile traffic counts for the 3 main roadways leading into/out of the BranRicoView area. (Source: Hillsborough County Transportation website)

Brandon Blvd:
Falkenburg Rd to Lakewood Dr..........99,000
Lakewood Dr to Lithia Pinecrest Rd.....76,200

Bloomingdale Ave:
US HWY 301 to Kings Ave......43,600
Kings Ave to Bell Shoals Rd.....49,800

Lumsden Rd/Causeway Blvd:
Providence Rd to Kings Ave.............47,500
Falkenburg Rd to Providence Rd........68,600

Again, those are DAILY counts...and just for those 3 roads. Keep in mind, these roads bring commuters to the Crosstown Expressway (cough, too little too late, cough) and Interstate 75 (cough, parking lot, cough), where you can now BEGIN your commute. Anyone who has driven in BranRicoView more than once can attest to the number of trail tracks. So the options are there, why not ease congestion and turn the railways into a double positive? Instead of new residents not wanting to be close to noisy tracks, perhaps they would WANT to be close to commuter rail stations.

Let's see...plenty of existing CSX tracks to choose from, the opportunity to reduce traffic in a high volume (growing) area, and offer positive options to tens of thousands of commuters and voters. It makes perfect sense to completely avoid BranRicoView, Tampa's most populated neighbor to the East.

Don't misunderstand me, I am completely in support of an efficient, effective transit system in the Bay Area. I believe it's necessary for the area to become a major player in attracting large companies (and the jobs they would create) and hosting significant national and international events. But a transit plan that doesn't adequately address this densely populated area is flawed, in my opinion.

If you feel strongly enough about future tax dollars being spent on a transit system that ignores the (arguably) most congested part of Eastern Hillsborough County, please contact the Regional Transit Workgroup's founding member, Ronnie Duncan, and politely point out the oversight.

Click here to read the full article

How Does Your Property Insurance Compare?

While property taxes are the subject of a lot of conversation right now, property insurance has taken a bit of a back seat to it. Those living in Florida will remember that just a year ago many were getting cancellation notices or substantial increases in their annual premiums. Last week Governor Charlie Crist announced the launch of a new state-run website that serves as a starting point to help Floridians find the insurance policy best suited to their needs.

The website is: http://www.shopandcomparerates.com/ and here is how it works. Once on http://www.shopandcomparerates.com/, click on the button at the bottom to compare homeowner insurance rates, then select a county. A box will pop up showing you the cost to insure a fictional house in that county. The list of insurance companies is sorted from the lowest to highest cost. While you can't change the criteria of the "fictional house", it gives you an idea of comparable rates from different companies all in one place. The fictional house the website uses as an example is a five-year-old, concrete block home, with a current replacement value of $150,000, a $500 non-hurricane deductible, a 2 percent hurricane deductible, no claims and no wind mitigation discounts.

To see how your home would compare to what you currently have, you can click on the insurance company's name to get their phone number and website, then contact them with your specific needs.

Click here to read the full article

Florida Home Inspector Licensing Law

Quick quiz for you. What industry licensing, experience, and educational requirements does Florida Law require Home Inspectors to have. It may surprise you to learn that the answer is ZERO. While Realtors® and other professionals have tried for years to get the State to recognize the need for for such regulations, it is only now that something is being done about it.

Governor Charlie Crist just signed a bill (SB2234) into law that addresses this need. What this law does, is create the groundwork for a program to require licensing of home inspectors, mold assessors and remediators in Florida. Finally gaining enough support to materialize, the Legislature hopes this will "...ensure that consumers of home inspection services can rely on the competence of home inspectors..."

The good news is that this new law will require 120 hours of pre-license education and 14 hours of continuing education every two years. The bad news? The law doesn't go into effect for 3 more years (July 1, 2010). Over the next three years the Department of Business and Professional Regulation (DBPR) will create a program for certification, establish licensing fees and draft rules.

Click here to read the full article

Phase 1 Of Tax Plan Is Now The Law

On Thursday June 21, 2007 Gov. Charlie Crist signed into law the first phase of property tax reform which means a savings of about 6 or 7 percent to all property owners, including second homes and commercial property.

This is just the first phase, so Florida property owners shouldn't be disappointed on a relatively small first year's savings, estimated to be around $174 - $199. Florida voters will decide in late January, 2008 whether to adopt the second half of the plan.

If passed, the bipartisan law could slash up to $15.6 billion in local property taxes during the first five years. But those reductions would be spread across all classes of property. The Republican-sponsored constitutional amendment, however, could increase the total five-year cut to $31.6 billion, with owners of primary homes benefiting the most.

Critics of the plan (largely made up of Democrats, local officials, and labor unions) say the amendment is flawed for two reasons. First, they feel the amendment would cut too deeply into the budgets of cities, counties and school boards. Second, most of the savings would go to homesteads, which they say already receive substantial tax breaks. Opponents say the plan does not adequately help other residential properties and businesses hardest hit by real estate values that have skyrocketed in the last for or five years..

Click here to read the full article

Florida Voters To Decide Property Tax Fate

After regular sessions, special sessions and meetings in between, the Florida House and Senate have outlined more details on their property tax proposal. While the percentages of the exemptions are not as large as the first draft by House Speaker Marco Rubio (R-West Miami), they still mean significant savings to Florida home owners. More than $31 billion over the next 5 years, to be exact. Now, the voters in Florida will be voicing their opinions about more than Presidential Primaries come late January, 2008.

Here's how the proposed tiered property tax percentages would work:.

Homes valued up to $200,000: Properties would be taxed on 25% of their market value. There would be a minimum tax exemption of $50,000 (double the current homestead exemption of a flat $25,000). The next $300,000 of value would receive a 15% exemption. Let's take a look at a comparison between the proposal and the current Homestead Exemption.

Example 1, Value: $190,000
Proposed Plan: $190,000 x 25% = $47,500. Homeowner would pay property taxes on $47,500.
Current Exemption: $190,000 - $25,000 = $165,000. Homeowner pays property taxes on $165,000.

Example 2, Value: $350,000
Proposed Plan: $200,000 x 25% = $50,000 (Tier 1). $150,000 x 85% = $127,500 (Tier 2).
$50,000 + $127,500 = $177,500. Homeowner would pay property taxes on $177,500.
Current Exemption: $350,000 - $25,000 = $325,000. Homeowner pays property taxes on $325,000.

Future property tax increases, and their revenues, would be capped to coincide with personal income growth and new construction. Existing exemptions for disabled veterans, low income seniors, and agricultural land will not be eliminated by this plan.

This plan also calls for a current government "freeze" of this years revenue, then cut an additional percentage. In Hillsborough County the cut is 5%. That means trimming about $40 Million dollars worth of fat from the county budget. Those opposed to the new plan claim that the only way to free up that kind of money and receive less in the way of taxes is to cut some programs and drastically scale down others. The first things mentioned in the argument are closing fire stations, reducing head counts by laying off police, firefighters and EMT's, and closing libraries.

While the detailed amounts of the financial impact to the counties is not yet available, the implied economic doom and gloom has one flaw that can not be ignored. Property taxes and insurance have many potential homebuyers playing the waiting game. In a time where foreclosures are increasing, and others are worrying about it, out of control taxes and insurance have not helped the current real estate market condition. Many are afraid of buying a home right now, meanwhile the inventory of homes on the market are moving slower. With insurance issues beginning to be addressed in Tallahassee, a huge (tax) burden being relieved may be just what the doctor ordered...and just in time. More choices of insurers and dramatic tax reform could have a hand in kick starting a more active real estate market. Buyer confidence in attaining an affordable home means sellers may be able to breathe a little easier. After all, not everyone who is selling their house is moving out of the state. They may simply be moving up, downsizing, etc. Many of these sellers are also buyers...buyers who understand what the sellers are going through.

Over the next 6 to 7 months arguments for and against the proposed plan will be headline news across this state. It's as inevitable as the 3:00pm - 6:00pm thunderstorm on a Florida summer afternoon.

As more details find their way to the surface, I'll be sure to post them here. Don't forget to enter your e-mail address on this page to subscribe to updates. In the meantime, feel free to explore other articles in the archive.

Click here to read the full article

Florida Property Tax Reform Plan Decided, Almost

During a committee meeting earlier this week, the Florida Legislature took a big step forward in addressing a property tax reform plan. There is still a special legislative session set for June 12-22, but the reform plan is getting a little clearer. Here is what they agreed on.

Florida voters will have their say on property tax changes and restructuring proposals towards the end of January, 2008. Why then? To coincide with the presidential primary election. (The Legislature recently passed a new law that moved the primary from March to January to give Florida more influence on choosing presidential candidates.) Keep in mind that the state can not simply wave a wand and make major changes to property taxes, it takes a constitutional amendment to reform the system that is used.

House Speaker Marco Rubio (R-West Miami) and Senate President Ken Pruitt (R-Port St. Lucie) agreed last week on a basic outline for property tax reform. The plan would eliminate the current $25,000 homestead exemption for primary homes and likely most cases of the Save Our Homes Amendment. It would be replaced with a tiered, percentage-based exemption on primary homes.

For examples of this approach, see my earlier article on this here.

The Save Our Homes benefits would only be spared if they are better than the new plan, depending on each individual homeowner's scenario.

Exactly what percentages are to be used in each tier has not yet been agreed upon, but will be worked out while they hammer out the other details of the plan.

There also is an agreement for short term relief without an amendment, mostly addressing local government cuts based on recent increases and capping future taxes. Schools, they said, would be exempt from those tax cuts.

Click here to read the full article

May Market Report

Here is the real estate market report for May, 2007.

***Disclaimer***
The information I am posting is from a variety of resources and ultimately not all homes can possibly be accounted for due to public records errors, and the fact that there is no accurate comprehensive database for FSBO's (For Sale By Owner). Prices are rounded off for convenience and this data is for informational purposes only.

**Subscribe to my Blog to get notices of updated information and new articles! Just enter your e-mail address in the box below the For Sale By Andy logo!

MAY

Brandon
# Sold 64
Avg SP $244,000
Med SP $220,000
Avg DOM 96
Med DOM 78

Valrico
# Sold 69
Avg SP $278,000
Med SP $275,000
Avg DOM 95
Med DOM 74

Seffner
# Sold 21
Avg SP $195,000
Med SP $180,000
Avg DOM 154
Med DOM 134

Riverview
# Sold 108
Avg SP $235,000
Med SP $221,000
Avg DOM 99
Med DOM 75

Tampa
# Sold 630
Avg SP $291,000
Med SP $215,000
Avg DOM 108
Med DOM 76

Lithia
# Sold 23
Avg SP $392,000
Med SP $319,000
Avg DOM 131
Med DOM 107

Legend:
# Sold: Number of homes that sold during that month.
Avg SP: Average sold price of the homes sold.
Med SP: Median sold price of the homes sold.
Avg DOM: Average # of days those homes were active on the market.
Med DOM: Median # of days those homes were active on the market.

Click here to read the full article

Code Of Ethics, National Association of Realtors®

You've all seen the commercials on tv. The National Association of Realtors® (NAR®) mentions that Realtors® subscribe to a strict Code of Ethics. Well, as a means of providing you with the right information so you can make the best decision for you, I am posting the Code of Ethics here, with permission from NAR®.

Code of Ethics and Standards of Practice
of the NATIONAL ASSOCIATION OF REALTORS®
Effective January 1, 2006



Where the word REALTORS® is used in this Code and Preamble, it shall be deemed to include REALTOR-ASSOCIATE®s.

While the Code of Ethics establishes obligations that may be higher than those mandated by law, in any instance where the Code of Ethics and the law conflict, the obligations of the law must take precedence.

Preamble
Under all is the land. Upon its wise utilization and widely allocated ownership depend the survival and growth of free institutions and of our civilization. REALTORS® should recognize that the interests of the nation and its citizens require the highest and best use of the land and the widest distribution of land ownership. They require the creation of adequate housing, the building of functioning cities, the development of productive industries and farms, and the preservation of a healthful environment.

Such interests impose obligations beyond those of ordinary commerce. They impose grave social responsibility and a patriotic duty to which REALTORS® should dedicate themselves, and for which they should be diligent in preparing themselves. REALTORS®, therefore, are zealous to maintain and improve the standards of their calling and share with their fellow REALTORS® a common responsibility for its integrity and honor.

In recognition and appreciation of their obligations to clients, customers, the public, and each other, REALTORS® continuously strive to become and remain informed on issues affecting real estate and, as knowledgeable professionals, they willingly share the fruit of their experience and study with others. They identify and take steps, through enforcement of this Code of Ethics and by assisting appropriate regulatory bodies, to eliminate practices which may damage the public or which might discredit or bring dishonor to the real estate profession. REALTORS® having direct personal knowledge of conduct that may violate the Code of Ethics involving misappropriation of client or customer funds or property, willful discrimination, or fraud resulting in substantial economic harm, bring such matters to the attention of the appropriate Board or Association of REALTORS®. (Amended 1/00)

Realizing that cooperation with other real estate professionals promotes the best interests of those who utilize their services, REALTORS® urge exclusive representation of clients; do not attempt to gain any unfair advantage over their competitors; and they refrain from making unsolicited comments about other practitioners. In instances where their opinion is sought, or where REALTORS® believe that comment is necessary, their opinion is offered in an objective, professional manner, uninfluenced by any personal motivation or potential advantage or gain.

The term REALTOR® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal.

In the interpretation of this obligation, REALTORS® can take no safer guide than that which has been handed down through the centuries, embodied in the Golden Rule, “Whatsoever ye would that others should do to you, do ye even so to them.”

Accepting this standard as their own, REALTORS® pledge to observe its spirit in all of their activities and to conduct their business in accordance with the tenets set forth below.

Duties to Clients and Customers

Article 1
When representing a buyer, seller, landlord, tenant, or other client as an agent, REALTORS® pledge themselves to protect and promote the interests of their client. This obligation to the client is primary, but it does not relieve REALTORS® of their obligation to treat all parties honestly. When serving a buyer, seller, landlord, tenant or other party in a non-agency capacity, REALTORS® remain obligated to treat all parties honestly. (Amended 1/01)

• Standard of Practice 1-1
REALTORS®, when acting as principals in a real estate transaction, remain obligated by the duties imposed by the Code of Ethics. (Amended 1/93)

• Standard of Practice 1-2
The duties the Code of Ethics imposes are applicable whether REALTORS® are acting as agents or in legally recognized non-agency capacities except that any duty imposed exclusively on agents by law or regulation shall not be imposed by this Code of Ethics on REALTORS® acting in non-agency capacities.

As used in this Code of Ethics, “client” means the person(s) or entity(ies) with whom a REALTOR® or a REALTOR®’s firm has an agency or legally recognized non-agency relationship; “customer” means a party to a real estate transaction who receives information, services, or benefits but has no contractual relationship with the REALTOR® or the REALTOR®’s firm; “prospect” means a purchaser, seller, tenant, or landlord who is not subject to a representation relationship with the REALTOR® or REALTOR®’s firm; “agent” means a real estate licensee (including brokers and sales ASSOCIATEs) acting in an agency relationship as defined by state law or regulation; and “broker” means a real estate licensee (including brokers and sales ASSOCIATEs) acting as an agent or in a legally recognized non-agency capacity. (Adopted 1/95, Amended 1/04)

• Standard of Practice 1-3
REALTORS®, in attempting to secure a listing, shall not deliberately mislead the owner as to market value.

• Standard of Practice 1-4
REALTORS®, when seeking to become a buyer/tenant representative, shall not mislead buyers or tenants as to savings or other benefits that might be realized through use of the REALTOR®’s services. (Amended 1/93)



• Standard of Practice 1-5
REALTORS® may represent the seller/landlord and buyer/tenant in the same transaction only after full disclosure to and with informed consent of both parties. (Adopted 1/93)

• Standard of Practice 1-6
REALTORS® shall submit offers and counter-offers objectively and as quickly as possible. (Adopted 1/93, Amended 1/95)

• Standard of Practice 1-7
When acting as listing brokers, REALTORS® shall continue to submit to the seller/landlord all offers and counter-offers until closing or execution of a lease unless the seller/landlord has waived this obligation in writing. REALTORS® shall not be obligated to continue to market the property after an offer has been accepted by the seller/landlord. REALTORS® shall recommend that sellers/ landlords obtain the advice of legal counsel prior to acceptance of a subsequent offer except where the acceptance is contingent on the termination of the pre-existing purchase contract or lease. (Amended 1/93)

• Standard of Practice 1-8
REALTORS®, acting as agents or brokers of buyers/tenants, shall submit to buyers/tenants all offers and counter-offers until acceptance but have no obligation to continue to show properties to their clients after an offer has been accepted unless otherwise agreed in writing. REALTORS®, acting as agents or brokers of buyers/tenants, shall recommend that buyers/tenants obtain the advice of legal counsel if there is a question as to whether a pre-existing contract has been terminated. (Adopted 1/93, Amended 1/99)

• Standard of Practice 1-9
The obligation of REALTORS® to preserve confidential information (as defined by state law) provided by their clients in the course of any agency relationship or non-agency relationship recognized by law continues after termination of agency relationships or any non-agency relationships recognized by law. REALTORS® shall not knowingly, during or following the termination of professional relationships with their clients:
1) reveal confidential information of clients; or
2) use confidential information of clients to the disadvantage of clients; or
3) use confidential information of clients for the REALTOR®’s advantage or the advantage of third parties unless:
a) clients consent after full disclosure; or
b) REALTORS® are required by court order; or
c) it is the intention of a client to commit a crime and the information is necessary to prevent the crime; or
d) it is necessary to defend a REALTOR® or the REALTOR®’s employees or ASSOCIATEs against an accusation of wrongful conduct.

Information concerning latent material defects is not considered confidential information under this Code of Ethics. (Adopted 1/93, Amended 1/01)

• Standard of Practice 1-10
REALTORS® shall, consistent with the terms and conditions of their real estate licensure and their property management agreement, competently manage the property of clients with due regard for the rights, safety and health of tenants and others lawfully on the premises. (Adopted 1/95, Amended 1/00)

• Standard of Practice 1-11
REALTORS® who are employed to maintain or manage a client’s property shall exercise due diligence and make reasonable efforts to protect it against reasonably foreseeable contingencies and losses. (Adopted 1/95)

• Standard of Practice 1-12
When entering into listing contracts, REALTORS® must advise sellers/landlords of:
1) the REALTOR®’s company policies regarding cooperation and the amount(s) of any compensation that will be offered to subagents, buyer/tenant agents, and/or brokers acting in legally recognized non-agency capacities;
2) the fact that buyer/tenant agents or brokers, even if compensated by listing brokers, or by sellers/landlords may represent the interests of buyers/tenants; and
3) any potential for listing brokers to act as disclosed dual agents, e.g. buyer/tenant agents. (Adopted 1/93, Renumbered 1/98, Amended 1/03)

• Standard of Practice 1-13
When entering into buyer/tenant agreements, REALTORS® must advise potential clients of:
1) the REALTOR®’s company policies regarding cooperation;
2) the amount of compensation to be paid by the client;
3) the potential for additional or offsetting compensation from other brokers, from the seller or landlord, or from other parties;
4) any potential for the buyer/tenant representative to act as a disclosed dual agent, e.g. listing broker, subagent, landlord’s agent, etc., and
5) the possibility that sellers or sellers’ representatives may not treat the existence, terms, or conditions of offers as confidential unless confidentiality is required by law, regulation, or by any confidentiality agreement between the parties. (Adopted 1/93, Renumbered 1/98, Amended 1/06)

• Standard of Practice 1-14
Fees for preparing appraisals or other valuations shall not be contingent upon the amount of the appraisal or valuation. (Adopted 1/02)

• Standard of Practice 1-15
REALTORS®, in response to inquiries from buyers or cooperating brokers shall, with the sellers’ approval, disclose the existence of offers on the property. Where disclosure is authorized, REALTORS® shall also disclose whether offers were obtained by the listing licensee, another licensee in the listing firm, or by a cooperating broker. (Adopted 1/03, Amended 1/06)

Article 2
REALTORS® shall avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to the property or the transaction. REALTORS® shall not, however, be obligated to discover latent defects in the property, to advise on matters outside the scope of their real estate license, or to disclose facts which are confidential under the scope of agency or non-agency relationships as defined by state law. (Amended 1/00)

• Standard of Practice 2-1
REALTORS® shall only be obligated to discover and disclose adverse factors reasonably apparent to someone with expertise in those areas required by their real estate licensing authority. Article 2 does not impose upon the REALTOR® the obligation of expertise in other professional or technical disciplines. (Amended 1/96)
• Standard of Practice 2-2
(Renumbered as Standard of Practice 1-12 1/98)

• Standard of Practice 2-3
(Renumbered as Standard of Practice 1-13 1/98)

• Standard of Practice 2-4
REALTORS® shall not be parties to the naming of a false consideration in any document, unless it be the naming of an obviously nominal consideration.

• Standard of Practice 2-5
Factors defined as “non-material” by law or regulation or which are expressly referenced in law or regulation as not being subject to disclosure are considered not “pertinent” for purposes of Article 2. (Adopted 1/93)

Article 3
REALTORS® shall cooperate with other brokers except when cooperation is not in the client’s best interest. The obligation to cooperate does not include the obligation to share commissions, fees, or to otherwise compensate another broker. (Amended 1/95)

• Standard of Practice 3-1
REALTORS®, acting as exclusive agents or brokers of sellers/ landlords, establish the terms and conditions of offers to cooperate. Unless expressly indicated in offers to cooperate, cooperating brokers may not assume that the offer of cooperation includes an offer of compensation. Terms of compensation, if any, shall be ascertained by cooperating brokers before beginning efforts to accept the offer of cooperation. (Amended 1/99)

• Standard of Practice 3-2
REALTORS® shall, with respect to offers of compensation to another REALTOR®, timely communicate any change of compensation for cooperative services to the other REALTOR® prior to the time such REALTOR® produces an offer to purchase/lease the property. (Amended 1/94)

• Standard of Practice 3-3
Standard of Practice 3-2 does not preclude the listing broker and cooperating broker from entering into an agreement to change cooperative compensation. (Adopted 1/94)

• Standard of Practice 3-4
REALTORS®, acting as listing brokers, have an affirmative obligation to disclose the existence of dual or variable rate commission arrangements (i.e., listings where one amount of commission is payable if the listing broker’s firm is the procuring cause of sale/lease and a different amount of commission is payable if the sale/lease results through the efforts of the seller/landlord or a cooperating broker). The listing broker shall, as soon as practical, disclose the existence of such arrangements to potential cooperating brokers and shall, in response to inquiries from cooperating brokers, disclose the differential that would result in a cooperative transaction or in a sale/lease that results through the efforts of the seller/landlord. If the cooperating broker is a buyer/tenant representative, the buyer/tenant representative must disclose such information to their client before the client makes an offer to purchase or lease. (Amended 1/02)

• Standard of Practice 3-5
It is the obligation of subagents to promptly disclose all pertinent facts to the principal’s agent prior to as well as after a purchase or lease agreement is executed. (Amended 1/93)

• Standard of Practice 3-6
REALTORS® shall disclose the existence of accepted offers, including offers with unresolved contingencies, to any broker seeking cooperation. (Adopted 5/86, Amended 1/04)

• Standard of Practice 3-7
When seeking information from another REALTOR® concerning property under a management or listing agreement, REALTORS® shall disclose their REALTOR® status and whether their interest is personal or on behalf of a client and, if on behalf of a client, their representational status. (Amended 1/95)

• Standard of Practice 3-8
REALTORS® shall not misrepresent the availability of access to show or inspect a listed property. (Amended 11/87)

Article 4
REALTORS® shall not acquire an interest in or buy or present offers from themselves, any member of their immediate families, their firms or any member thereof, or any entities in which they have any ownership interest, any real property without making their true position known to the owner or the owner’s agent or broker. In selling property they own, or in which they have any interest, REALTORS® shall reveal their ownership or interest in writing to the purchaser or the purchaser’s representative. (Amended 1/00)
• Standard of Practice 4-1
For the protection of all parties, the disclosures required by Article 4 shall be in writing and provided by REALTORS® prior to the signing of any contract. (Adopted 2/86)

Article 5
REALTORS® shall not undertake to provide professional services concerning a property or its value where they have a present or contemplated interest unless such interest is specifically disclosed to all affected parties.

Article 6
REALTORS® shall not accept any commission, rebate, or profit on expenditures made for their client, without the client’s knowledge and consent.

When recommending real estate products or services (e.g., homeowner’s insurance, warranty programs, mortgage financing, title insurance, etc.), REALTORS® shall disclose to the client or customer to whom the recommendation is made any financial benefits or fees, other than real estate referral fees, the REALTOR® or REALTOR®’s firm may receive as a direct result of such recommendation. (Amended 1/99)

• Standard of Practice 6-1
REALTORS® shall not recommend or suggest to a client or a customer the use of services of another organization or business entity in which they have a direct interest without disclosing such interest at the time of the recommendation or suggestion. (Amended 5/88)

Article 7
In a transaction, REALTORS® shall not accept compensation from more than one party, even if permitted by law, without disclosure to all parties and the informed consent of the REALTOR®’s client or clients. (Amended 1/93)

Article 8
REALTORS® shall keep in a special account in an appropriate financial institution, separated from their own funds, monies coming into their possession in trust for other persons, such as escrows, trust funds, clients’ monies, and other like items.


Article 9
REALTORS®, for the protection of all parties, shall assure whenever possible that all agreements related to real estate transactions including, but not limited to, listing and representation agreements, purchase contracts, and leases are in writing in clear and understandable language expressing the specific terms, conditions, obligations and commitments of the parties. A copy of each agreement shall be furnished to each party to such agreements upon their signing or initialing. (Amended 1/04)

• Standard of Practice 9-1
For the protection of all parties, REALTORS® shall use reasonable care to ensure that documents pertaining to the purchase, sale, or lease of real estate are kept current through the use of written extensions or amendments. (Amended 1/93)


Duties to the Public

Article 10
REALTORS® shall not deny equal professional services to any person for reasons of race, color, religion, sex, handicap, familial status, or national origin. REALTORS® shall not be parties to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status, or national origin. (Amended 1/90)

REALTORS®, in their real estate employment practices, shall not discriminate against any person or persons on the basis of race, color, religion, sex, handicap, familial status, or national origin. (Amended 1/00)

• Standard of Practice 10-1
When involved in the sale or lease of a residence, REALTORS® shall not volunteer information regarding the racial, religious or ethnic composition of any neighborhood nor shall they engage in any activity which may result in panic selling, however, REALTORS® may provide other demographic information. (Adopted 1/94, Amended 1/06)

• Standard of Practice 10-2
When not involved in the sale or lease of a residence, REALTORS® may provide demographic information related to a property, transaction or professional assignment to a party if such demographic information is (a) deemed by the REALTOR® to be needed to assist with or complete, in a manner consistent with Article 10, a real estate transaction or professional assignment and (b) is obtained or derived from
a recognized, reliable, independent, and
impartial source. The source of such information and any additions, deletions, modifications, interpretations, or other changes shall be disclosed in reasonable detail. (Adopted 1/05, Renumbered 1/06)

• Standard of Practice 10-3
REALTORS® shall not print, display or circulate any statement or advertisement with respect to selling or renting of a property that indicates any preference, limitations or discrimination based on race, color, religion, sex, handicap, familial status, or national origin. (Adopted 1/94, Renumbered 1/05 and 1/06)

• Standard of Practice 10-4
As used in Article 10 “real estate employment practices” relates to employees and independent contractors providing real estate-related services and the administrative and clerical staff directly supporting those individuals. (Adopted 1/00, Renumbered 1/05 and 1/06)

Article 11
The services which REALTORS® provide to their clients and customers shall conform to the standards of practice and competence which are reasonably expected in the specific real estate disciplines in which they engage; specifically, residential real estate brokerage, real property management, commercial and industrial real estate brokerage, real estate appraisal, real estate counseling, real estate syndication, real estate auction, and international real estate.

REALTORS® shall not undertake to provide specialized professional services concerning a type of property or service that is outside their field of competence unless they engage the assistance of one who is competent on such types of property or service, or unless the facts are fully disclosed to the client. Any persons engaged to provide such assistance shall be so identified to the client and their contribution to the assignment should be set forth. (Amended 1/95)

• Standard of Practice 11-1
When REALTORS® prepare opinions of real property value or price, other than in pursuit of a listing or to assist a potential purchaser in formulating a purchase offer, such opinions shall include the following:
1) identification of the subject property
2) date prepared
3) defined value or price
4) limiting conditions, including statements of purpose(s) and intended user(s)
5) any present or contemplated interest, including the possibility of representing the seller/landlord or buyers/tenants
6) basis for the opinion, including applicable market data
7) if the opinion is not an appraisal, a statement to that effect (Amended 1/01)

• Standard of Practice 11-2
The obligations of the Code of Ethics in respect of real estate disciplines other than appraisal shall be interpreted and applied in accordance with the standards of competence and practice which clients and the public reasonably require to protect their rights and interests considering the complexity of the transaction, the availability of expert assistance, and, where the REALTOR® is an agent or subagent, the obligations of a fiduciary. (Adopted 1/95)

• Standard of Practice 11-3
When REALTORS® provide consultive services to clients which involve advice or counsel for a fee (not a commission), such advice shall be rendered in an objective manner and the fee shall not be contingent on the substance of the advice or counsel given. If brokerage or transaction services are to be provided in addition to consultive services, a separate compensation may be paid with prior agreement between the client and REALTOR®. (Adopted 1/96)

• Standard of Practice 11-4
The competency required by Article 11 relates to services contracted for between REALTORS® and their clients or customers; the duties expressly imposed by the Code of Ethics; and the duties imposed by law or regulation. (Adopted 1/02)

Article 12
REALTORS® shall be careful at all times to present a true picture in their advertising and representations to the public. REALTORS® shall also ensure that their professional status (e.g., broker, appraiser, property manager, etc.) or status as REALTORS® is clearly identifiable in any such advertising. (Amended 1/93)

• Standard of Practice 12-1
REALTORS® may use the term “free” and similar terms in their advertising and in other representations provided that all terms governing availability of the offered product or service are clearly disclosed at the same time. (Amended 1/97)

• Standard of Practice 12-2
REALTORS® may represent their services as “free” or without cost even if they expect to receive compensation from a source other than their client provided that the potential for the REALTOR® to obtain a benefit from a third party is clearly disclosed at the same time. (Amended 1/97)

• Standard of Practice 12-3
The offering of premiums, prizes, merchandise discounts or other inducements to list, sell, purchase, or lease is not, in itself, unethical even if receipt of the benefit is contingent on listing, selling, purchasing, or leasing through the REALTOR® making the offer. However, REALTORS® must exercise care and candor in any such advertising or other public or private representations so that any party interested in receiving or otherwise benefiting from the REALTOR®’s offer will have clear, thorough, advance understanding of all the terms and conditions of the offer. The offering of any inducements to do business is subject to the limitations and restrictions of state law and the ethical obligations established by any applicable Standard of Practice. (Amended 1/95)

• Standard of Practice 12-4
REALTORS® shall not offer for sale/lease or advertise property without authority. When acting as listing brokers or as subagents, REALTORS® shall not quote a price different from that agreed upon with the seller/landlord. (Amended 1/93)

• Standard of Practice 12-5
REALTORS® shall not advertise nor permit any person employed by or affiliated with them to advertise listed property without disclosing the name of the firm. (Adopted 11/86)

• Standard of Practice 12-6
REALTORS®, when advertising unlisted real property for sale/lease in which they have an ownership interest, shall disclose their status as both owners/landlords and as REALTORS® or real estate licensees. (Amended 1/93)


• Standard of Practice 12-7
Only REALTORS® who participated in the transaction as the listing broker or cooperating broker (selling broker) may claim to have “sold” the property. Prior to closing, a cooperating broker may post a “sold” sign only with the consent of the listing broker. (Amended 1/96)

Article 13
REALTORS® shall not engage in activities that constitute the unauthorized practice of law and shall recommend that legal counsel be obtained when the interest of any party to the transaction requires it.

Article 14
If charged with unethical practice or asked to present evidence or to cooperate in any other way, in any professional standards proceeding or investigation, REALTORS® shall place all pertinent facts before the proper tribunals of the Member Board or affiliated institute, society, or council in which membership is held and shall take no action to disrupt or obstruct such processes. (Amended 1/99)

• Standard of Practice 14-1
REALTORS® shall not be subject to disciplinary proceedings in more than one Board of REALTORS® or affiliated institute, society or council in which they hold membership with respect to alleged violations of the Code of Ethics relating to the same transaction or event. (Amended 1/95)

• Standard of Practice 14-2
REALTORS® shall not make any unauthorized disclosure or dissemination of the allegations, findings, or decision developed in connection with an ethics hearing or appeal or in connection with an arbitration hearing or procedural review. (Amended 1/92)

• Standard of Practice 14-3
REALTORS® shall not obstruct the Board’s investigative or professional standards proceedings by instituting or threatening to institute actions for libel, slander or defamation against any party to a professional standards proceeding or their witnesses based on the filing of an arbitration request, an ethics complaint, or testimony given before any tribunal. (Adopted 11/87, Amended 1/99)


• Standard of Practice 14-4
REALTORS® shall not intentionally impede the Board’s investigative or disciplinary proceedings by filing multiple ethics complaints based on the same event or transaction. (Adopted 11/88)
Duties to REALTORS®

Duties to the REALTORS®

Article 15
REALTORS® shall not knowingly or recklessly make false or misleading statements about competitors, their businesses, or their business practices. (Amended 1/92)

• Standard of Practice 15-1
REALTORS® shall not knowingly or recklessly file false or unfounded ethics complaints. (Adopted 1/00)

Article 16
REALTORS® shall not engage in any practice or take any action inconsistent with exclusive representation or exclusive brokerage relationship agreements that other REALTORS® have with clients. (Amended 1/04)

• Standard of Practice 16-1
Article 16 is not intended to prohibit aggressive or innovative business practices which are otherwise ethical and does not prohibit disagreements with other REALTORS® involving commission, fees, compensation or other forms of payment or expenses. (Adopted 1/93, Amended 1/95)

• Standard of Practice 16-2
Article 16 does not preclude REALTORS® from making general announcements to prospects describing their services and the terms of their availability even though some recipients may have entered into agency agreements or other exclusive relationships with another REALTOR®. A general telephone canvass, general mailing or distribution addressed to all prospects in a given geographical area or in a given profession, business, club, or organization, or other classification or group is deemed “general” for purposes of this standard. (Amended 1/04)

Article 16 is intended to recognize as unethical two basic types of solicitations:

First, telephone or personal solicitations of property owners who have been identified by a real estate sign, multiple listing compilation, or other information service as having exclusively listed their property with another REALTOR®; and

Second, mail or other forms of written solicitations of prospects whose properties are exclusively listed with another REALTOR® when such solicitations are not part of a general mailing but are directed specifically to property owners identified through compilations of current listings, “for sale” or “for rent” signs, or other sources of information required by Article 3 and Multiple Listing Service rules to be made available to other REALTORS® under offers of subagency or cooperation. (Amended 1/04)

• Standard of Practice 16-3
Article 16 does not preclude REALTORS® from contacting the client of another broker for the purpose of offering to provide, or entering into a contract to provide, a different type of real estate service unrelated to the type of service currently being provided (e.g., property management as opposed to brokerage) or from offering the same type of service for property not subject to other brokers’ exclusive agreements. However, information received through a Multiple Listing Service or any other offer of cooperation may not be used to target clients of other REALTORS® to whom such offers to provide services may be made. (Amended 1/04)

• Standard of Practice 16-4
REALTORS® shall not solicit a listing which is currently listed exclusively with another broker. However, if the listing broker, when asked by the REALTOR®, refuses to disclose the expiration date and nature of such listing; i.e., an exclusive right to sell, an exclusive agency, open listing, or other form of contractual agreement between the listing broker and the client, the REALTOR® may contact the owner to secure such information and may discuss the terms upon which the REALTOR® might take a future listing or, alternatively, may take a listing to become effective upon expiration of any existing exclusive listing. (Amended 1/94)

• Standard of Practice 16-5
REALTORS® shall not solicit buyer/tenant agreements from buyers/ tenants who are subject to exclusive buyer/tenant agreements. However, if asked by a REALTOR®, the broker refuses to disclose the expiration date of the exclusive buyer/tenant agreement, the REALTOR® may contact the buyer/tenant to secure such information and may discuss the terms upon which the REALTOR® might enter into a future buyer/tenant agreement or, alternatively, may enter into a buyer/tenant agreement to become effective upon the expiration of any existing exclusive buyer/tenant agreement. (Adopted 1/94, Amended 1/98)

• Standard of Practice 16-6
When REALTORS® are contacted by the client of another REALTOR® regarding the creation of an exclusive relationship to provide the same type of service, and REALTORS® have not directly or indirectly initiated such discussions, they may discuss the terms upon which they might enter into a future agreement or, alternatively, may enter into an agreement which becomes effective upon expiration of any existing exclusive agreement. (Amended 1/98)

• Standard of Practice 16-7
The fact that a prospect has retained a REALTOR® as an exclusive representative or exclusive broker in one or more past transactions does not preclude other REALTORS® from seeking such prospect’s future business. (Amended 1/04)

• Standard of Practice 16-8
The fact that an exclusive agreement has been entered into with a REALTOR® shall not preclude or inhibit any other REALTOR® from entering into a similar agreement after the expiration of the prior agreement. (Amended 1/98)

• Standard of Practice 16-9
REALTORS®, prior to entering into a representation agreement, have an affirmative obligation to make reasonable efforts to determine whether the prospect is subject to a current, valid exclusive agreement to provide the same type of real estate service. (Amended 1/04)

• Standard of Practice 16-10
REALTORS®, acting as buyer or tenant representatives or brokers, shall disclose that relationship to the seller/landlord’s representative or broker at first contact and shall provide written confirmation of that disclosure to the seller/ landlord’s representative or broker not later than execution of a purchase agreement or lease. (Amended 1/04)

• Standard of Practice 16-11
On unlisted property, REALTORS® acting as buyer/tenant representatives or brokers shall disclose that relationship to the seller/landlord at first contact for that buyer/tenant and shall provide written confirmation of such disclosure to the seller/landlord not later than execution of any purchase or lease agreement. (Amended 1/04)

REALTORS® shall make any request for anticipated compensation from the seller/landlord at first contact. (Amended 1/98)

• Standard of Practice 16-12
REALTORS®, acting as representatives or brokers of sellers/landlords or as subagents of listing brokers, shall disclose that relationship to buyers/tenants as soon as practicable and shall provide written confirmation of such disclosure to buyers/tenants not later than execution of any purchase or lease agreement. (Amended 1/04)

• Standard of Practice 16-13
All dealings concerning property exclusively listed, or with buyer/tenants who are subject to an exclusive agreement shall be carried on with the client’s representative or broker, and not with the client, except with the consent of the client’s representative or broker or except where such dealings are initiated by the client.

Before providing substantive services (such as writing a purchase offer or presenting a CMA) to prospects, REALTORS® shall ask prospects whether they are a party to any exclusive representation agreement. REALTORS® shall not knowingly provide substantive services concerning a prospective transaction to prospects who are parties to exclusive representation agreements, except with the consent of the prospects’ exclusive representatives or at the direction of prospects. (Adopted 1/93, Amended 1/04)

• Standard of Practice 16-14
REALTORS® are free to enter into contractual relationships or to negotiate with sellers/ landlords, buyers/tenants or others who are not subject to an exclusive agreement but shall not knowingly obligate them to pay more than one commission except with their informed consent. (Amended 1/98)

• Standard of Practice 16-15
In cooperative transactions REALTORS® shall compensate cooperating REALTORS® (principal brokers) and shall not compensate nor offer to compensate, directly or indirectly, any of the sales
licensees employed by or affiliated with other REALTORS® without the prior express knowledge and consent of the cooperating broker.

• Standard of Practice 16-16
REALTORS®, acting as subagents or buyer/tenant representatives or brokers, shall not use the terms of an offer to purchase/lease to attempt to modify the listing broker’s offer of compensation to subagents or buyer/tenant representatives or brokers nor make the submission of an executed offer to purchase/lease contingent on the listing broker’s agreement to modify the offer of compensation. (Amended 1/04)

• Standard of Practice 16-17
REALTORS®, acting as subagents or as buyer/tenant representatives or brokers, shall not attempt to extend a listing broker’s offer of cooperation and/or compensation to other brokers without the consent of the listing broker. (Amended 1/04)

• Standard of Practice 16-18
REALTORS® shall not use information obtained from listing brokers through offers to cooperate made through multiple listing services or through other offers of cooperation to refer listing brokers’ clients to other brokers or to create buyer/tenant relationships with listing brokers’ clients, unless such use is authorized by listing brokers. (Amended 1/02)

• Standard of Practice 16-19
Signs giving notice of property for sale, rent, lease, or exchange shall not be placed on property without consent of the seller/landlord. (Amended 1/93)

• Standard of Practice 16-20
REALTORS®, prior to or after terminating their relationship with their current firm, shall not induce clients of their current firm to cancel exclusive contractual agreements between the client and that firm. This does not preclude REALTORS® (principals) from establishing agreements with their ASSOCIATEd licensees governing assignability of exclusive agreements. (Adopted 1/98)

Article 17
In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORS® (principals) ASSOCIATEd with different firms, arising out of their relationship as REALTORS®, the REALTORS® shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter.
In the event clients of REALTORS® wish to arbitrate contractual disputes arising out of real estate transactions, REALTORS® shall arbitrate those disputes in accordance with the regulations of their Board, provided the clients agree to be bound by the decision.

The obligation to participate in arbitration contemplated by this Article includes the obligation of REALTORS® (principals) to cause their firms to arbitrate and be bound by any award. (Amended 1/01)

• Standard of Practice 17-1
The filing of litigation and refusal to withdraw from it by REALTORS® in an arbitrable matter constitutes a refusal to arbitrate. (Adopted 2/86)

• Standard of Practice 17-2
Article 17 does not require REALTORS® to arbitrate in those circumstances when all parties to the dispute advise the Board in writing that they choose not to arbitrate before the Board.
(Amended 1/93)

• Standard of Practice 17-3
REALTORS®, when acting solely as principals in a real estate transaction, are not obligated to arbitrate disputes with other REALTORS® absent a specific written agreement to the contrary. (Adopted 1/96)

• Standard of Practice 17-4
Specific non-contractual disputes that are subject to arbitration pursuant to Article 17 are:

1) Where a listing broker has compensated a cooperating broker and another cooperating broker subsequently claims to be the procuring cause of the sale or lease. In such cases the complainant may name the first cooperating broker as respondent and arbitration may proceed without the listing broker being named as a respondent. Alternatively, if the complaint is brought against the listing broker, the listing broker may name the first cooperating broker as a third-party respondent. In either instance the decision of the hearing panel as to procuring cause shall be conclusive with respect to all current or subsequent claims of the parties for compensation arising out of the underlying cooperative transaction. (Adopted 1/97)

2) Where a buyer or tenant representative is compensated by the seller or landlord, and not by the listing broker, and the listing broker, as a result, reduces the commission owed by the seller or landlord and, subsequent to such actions, another cooperating broker claims to be the procuring cause of sale or lease. In such cases the complainant may name the first cooperating broker as respondent and arbitration may proceed without the listing broker being named as a respondent. Alternatively, if the complaint is brought against the listing broker, the listing broker may name the first cooperating broker as a third-party respondent. In either instance the decision of the hearing panel as to procuring cause shall be conclusive with respect to all current or subsequent claims of the parties for compensation arising out of the underlying cooperative transaction. (Adopted 1/97)

3) Where a buyer or tenant representative is compensated by the buyer or tenant and, as a result, the listing broker reduces the commission owed by the seller or landlord and, subsequent to such actions, another cooperating broker claims to be the procuring cause of sale or lease. In such cases the complainant may name the first cooperating broker as respondent and arbitration may proceed without the listing broker being named as a respondent. Alternatively, if the complaint is brought against the listing broker, the listing broker may name the first cooperating broker as a third-party respondent. In either instance the decision of the hearing panel as to procuring cause shall be conclusive with respect to all current or subsequent claims of the parties for compensation arising out of the underlying cooperative transaction. (Adopted 1/97)

4) Where two or more listing brokers claim entitlement to compensation pursuant to open listings with a seller or landlord who agrees to participate in arbitration (or who requests arbitration) and who agrees to be bound by the decision. In cases where one of the listing brokers has been compensated by the seller or landlord, the other listing broker, as complainant, may name the first listing broker as respondent and arbitration may proceed between the brokers. (Adopted 1/97)



5) Where a buyer or tenant representative is compensated by the seller or landlord, and not by the listing broker, and the listing broker, as a result, reduces the commission owed by the seller or landlord and, subsequent to such actions, claims to be the procuring cause of sale or lease. In such cases arbitration shall be between the listing broker and the buyer or tenant representative and the amount in dispute is limited to the amount of the reduction of commission to which the listing broker agreed. (Adopted 1/05)

The Code of Ethics was adopted in 1913. Amended at the Annual Convention in 1924, 1928, 1950, 1951, 1952, 1955, 1956, 1961, 1962, 1974, 1982, 1986, 1987, 1989, 1990, 1991, 1992, 1993, 1994, 1995, 1996, 1997, 1998, 1999, 2000, 2001, 2002, 2003, 2004 and 2005.

Explanatory Notes
The reader should be aware of the following policies which have been approved by the Board of Directors of the National Association:

In filing a charge of an alleged violation of the Code of Ethics by a REALTOR®, the charge must read as an alleged violation of one or more Articles of the Code. Standards of Practice may be cited in support of the charge.

The Standards of Practice serve to clarify the ethical obligations imposed by the various Articles and supplement, and do not substitute for, the Case Interpretations in Interpretations of the Code of Ethics.

Modifications to existing Standards of Practice and additional new Standards of Practice are approved from time to time. Readers are cautioned to ensure that the most recent publications are utilized.

(c) 2006 NATIONAL ASSOCIATION OF REALTORS®, All rights Reserved.

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