Multiple Offers Currently Are the New Normal

Real Estate Update

I was asked recently about the percentage of sales at South Lake Tahoe that had sold above the seller’s asking price in the last 30 days. Based on a total of 137 single family home sales the numbers I saw caught my attention. Especially when compared to last years numbers.

Forty percent of the properties sold in the last month were above the asking price which was to be expected with the lack of current inventory. 43% were sold below the asking price. Further research showed most of those properties had been on the market for over 60 days or were homes priced over $1,000,000.

Only 17% were sold at the asking price. Regarding properties priced over $1,000,000 only 2 of 16 residences sold above the asking price.

Looking back on 2019 as a reference there were only 62 single family sales during the same time period. That was 55% less than this years sales during the same time period. Plus there were only 6% of the properties sold above the asking price as compared to 40% in 2020. 81% sold below the seller’s asking price, and 13% sold at the seller’s asking price. Who knew? Now you do.

September 13, 2020

New Tahoe Key’s Listing – 1986 Garmish Ct

1986 Garmish Ct

The owners have decided to sell their Tahoe Keys waterfront home after a water line leak from their refrigerator 2 years ago. All remediation work has been completed and the residence is awaiting new owners to rebuild.  Priced to sell this residence could be an investors next project or a future homeowners blank canvas to construct the home of your dreams. Located on a quiet cul-de-sac street with your own private dock this particular property has a bit more space around it than most Key’s homes.  One of our areas neighborhood parks is located across from the dock so enjoy the scenery and the beautiful views of our local mountains each evening from your own rear deck.  Hoping to see you soon, this residence is available to show anytime. Asking $675,000. Contact Robert Stiles at 530-314-0352 to show anytime.

C.A.R. Legal Guidance on Open Houses – as of 7/2/20

Coronavirus

There still seems to be some confusion in the state regarding the legality of holding open houses, says the California Association of Realtors (C.A.R.). Please be reminded that open houses are not currently permitted in California. The mandatory Industry Guidance states “Discontinue holding open houses and showings open to the general public on a walk-in basis; use an appointment or digital sign-in process to control the number of people in the house or property.” Thus, the only way to show property is by making an appointment in advance. Visitors viewing a house should be from one buying party only and the number of persons in the property is limited by the requirement of social distancing. In addition, the property must be thoroughly cleaned before and after each showing.


Open houses are generally understood to be on a walk-in basis without needing an appointment. Appointment-based showings are not “open houses” in the general understanding of the industry and the public. Therefore, to present a true picture under Article 12 of the Code of Ethics, REALTORS® should conform to the normal understanding of the term.


In other words, REALTORS® should not be putting up Open House signs at all, because if they are advertising a traditional open house they are promoting an unlawful activity, and if they are advertising an “open house” that really isn’t an open house, they are arguably not presenting a true picture in their advertising.

Business Email Compromise

NV Assoc of Realtors

— Think Twice Before Clicking Send —

Christal Park Keegan
NVR Legal Info. Line Attorney


Cybercrimes against real estate transactions are increasing and unsecured email correspondences are a target. Realtors® need to beware that hackers can intercept emails between clients and real estate agents that could enable the thief to steal funds. Further, you can be held liable to the victim for negligent cybersecurity, as was the case where a jury found in favor of the buyer and entered a verdict of $170,000 against the listing agent and broker (Bain v. Platinum Realty, LLC, D. Kan. 2018). It’s crucial that all parties involved in the transaction are diligent in their communication and take necessary precautions to protect Personal Identifying Information (PII).


NVR’s LIL Attorney Christal offers members some best practices based on Nevada law NRS 603A, along with information provided by the National Association of REALTORS® (NAR), as well as feedback from title companies.

Encrypt email and attachments. In addition to checking your email settings for encryption capabilities, there are numerous companies (such as Virtru and ShareFile) that provide this service. Although an original email may be encrypted, it’s important for brokers and their agents to know that when an email is forwarded it is not encrypted.


Do not email unredacted earnest money deposit (EMD) checks. Doing so violates NRS 603A because it includes a client’s PII. Take care on who is copied on emails that include EMD checks and only include persons absolutely necessary. Consider letting the title company directly reach out to your clients to get the information they need, which limits your exposure to a potential mishandling of PII claim.


Be patient with log-in issues with encrypted and/or multi-step authentication emails. Understand that requesting the title company to send a PDF of an attachment to bypass multi-step verification processes violates NRS 603A. Call the title company and troubleshoot the issues or seek in-house IT assistance if available.


Check your E&O insurance coverage. Ensure it covers business email compromising events. In light of wire fraud scams, ask about social engineering and impersonation
coverage.


Consider the timing of social media postings. Hackers lie in wait, silently monitoring real estate transactions, until the most opportune moment to strike. Consider delaying posts of upcoming and real-time closing signings so as not give the criminals a heads-up.


Do not log in to public WiFi. Hackers, malware and other threats pose security risks. When using your business email ensure you are on a secured network.


Install anti-malware protection and regularly update it. At a very minimum, a computer itself should be protected with basic anti-malware software. Monitor email accounts for unrecognized activity and regularly purge unneeded emails from your account. Check your email settings to ensure your emails aren’t being impermissibly copied and forwarded. Never click on links or attachments in unverified emails because they may deploy malware.


Every single agent, staff member, and employee should be trained on best email handling practices. Often data breaches result from negligence on the part of an otherwise well-meaning employee. Make sure everyone on your team is on the same page.


RESOURCES
(Differerent web browsers treat various links in different ways. If a link does not seem to be clickable, try copying and pasting the link directly into your web browser.)


The NAR shares several examples of wire fraud notices used by other REALTOR® associations as an educational and risk management tool to protect real estate professionals from liability related to wire fraud:
•https://www.nar.realtor/data-privacysecurity/wire-fraud-notices


Numerous federal agencies have issued warnings and tips, including the Consumer Financial Protection Bureau, the Federal Trade Commission (in cooperation with NAR) and the FBI/IC3.
•https://www.consumerfinance.gov/about-us/blog/mortgage-closing-scams-howprotect-yourself-and-your-closing-funds/
•https://www.consumer.ftc.gov/blog/2017/06/protect-your-mortgageclosing-scammers
•https://www.ic3.gov/media/2018/180712.aspx


The National Institute of Standards and Technology offers the “Guide to Protecting the Confidentiality of Personally Identifiable Information.”
•https://nvlpubs.nist.gov/nistpubs/Legacy/
SP/nistspecialpublication800-122.pdf


The NAR provides a Toolkit which includes information about data security and privacy protection, as well as various helpful checklists on issues to consider when drafting a tailored security program:
•https://www.nar.realtor/sites/default/files/documents/Data%20Privacy%20and%20Security%20Toolkit_081117_rev.pdf
Washoe County Sherriff’s Office, specifically See Tip #12 Escrow Services Fraud:
•https://www.washoesheriff.com/sub.
php?page=cyber-security-awarenesstips&expand=General%20Information

•Statements made by the Nevada REALTORS® Legal Information Line attorneys on the telephone, in e-mails, or in legal e-news articles are for informational purposes only. Nevada REALTORS® staff attorneys provide general legal information, not legal representation or advice regarding your real estate related questions. No attorney-client relationship is created by your use of the Legal Information Line. You should not act upon information you receive without seeking independent legal counsel. Information given over the Legal Information Line or in these articles is for your benefit only. Do not practice law or give legal advice to your clients! Inform your clients they must seek their own legal advice.

Seven Changes of the Paycheck Protection Program Flexibility Act of 2020

On June 3, the U.S. Senate passed the PPP Flexibility Act of 2020, which places a more rigorous requirement to spend a minimum of 60 percent of the loan proceeds on payroll costs in order to qualify for loan forgiveness. Previously, this requirement was 75 percent of the forgiveness amount. The bill does not alter many other rules of forgiveness, including the FTE reduction or salary/wage reduction calculations, affiliation rules, certification of economic uncertainty, and the necessity of loan request.

Here are the seven most notable changes to the PPP:

  1. The maturity of loans is extended to a minimum of five years. This provision applies only to loans entered into on or after the date that the bill is enacted.
  2. As mentioned above, borrowers are required to spend at least 60 percent of the loan proceeds on payroll costs in order to be eligible for loan forgiveness.
  3. The Covered Period extends to the earlier of (i) 24 weeks from the date of disbursement of PPP loan funds to the borrower, or (ii) December 31, 2020. Existing borrowers with loan origination dates prior to enactment of this Act can elect to keep their Covered Period at eight weeks from the date of loan fund disbursement.
  4. The time period employers have to rehire former employees (or hire new ones in their place) and restore salary levels is extended to December 31, 2020 from June 30, 2020.
  5. For the purposes of determining loan forgiveness, consideration of the employment level of a company is prohibited as long as the borrower, in good faith, can document that the company was unable to: 
    1. Rehire individuals that were employees of the eligible recipient on February 15, 2020; AND
    2. Hire someone of similar qualifications as a former employee by December 31, 2020; OR
    3. Return to the same level of activity the business was operating at before February 15, 2020, due to their compliance with guidelines or requirements related to the pandemic issued by the CDC, the Department of Health and Human Services, or the Occupational Safety and Health Administration (OSHA).
  6. Payments of interest and principal are deferred until the SBA remits—to the lender—the amount of forgiveness granted to the borrower, provided the borrower applies for PPP loan forgiveness within 10 months of the end of the covered period.
  7. Companies receiving PPP loan forgiveness will no longer be ineligible for the delay of payment of employer payroll taxes.

Showing Requirements during Covid

I wanted to provide a quick update to let you know how things are changing and adjusting – again.  Hopefully some of these changes will make things easier on you.
Last week, the state of California issued guidance (new law) for showing practices during the pandemic in coordination with Cal Osha and the Department of Public Health.  For the most part, they adopted the California Association of REALTORS (C.A.R.’s) Best Practices with some changes.
All Brokers must have a plan and rules for showing property.  To satisfy the state requirement:
1-The Best Practices are no longer a recommendation, they are now law and required.  C.A.R. is updating them to include everything that the state added in their last update.  These will be considered “the plan.”
2-The PEAD form (Coronavirus Property Entry Advisory and Declaration) will be updated and split into 2 separate forms – one for the occupants to sign and one for those who will enter the property.  This will be considered “the rules.”
3-Listing agents must post a blank copy of the PEAD form (rules) and a pictogram (above) at the entrance of the property.
The pictogram is also being revised.  Gloves and booties will no longer be required to be worn by everyone entering the property, but they must sanitize hands prior to entering or wash hands immediately after entering, and the seller must provide either the sanitizer or a wash station in the home for this purpose.  The seller (or listing agent) must also provide masks and sanitizing wipes (for cleaning after the showing).  Although gloves and booties are not required, masks still are, and while the hope is that people have their own masks, they may not enter listing properties if they don’t have one.
With the new regulations by the state, agents are also responsible for “thorough cleaning and disinfecting between showings.”  C.A.R. was able to have language removed from the law that also would have required period deep cleaning of the listing properties.  It is unclear who is required to do the cleaning, but it is most likely the showing agent(s) as the occupants of the home and the listing agent(s) is/are not present during and immediately after showings.
If you are conducting “open houses by appointment” agents will need to adjust the appointment times to allow for the thorough cleaning and disinfection in between each showing.
C.A.R. hopes to send out the revised Best Practices, PEAD forms and pictogram to all members later this week.