how do real estate professionals sell the sarasota … market, sarasota has always emerged as a...

NOVEMBER 2008

How do real estate professionalssell the Sarasota lifestyle?

See Page 6

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Sarasota Realtor®

Volume 5, Issue 11 NOVEMBER 2008

Sarasota Association of Realtors®, Inc.

3590 South Tuttle Avenue Sarasota, Florida 34239 Phone: 941/923-2315 FAX: 941/923-0191

www.sarasotarealtors.com

2008 OfficersPresident

Helen Sosso Prudential Palms Realty

President-Elect William Geller

Suncoast International RealtySecretary

Michael Bruno Coldwell Banker Residential Real Estate, Inc.

Treasurer Erick Shumway

RE/MAX Gulfstream RealtyImmediate Past President

Joe Hembree Hembree and Associates, Inc.

Chief Executive Officer Kathy Roberts

Mission StatementThe mission of the Sarasota Association of Realtors®

is to advance members’ professionalism through delivery of education and resources while upholding the Realtors® Code of Ethics. We are committed to be the leading advocate of real estate in the communities we serve by protecting private property rights and expanding relationships with individuals and organizations both locally and worldwide. Sarasota Realtor® is published monthly by the Sarasota Association of Realtors® Inc.

Editorial Staff

Director of CommunicationsRay Porter

Director of Member ServicesDan Andrews

Director of MLS Information SystemsJesse Sunday

Director of Professional DevelopmentCatherine McCaskill

Governmental Affairs DirectorMarc Mansfield

ProductionCoastal Printing, Inc.

Sarasota Realtor® Advertising: For information on advertising rates and deadlines, contact Ray Porter at 941/328-1168 or [email protected].

Subscriptions: The annual dues of every member of the Sarasota Association of Realtors®, Inc., includes a one-year subscription to Sarasota Realtor® magazine. A yearly subscription for Sarasota Realtor® magazine is available to non-members for $25, plus Florida sales tax.

Editorial ideas and manuscripts are welcomed. Byline articles and columns express the opinions of the writers and do not necessarily reflect the policies or sentiments of the Sarasota Association of Realtors®, Inc. All submitted copy is subject to editing.

2008 Copyright© by the Sarasota Association of Realtors®, Inc. All rights reserved. Reproduction in whole or in part without written permission is prohibited.

6 Living in ParadiseDespite all the doom and gloom, Sarasota remains a beautiful,

vibrant and energized community, attracting many new residents.

10 Housing RecoveryMarc Mansfield, Governmental Affairs Director, explains the federal

Housing Recovery Act and its potential impacts on your business.

17 Pending Sales UpSales statistics for September saw a big improvement over September

2007, and also a healthy “pending sales” number.

26 Belt TighteningBrokers facing the new economic realties are finding new ways to

reduce training costs.

31 WCR InstallationThis year’s WCR Installation of Officers and Directors will be

held on Dec. 4 at Marina Jacks.

In every issue10- Governmental Affairs

14- Ethics in Action

16- Sales & Listing Statistics

18- CID Update

20- Education Programs

26- Broker Corner

28- WCR News

30- Membership News

31- International Real Estate

32- Calendar of Events

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4 NOVEMBER 2008 Sarasota Realtor Magazine www.sarasotarealtors.com

December 2008 Dues Billing Notice

Community Outreach SOS program gives backArea veterans to receive gifts, program support, Thanksgiving dinner

The Sarasota Association of Realtors Community Outreach Committee has been busy during the summer and fall months determining how to disperse almost $10,000 in donations to local veterans as part of the Surge of Support (SOS) program.

The final decisions will be put into action this holiday season, and include:

- Sponsorship of the Thanksgiving Day dinner at the James A. Haley VA Hospital in Tampa.

- Major sponsorship for the Adaptive Golf Association Veterans program, based here in Sarasota.

- Monetary gifts totalling $1,500 to purchase a sofa and barbecue for the Haley House facility for visiting relatives of veterans staying at the VA Hospital in Tampa.

- A Wii video game system with the Sports software package for the VA Hospital’s recreational/rehabilitation program.

- A big screen HDTV for use in conjunction witb the Wii system.

- More than 400 specially customized Tervis tumblers, purchased from the local Tervis Tumbler company as gifts for more than 400 disabled veterans who will spend their holidays at the VA hospital.

Funding for these projects was made possible through the generosity of SAR members as part of the SOS program which was launched in late June and has raised thousands of dollars to demonstrate the local real estate community’s support and commitment for our veterans.

IMPORTANT DUES INFORMATION – PLEASE READ CAREFULLY

When and Where are dues invoices sent?Individual dues invoices will be available @ http://www.

sarasotarealtors.com (under MY SAR ACCOUNT at top of the page) on November 1st, where they can be viewed, printed, and paid. In addition, an email will be sent to all members notifying them when the invoices have been produced and are available for payment. Invoices are being sent earlier (with the same due date) to allow more time for our members to pay.

What will be included on this dues billing?- Annual dues: Local, State, National, CID (if applicable),

Suncoast CIX (if applicable), and voluntary RPAC.For the Who, What, When, Where, Why’s regarding

electronic online dues payments, please visit the SAR website at www.sarasotarealtors.com and click on the MEMBERS tab near the top of the page, FAQ’s, Dues and Accounts.

Due Dates, Late Fees, and Suspension of Services- Due: December 15, 2008; Past Due: January 15, 2009,

5:01 p.m. - $50 late fee assessment on open balances a/o January 15,

2009, 5:01 p.m. - Members with open balances a/o 5:01 p.m. on January

15, 2009 will be subject to suspension of all Realtor® services, including MFRMLS and Supra.

Payment Methods: ELECTRONIC PAYMENTS ONLY!!!

Two payment options: 1. Deduct directly from your checking account via: - Debit card (MC,V) – the easiest way to have the

payment deducted from your checking account. - Electronic check – use same information as on your

check.2. Credit card (MasterCard, Visa, or American

Express).Instructions for all paymentsPay online through our safe, always-available internet site- go to www.sarasotarealtors.com- click on MY SAR ACCOUNT at top of page- under My Services, click on “Pay/View Bill Online”- online charges will appear on your bank and credit card

statements as “Realtor Association/MLS”ORCome to the SAR offices and use our computer in the

library which is programmed to open directly into the log-in screen and has easy instructions located at the workstation for your use

Once payments are made online, they are updated to your account within 72 hours. We encourage you to go online to check the status of your account.

www.sarasotarealtors.com Sarasota Realtor Magazine NOVEMBER 2008 5

Why? It only requires a few hours driving around our beautiful, vibrant, clean and friendly community to understand why people continue to purchase real estate in Sarasota in good times and bad.

Some buy for investment purposes; some for second vacation homes; and others who recently relocated to the area for jobs, family or education and buy for a place to live. Still others are simply ready to escape the rental scene and start building equity in a home that will provide long-term appreciation.

But the major reasons for purchasing in Sarasota, as opposed to other parts of Florida or the nation, are far more numerous and obvious. The reasons are well known to SAR-member real estate agents, many of whom have lived here many years.

The attractions of the coastline of Sarasota are incredible. The natural beauty of the shoreline; the challenging and picturesque golf courses; the wonderful cultural amenities; the clean air, waterways and neighborhoods – all this and much more make Sarasota a top-notch community.

Even local Realtors® who have lived here for only a short time already know what makes Sarasota special, and they often use these unique attributes to market the community.

Sarasota enjoys a magnetism that brings new residents to the sunshine, the fresh air, the blue skies, the crystal sand beaches, the waters, the restaurants, shops, museums and shows. There is an energetic cultural mix of artists, talented individuals, musicians, performers, writers, and other creative people. They obviously enjoy living here, and when people visit Sarasota on vacation, they often do not want to leave. Many return years later to make their permanent home here.

Sarasota has something few other place in the world offer – a perfect mix of new and old, historic and modern, traditional and cutting edge, relaxed and energized. There’s something for every lifestyle in

Sarasota!The nation seemed to really start taking notice of

Sarasota shortly after the turn of the millennium.

one of its annual Top 100 Cities in which to live in December 2002.

Sarasota-Bradenton area as the only community in Florida worthy of its Five Star Community ranking the same year. For executives at companies looking to move or expand their businesses, Sarasota-Bradenton scored high for its “Quality of Life Quotient,” judging crime levels, housing affordability and availability, education levels, cost of living, employment opportunities, continuing education opportunities and accessibility to air travel. And Sarasota schools also received a BLUE RIBBON, the highest rating of any school system in the state.

only eight cities for the “Best Places to Retire” in their May 10, 2002 issue.

Sarasota made it into the Top 20 on Employment Review’s “Top 20 Best Places to Live and Work” list, published in June 2000, and again in 2001. The editorial staff looks at more than 300 cities comparing population, unemployment rates, cost of living and job opportunities for professionals on the move.

the sixth best medium-sized city in the U.S. for small business, and the eighth best place in the south for entrepreneurs.

Top 100 in the nation as well as naming the Sarasota-Bradenton area as the 21st Best Place to Live in the U.S.

Continued on P. 7, See SARASOTA

tLiving in Paradise Sarasota remains an amazing place to reside

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The national (and now international) wave of economic angst and crisis may sometimes seem

overwhelming, putting many people in a fearful mood. But through all the historic cycles in the real

estate market, Sarasota has always emerged as a market leader during the recovery phase.


652 S. Washington Blvd.Sarasota,Fl 34236

Phone (941) 951-7888Fax (941) 951-7599

Now, during this historic time of economic strife, these same factors are still here in Sarasota.

Nothing has changed for the worse – if anything, the community has become even more attractive due to improvements in the cultural offerings (the recent Ringling Museum renovations, for one example), new, unique golf courses (the opening of The Concession and the Founders Club), ongoing improvements to the local transportation corridors, additional park development and many other private and public projects.

Once the current cycle gives way to a new upward wave of confidence and resurgence, Sarasota will once more ride the next crest of prosperity and attract a whole new group of people discovering our local paradise.

So, despite the sometimes gloomy economic headlines, local Realtors® can take pride in the fact that they are selling the American dream in a tropical paradise – a place that is now on the map, both nationally and internationally, and will continue to attract newcomers and local buyers for the long term.

SARASOTAFrom Page 6

NAR urges Congress to pass stimulus packageBy Jerry GiovanielloNAR Senior Vice-President, Government Affairs

As we race toward the finish line of the 2008 election, NAR is continuing to press Congress to act on a new stimulus package to help stabilize the housing market and give a boost to the sagging economy.

NAR has presented a four point stimulus plan to Congress for consideration either after the election or in the early days of the new 111th Congress. The current economic crisis is, at its core, the result of problems in the nation’s housing and mortgage markets. This circumstance, along with the fact that housing has always lifted our economy out of downturns, makes it imperative that efforts be taken immediately to foster a housing recovery, so that a recovery of the overall economy can occur.

NAR’s plan includes features such as consumer-driven provisions that eliminate repayment of the first-time homebuyer tax credit and expands it to all homebuyers, makes higher mortgage loan limits permanent, focuses the economic stabilization efforts once again on the housing and mortgage markets as

opposed to providing banks with capital with no strings attached and prohibits banks from entering into real estate.

NAR strongly believes that inclusion of these priorities in a stimulus package is imperative to move our nation out of this economic crisis:

1. Remove the requirement in the current law that first-time homebuyers repay the $7,500 tax credit, and expand the tax credit to apply not only to first-time buyers but also to all buyers of a primary residence. This will help address inventory issues in many markets.

2. Revise the FHA, Fannie Mae and Freddie Mac loan limit increases to reflect the higher temporary level enacted in February. Although subsequent legislation made loan limit increases permanent, the permanent loan limits were reduced from the February levels. This has broad implication for homebuyers in high cost areas.

3. Urge the government to use a portion of the allotted $700 billion that was provided to purchase mortgage-backed securities from banks to provide price stabilization for housing. The Treasury department should be required to use the newly enacted Troubled Assets Relief Program to push banks to:

Street, making credit more available to consumers and small businesses;

real estate owned (REOs) properties.4. Make permanent the prohibition

against banks entering real estate brokerage and management, further protecting consumers and the economy.

NAR has presented this plan to Congress and will continue to strongly pursue a special session of Congress to enact this vital housing stimulus legislation package after the national election. Housing has always help lift the economy out of downturns. It is imperative to get the housing market moving forward as quickly as possible. Congress must take immediate and specific actions to boost the confidence of potential homebuyers in the housing market and make it easier for qualified buyers to get safe and affordable mortgage loans.

If you are attending the 2008 REALTORS® Conference & Expo please show your support for the NAR Plan by sending a letter to your Member of Congress and “Signing the House” on the floor of the Expo.

Register now for NAR Expo, Nov. 7-10The NAR Annual Expo and Conference is set for Nov.

7-10 at the Orange County Convention Center in Orlando, Florida. The Expo portion starts on Nov. 7 at 4 p.m. and is FREE to Florida Realtors. Here are 605 reasons to attend:

No. 1: It’s free to Florida RealtorsReason No. 2: You could win a 2009 Cadillac CTSReason No. 3: You could win $1,000 Reason No. 4: You could hobnob with thousands of Realtors

under one roofReason No. 5 - 605: You could check out 600 exhibitorsThe 2008 REALTORS® Conference & Expo is a must

attend to succeed in any market:, and includes:

other real estate event!

IT professionals, International specialists, property managers, and more--200 programs in all!

markets

that get the listing

relationships with developers in the International 2nd Home & Resort Pavilion

marketing innovators, sports, loyalty and service experts and creativity coaches from this year’s Entrepreneurial Excellence Series line up of seven extraordinary sessions


Volunteer for 2009 Committees/Task Forces Now is the time to consider joining the leadership team by taking part in an Association committee or task force in 2009. You’ll make new contacts, enhance your professional abilities and have the opportunity to make a difference from behind the scenes. Additional task forces will become available once the Strategic Plan is completed. Watch for updates and other opportunities. Affiliate: Organize and support activities and events and provide input. An Affiliate or Auxiliary membership is required. (Meets as needed) Community Outreach: Evaluate, recommend and organize projects that benefit the community, enhance the image of Realtors, and provide opportunities for networking and camaraderie. (Monthly) Public Policy: Involve members in the political process through education, information, and grassroots involvement. (Meets as needed) Green Realtors® Alliance of Sarasota: Develop education programs and resources to further the preservation of our environment and natural resources as it pertains to real estate. (Monthly) Grievance Committee: Review ethics complaints and arbitration requests to make preliminary evaluation to determine if a formal Professional Standards Hearing is warranted. Annual training is required in December to serve on this committee. (Monthly) International Council Steering Committee: Develop education programs, networking events and resources to prepare Realtors® for specific cultural and economic issues that are an integral part of working with the many buyers and sellers of foreign origin. (Monthly) Member Benefits: Review and analyze proposed programs, products, and services to evaluate the potential benefits to membership and the Association. (Meets as needed) Nominating Committee: Offer recommendations for SAR leadership positions (officers, directors, etc.) and select annual award recipients. (Meets as needed) Power Marketing: Plan and conduct weekly MLS Power Marketing sessions. (Meets as needed) Professional Development: Provide input regarding education, sales training, leadership development, new member orientation, and risk management. (Quarterly) Professional Standards: Enforce the Code of Ethics by conducting hearings on charges of unethical conduct and arbitrate contractual disputes, including entitlement to compensation in cooperative transactions. Annual training is required in December and service on the Grievance Committee is a prerequisite. (Meets as needed) Public Information: Assures that SAR is the single source of accurate, reliable information on our industry in the Sarasota market. (Monthly) Realtor/Attorney Joint Committee: Provide monthly Q & A for SAR Magazine. (Plan periodic legal programs for members). Duty to stay current with real estate laws and FREC changes. (Monthly) Realtor Day: Plan and conduct annual golf and bowling tournaments for broad appeal to the membership as a fundraising event. (Meets as needed) RPAC (Realtor Political Action Committee): Conduct awareness campaigns, programs and activities to raise funds for the support of candidates and real estate issues. (Meets as needed) Sarasota Young Realtors®: Provide forum for young Realtors® to come together for meet and greets, power pitch sessions, and discussion and education on the state of the market, upcoming opportunities, and strategies for success. (Monthly) Scholarship: Solicit scholarship applications, conduct applicant interviews and select recipients. (Meets as needed) During the year, special task forces will be appointed to accomplish various projects. If you are interested, just indicate “various task forces” on the online form.

To volunteer, visit our web site at www.sarasotarealtors.com/committees


Housing and Economic Recovery Act provisions explained

hH.R. 3221, the Housing and Economic Recovery Act of 2008 was signed by the President on July 30, 2008. While the Homebuyer Tax Credit portion of the bill received the most publicity other less known provisions of the bill are also important to Realtors®. They are explained below:

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Including a strong independent regulator and permanent conforming loan limits up to the greater of $417,000 or 115 percent of the local area median home price capped at $625,000. The effective date for reforms is immediate but loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).

Including permanent FHA loan limits at the greater of $271,050 or 115 percent of local area median home price, capped at $625,000; streamlined processing for FHA condos; reforms to the reverse mortgage program and reforms to the FHA manufactured housing program. The down payment requirement on FHA loans will go up to 3.5 percent (from 3 percent). The effective date for reforms is immediate, but loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).

A 10 percent tax credit of up to $7,500 is available for any qualified purchase between April 9, 2008 and June 30, 2009. A qualified purchaser is defined as first-time homebuyers who have not had an ownership interest in a principal residence in the previous three years. The credit is repayable over 15 years.

- Provides a one-year benefit that will be available to all homeowners. Under current law, property taxes are deductible only if an individual itemizes his/her deductions on Schedule A of their tax return. The new provision will permit a deduction of up to $500 ($1,000 on a joint return) for all individuals who utilize the standard deduction and do not itemize. Instructions

will be provided on the 2008 tax return when it is distributed at year-end.

Development of a refinance program for buyers with problematic subprime loans. Lenders would write down qualified mortgages to 85% of the current appraised value and qualified borrowers would get a new FHA 30 year fixed mortgage at 90% of appraised value. Borrowers would have to share 50% of all future appreciation with FHA. The loan limit for this program is $550,440 nationwide. Program became effective on October 1, 2008.

programs – Codifies existing FHA proposal to prohibit the use of downpayment assistance programs funded by those who have a financial interest in the sale. It does not prohibit other assistance programs provided by nonprofits funded by other sources, churches, employers or family members. Prohibition became effective October 1, 2008.

Temporarily increases the VA home loan guarantee loan limits to the same level as the Economic Stimulus limits through December 31, 2008

Puts a moratorium on FHA using risk-based pricing for one year. This provision is effective from October 1, 2008 through September 30, 2009.

Includes language proposed by the Treasury Department to authorize Treasury to make loans to and buy stock from GSE’s to make sure that Freddie Mac and Fannie Mae could not fail.

Authorizes $10 billion in mortgage revenue bonds for refinancing subprime mortgages.

By Marc Mansfield, Governmental Affairs Director


Develops a Trust Fund funded by a percentage of profits from the GSE’s. In its first year, the Trust Fund would cover costs of any defaulted loans in FHA foreclosure program. In future years, the Trust Fund would be used for the development of affordable housing.

Provides $4 billion in neighborhood revitalization funds for communities to purchase foreclosed homes.

Modernize this program to make it more efficient.Strengthens

the existing state-run nationwide mortgage originator licensing and registration system (and requires a parallel HUD system for states that fail to participate). Federal bank regulators will establish a parallel registration system for FDIC insured banks. The purpose is to prevent fraud and require minimum licensing and education requirements. The bill exempts those who only perform real estate brokerage activities and are licensed or registered by a state, unless they are compensated by a lender, mortgage broker or other

loan originator.

This real estate related provision affects only a limited set of circumstances. This modifies the application of the $250,000/$500,000 exclusion but ONLY in situations in which an individual who owns a second home converts the second home to use it as his/her principal residence. Beginning in 2009, the exclusion as it applies to a second home (or rental property) that is converted to a principal residence will be allocated on the basis of the length of time the second home was a principal residence. When the second home is sold any gain attributable to use as a second home (or rental property) will be taxed at capital gains rate. The new rule is a “use test.” It requires the owner of a second home that becomes a principal residence to compute the exclusion amount of any taxable gain based on the use of the property. Gains from investment/rental use will be taxed as investment gains at capital gains rates, just as gains from a second home or investment property would be taxed if the owner had never lived in the residence. Gains from a principal residence use will be taxed under principal residence rules and depending on the amount of gain, be eligible for part or all of the $250,000/$500,000 exclusion.


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sChanges in Foreign National Lending:How will it impact your future business?Changes in lending availability for foreign nationals here in the U.S. have been cathartic. The general trend is back towards a more centralized loan origination and delivery system.

What this means is that fewer options will remain for our foreign national clients. So we can all be better prepared to meet the challenging environment of our real estate industry, let’s examine some of those changes.

We will start with Changes in Secondary Market, characterized by Wall Street. Then we’ll examine how changes at the Wall Street level have trickled down into the Institutional Levels. From there, we’ll talk about how the institutions themselves have made fundamental changes in their Loan Products. We shall review four key aspects of foreign national lending programs: Down Payments, Rates, Lender Fees and how all of these can impact Time Frames to Close.

Changes In Secondary Market have been well publicized in many public forums. Wall Street has lost the ability to take packages of loans from many institutional lenders (bundle or re-package them into a pool and sell the pool off to an investor). We refer to these types of pools of mortgages as collateralized debt obligation (C.D.O.) or collateralized mortgage obligation (C.M.O.).

The plight of Bear Stearns is a key example. With the market for pooled mortgage sales shutdown on Wall Street - the only other source of secondary liquidity for primary institutional lenders (the wholesalers to whom mortgage brokers turn for clients) are the GSE’s - Fannie Mae and Freddie Mac.

However, loans to Foreign Nationals by originators and banks may no longer be eligible for sale/purchase by the GSE’s. So where does that leave the foreign national purchaser? Loans to Foreign Nationals will come from a reduced number of specialized Portfolio or Pocket Institutional Lenders for the near future.

Changes at the Institutional Level will manifest themselves in the reduced number of lenders mentioned above. Institutional Fallout from the lending industry has also been well publicized. Wachovia, Sun Trust, Chase, Bank Atlantic and Bank United (as of Sept. 5, 2008), all former industry leaders in products for foreign nationals. All of these institutions are now out of the lending business for foreign nationals.

Only a few specialized institutions will accept the risk associated with lending to a foreign national. These are companies who will originate and hold and service that loan over the term of the loan. Because the institution holds the loan in its own ‘pocket’ or ‘portfolio’ they garner the term “pocket lender.”

The general trend is back towards a more centralized loan origination and delivery system.

Portfolio – Pocket Lenders is the way it’ll be for the near future - at least insofar as the secondary market remains a broken mechanism. Since those options will center on what we call ‘pocket’ or portfolio lenders, who originate and hold those loans within their own portfolios, only a few institutions remain for the Canadian borrower. TD Commerce Bank, RBC and Harris Bank (a unit of Bank of Montreal) are three examples. TD Commerce Bank is new to Canadian

Lending in Florida, so their portfolio is being grown; however, the converse is the case at RBC.

The RBC portfolio experienced its greatest growth during the ‘boom’ years of 2004-2006. Consequently, loans originated during that time frame are over valued relative to the new real estate values in Florida. As a result their portfolio was being contracted and constrained by RBC’s management in the face of increasing reserves for loan losses. Remember these firms no longer have access to the secondary market for the repurchase of these loans in the form of CDO/CMO issuances. Consequently they can and have, adjusted the amount of risk they’re prepared to assume.

Contraction in lending risk has been seen in the down payments, which is one of the most ‘up-front’ methods of reducing loan exposure. Down payments

By Jack Sandleman, Fidelity Mortgage

So, rates are going up and fees are going up as is the amount of time that the down payments must be

here seasoning in a Florida banking institution.


have been increased to 30 percent in most cases and can be as high as 45 percent conditioned on property use and whether it’s located in a declining market county (includes all counties in southern half of Florida). And now, a word about down payment seasoning.

The down payments (in toto) must be brought to the U.S. and left in a domestic bank for 30 days, where borrowing is to be used. This rule has become more stringently enforced than ever. The sourcing and seasoning of down payment monies is primarily influenced by Anti-Money Laundering regulations and the Patriot Act legislation. This means that a Canadian or other foreign national looking to buy U.S. real estate must move their down payment funds plus closing costs to the U.S. a full 30+ days before even going under contract. A typical contract period is 30 days; thus, foreign nationals would potentially be looking at a time to purchase period of 60 or more days.

Rates, however are not typically locked for 60-day periods. But one of the other changes in loan programs has been rate adjustments. As risk increases, so do rates; generally between .75 percent and 1.25 percent (conditionally). It is also a given economic theorem that rates also will experience further increases as the number of available loan products decreases. Basic economics - the fewer sellers in a given market for a good or service, they can charge whatever the market will bear (or whatever the public will pay). Moreover the whole monthly cost of the debt service will change for the foreign national borrower. Especially since escrow accounts are now mandatory for taxes and/or insurance, mandated in some rule changes adopted by the Treasury Department under the HOEPA statutes (July 15, 2008). But depending on the lenders appetite for the risk, a few buy-out programs remain, however at no small cost to the borrower.

Changes in Loan Programs have very prominently manifested themselves in lender fees charged to foreign

national borrowers. Lender Fees have increased relative to the markets contraction. Its analogous to the Airline Syndrome: where the pressing need from the lenders (or airlines) perspective is to raise revenues as much as possible. The need for additional income is especially pressing for the purposes of either increasing reserves for loan losses, or raising capital such as through a stock buy-back.

Here’s an example of the lenders fees charged to a recent client from Canada. A 7/1 LIBOR ARM (5/2/5) 30 year term, 3 year soft pre-pay. The rate was 7.375 percent. The Lender Fee was 1.25 percent of the loan amount, plus an additional $700 in lender under-writing fees. Now some of my Realtor partners have asked me, “Why can’t I just steer my purchaser into a portfolio lender directly?” However be warned, portfolio lenders are charging 1 to 2 points as origination fee or in total fees to recoup these revenues for reasons similar to those stated previously.

So, rates are going up and fees are going up as is the amount of time that the down payments must be here seasoning in a Florida banking institution. All of this directly impacts the time frames to close a real estate purchase for a foreign national where financing is to be involved. Underwriting of borrower income and assets is more heavily scrutinized than ever! Sourcing and seasoning adds 30+ days to the loan under writing period unless you and your client are prepared for this from the beginning.

Foreign National Lending is now - more than ever before - a ‘niche’ specialty. In order to make the process of foreign national client intake as smooth as possible, know who your foreign national lending specialist is and involve them as early in process as possible.

Jack Sandleman is a Loan Specialist with Fidelity Mortgage and member of the SAR Affiliate Council. His phone number is 941-388-2121.


rRealtor® placed personal interests ahead of his client’s interests

Dr. Z, a recent transferee to the town, entered into a buyer representation agreement with XYZ through Realtor® B.

Dr. Z explained he had specific needs, foremost of which was any home he purchased be convenient for and readily accessible by Dr. Z’s spouse who was physically challenged. “Part of my wife’s physical conditioning program is swimming,” said Dr. Z, “so in addition to everything else, I am looking for a home with a pool or room to build a pool.”

Realtor® B knew there were a number of homes for sale meeting most of Dr. Z’s general specifications, several of which were listed with XYZ.

Over the next few days, Realtor® B showed Dr. Z several properties in the Blackacre subdivision, all of which were listed with XYZ, including one with an outdoor swimming pool.

Not included among the properties shown to Dr. Z were several similar properties in Blackacre listed with other firms, including one with an indoor pool.

After considering the properties shown to him by Realtor® B, Dr. Z made an offer on the home with the outdoor pool. His offer was accepted and the transaction closed shortly thereafter.

Several months later, Realtor® B received notice of an ethics complaint filed against him by Dr. Z. Dr. Z had learned about the home with the indoor pool from a colleague at the hospital who lived on the same block.

The complaint alleged that Realtor® B had put his interests, and those of his firm, ahead of Dr. Z’s by promoting XYZ’s listings exclusively and by not telling Dr. Z about a similarly-priced property with an indoor pool, which suited his family’s needs better than the property he had purchased.

The complaint went on to indicate that Realtor® B had received a bonus for selling one of XYZ’s listings and that Dr. Z suspected that Realtor® B’s failure to tell him about the home with the indoor pool was

motivated by the opportunity to receive a bonus.At the hearing, Realtor® B defended his actions

stating that properties rarely meet all of potential purchasers desires; that he had made Dr. Z aware of several properties that met most of his requirements, including one with an outdoor pool; and that Dr. Z must have been satisfied with Realtor® B’s service since he had purchased a home.

Upon questioning by Dr. Z’s attorney, Realtor® B acknowledged that he knew about but had not shown the house with the indoor pool to Dr. Z. He conceded that a pool that could be used year round was better suited to the family’s needs than one that could be used only four months each year.

He also admitted his failure to tell Dr. Z about the house with the indoor pool had at least in part been motivated by the bonus offered by his firm. “But,” he argued, “aside from the indoor pool, that house was no different than the one Dr. Z bought.”

The Hearing Panel concluded that Realtor® B had been fully aware that one of Dr. Z’s prime concerns was his wife’s ongoing physical conditioning needs and Realtor® B’s decision to show Dr. Z only properties listed with XYZ and to not tell him about the home with the indoor pool had been motivated by the possibility of earning an in-house bonus.

The Hearing Panel determined that Realtor® B had placed his interests ahead of those of his client and had violated Article 1.

Case #1-26: Subordination of Client’s Interests to

Realtor® B was a sales associate with XYZ, Realtors®. To promote XYZ’s in-house listings, the

firm’s principals offered $1,000 bonuses to the company’s sales associates at time of closing on

each of XYZ’s listings they sold.

Eth

ics

in A

ctio

n

The Hearing Panel determined that Realtor® B had placed his interests ahead of those of his client and had violated Article 1.


LUNCHEON MEETINGS 12:00 pm – 1:30 pmLocation: SAR Auditorium

Friday, Nov. 14 - Fraud in Real EstateDecember - NO MEETING

SOCIAL EVENTS – 5:30 pmWednesday, Nov. 19- Evie’s TavernWednesday, Dec. 17 - Holiday Party

All social events are held at Evie’s Tavern, 1989 Ringling Blvd., Sarasota, and are open to everyone, of all ages. No registration is required.

For future Social Event locations or for more information, please watch for emails, check the SR Magazine, or contact Peggy Beiling at the Association at [email protected].

Sarasota Young Realtors® 2008 Schedule of Events

Realtor.Com® launches new web siteA redesigned REALTOR.com, the

nation’s No. 1 real estate Web site, was recently launched to deliver even more user friendly features to consumers and more value and power to Realtors® marketing their brand and client properties.

Visitor activity continues to increase within REALTOR.com, the official property Web site of the National Association of Realtors®, which is operated by Move Inc. (NASDAQ: MOVE), the leader in online real estate.

“Realtors® pride themselves in being industry innovators, and the all-new REALTOR.com site reflects how we add value to the real estate transaction. I’m sure our members will be very happy with the upgrades because the new features give us more of what we want, especially more traffic to our listings, and all of it is more attractively displayed,” said NAR President Dick Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif. “Consumers, too, will be pleased with the redesign. The site is more user friendly, contains more listing data including neighborhood and school reports, and shows home value comparisons – and a new search function will make it easier to find what they want.”

Move’s research during the Beta phase determined that, more than anything, consumers want “more and better quality photos.” To help real estate professionals enhance their marketing efforts, the site now includes more, higher quality photos that are 140 percent larger than before; a dynamic photo carousel on the

homepage; and photo galleries, virtual tours, and videos that are easier to find and provide an “insider’s view” of properties.

“REALTOR.com is the nation’s most popular real estate Web site, and we’ve watched with excitement as consumers respond favorably to the redesigned Web site in this challenging market,” said REALTOR.com President, Errol Samuelson. “Today, it’s more important than ever that REALTOR.com offer helpful resources to buyers and sellers and a more effective marketing platform for Realtors® looking for efficient and relevant ways to market their brands and client properties.”

Data about visitor searches on the new site already indicate that potential home buyers are now five times more likely to go from the homepage to a listing detail page as compared to the classic site. They’re also viewing 40 percent more properties and clicking through 12 percent more often to view details on properties of interest. In addition, visitors are 37 percent more likely to e-mail an agent and 10 percent more likely to click through to their Web site.

Samuelson pointed out that the number of potential home buyers registering for personal alerts rose during the Beta test phase, resulting in dramatic click-through rates and more requests for information about properties. User registrations grew by 9 percent in the second quarter of this year compared to the first quarter on the classic site, and the number of consumers electing to receive email alerts doubled. Over

3.3 million alerts have been delivered since the Beta site was launched in May 2008. This has resulted in an increase in the direct click-throughs to property listings. Compared to the classic version of the Web site, 45 percent more visitors downloaded informational brochures on properties of interest and they forwarded listings to friends 10 percent more often.

Throughout the site, newly integrated and intuitive search features have reduced the number of clicks consumers take as they search, while improved navigation features swiftly power them through REALTOR.com’s 4 million-plus listings. Listings are now time-stamped for freshness, while greatly enhanced personalization options offer convenient and timely alerts so consumers remain current as new information or listings become available.

“The new REALTOR.com sets the online standard in real estate listings for consumers, and this is also great news for Realtors®,” said Samuelson. “By creating a more inviting, easy-to-navigate and personalized search experience, REALTOR.com encourages potential home buyers to be more involved in real estate, and consumers benefit from interactive new features and tools that lead to local real estate professionals − making the new REALTOR.com an even more powerful advertising investment for Realtors®.”

To help real estate professionals enhance their marketing efforts, all Realtors® now receive greater visibility for their free listings. on local demographics, schools, and amenities.


Sales DataSeptember 2008

Class Sales Average Sale Price Median Sale Price Sold Volume

Residential 360 $332,883 $201,250 $119,838,033Condo 78 $391,200 $190,000 $30,513,623

September 2007Class Sales Average Sale Price Median Sale Price Sold Volume


Listings DataSeptember 2008

Class New Average List Price Median List Price Volume Listed


September 2007Class New Average List Price Median List Price Volume Listed


Residential Sales Summary

2 – 3 4+ CONDO TOTAL PRICE BDRMS BDRMS BDRMS CO-OP UNITS

$99,999 & UNDER 27 24 2 12 65

$100,000199,999 31 85 2 27 145

$200,000299,999 14 31 17 7 69

$300,000399,999 9 21 11 8 49

$400,000499,999 3 14 11 3 31

$500,000749,999 1 8 16 9 34

$750,000999,999 0 1 12 4 17

$1,000,0001,499,999 1 4 3 5 13

$1,500,0001,999,999 0 0 5 1 6

$2,000,0002,499,999 0 0 0 0 0

$2,500,0002,999,999 0 1 3 0 4

$3,000,0003,999,999 0 1 1 2 4

$4,000,0004,999,999 0 0 1 0 1

$5,000,0009,999,999 0 0 0 0 0

$10,000,000 & UP 0 0 0 0 0

**TOTALS 86 190 84 78 438

TOTAL DOLLAR VOLUME TOTAL DOLLAR VOLUME TOTAL HOME SALES SINGLE FAMILY CONDOMINIUM DOLLAR VALUE $119,838,033 $30,513,623 $150,351,656

September 1 to September 30, 2008SALES

SALES as ofSept. 30, 2008

These statistics were gathered from the Sarasota Association of Realtors MLS on Oct. 10, 2008. Note: Statistics are for SAR members of the SAR MLSSM system. Figures will include some listings in Manatee,

Englewood, Venice and other areas.

Sales and Listings for September 2008

Residential Sales Summary Year to Date

2 – 3 4+ CONDO TOTAL PRICE BDRMS BDRMS BDRMS CO-OP UNITS

$99,999 & UNDER 158 93 12 62 325

$100,000199,999 352 575 64 212 1,203

$200,000299,999 251 477 97 133 958

$300,000399,999 105 292 143 120 660

$400,000499,999 40 142 112 102 396

$500,000749,999 27 164 139 157 487

$750,000999,999 4 69 63 82 218

$1,000,0001,499,999 5 47 50 40 142

$1,500,0001,999,999 1 25 36 28 90

$2,000,0002,499,999 0 3 7 12 22

$2,500,0002,999,999 0 8 19 11 38

$3,000,0003,999,999 0 3 15 9 27

$4,000,0004,999,999 0 3 5 0 8

$5,000,0009,999,999 0 0 9 1 10

$10,000,000 & UP 0 0 0 0 0

**TOTALS 943 1,901 771 969 4,584

TOTAL DOLLAR VOLUME TOTAL DOLLAR VOLUME TOTAL HOME SALES SINGLE FAMILY CONDOMINIUM DOLLAR VALUE $1,368,379,684 $470,235,839 $1,838,615,523

Jan. 1 to Sept. 30, 2008SALES

SALES as ofSept. 30, 2008

700-

650-

600-

550-

500-

450-

400-

350-

300-

250-

200-

150-

100-

50-

0- Sept. ‘06 Sept. ‘07 Sept. ‘08 Sept. ‘06 Sept. ‘07 Sept. ‘08

September 2008Average Sale Price Units Sold Days On Market

RESIDENTIAL DAYS ON MARKET

CONDOMINIUMAVE. SALE PRICE UNITS SOLD

$429,900

316

$413,752

234

164

360

160

$391,200

198

78

$501,042

185

134

$587,998

225

104126

$332,883


dSale Price vs. List Price Rates

Single Family 2007 2008

January 90.9% 92.0%February 89.9% 92.0%March 93.1% 93.0%April 93.2% 93.0%May 92.3% 92.0%June 92.2% 93.0%July 93.3% 93.0%August 93.4% 92.0%September 92.4% 93.1%October 93.2% November 90.7% December 93.0%

Condominium 2007 2008

January 92.5% 91.0%February 93.8% 91.0%March 94.2% 91.0%April 97.1% 91.0%May 92.2% 92.0%June 94.4% 92.0%July 93.1% 93.0%August 91.5% 90.0%September 91.3% 90.0%October 92.4% November 89.5% December 91.0%

Local real estate market enjoys September rise in pending sales

Pending sales rose in September 2008 and overall sales stood almost identical to August 2008 in the Sarasota MLSSM. In fact, overall sales in September 2008 were 29 percent higher than overall sales in September 2007 – a statistic that flies in the face of the recent negativity in the media.

Overall sales came in at 438 in September, just under the 440 reported in August, and only slightly lower than the 454 in July. But the sales figure in September 2008 was much higher than the 338 sales reported in September 2007 for single family homes and condos.

The local market faired even better than the overall state of Florida, which saw a 24 percent jump in single family home sales and an 11 percent jump in condo sales over September 2007 numbers.

Single family home sales soared comparing September 2008 to September 2007. There were 360 sales reported this year, compared to only 234 last year, for a jump of almost 54 percent. The number of sales was roughly the same as last month, when 356 single family homes

changed hands. While there were fewer condominium sales reported in September 2008 by SAR members (78 total), the overall numbers were strong.

The September 2008 report also continued to show strength in pending sales, which stood at 584, almost 9 percent higher than last month’s total of 536. Higher pending sales, which are contracts executed by buyers and sellers during the month, forecast a stronger market, as these properties close in the coming months.

The median sales price for single family homes decreased in September, falling to $201,250 from last month’s median of $226,250. The condominium median sales price also dropped to $190,000 from last month’s $295,000, but the August median showed an uncharacteristic spike. For example, in July 2008 the median stood at $252,500. The general trend appears to one of local prices now coming more in line with drops statewide and nationally.

“We are closely watching the local real estate market and monitoring the

With all progress and change comes the usual growing pains, and the new Sarasota MLSSM system has had its share of anomalies and adjustments for our members.

The changes inherent in the new system have resulted in the elimination of most duplicate listings and sales that were caused by members who entered listings in more than one MLS.

Within a short time, we will be able to recreate the historical data, eliminate duplicates, and see a clearer, more accurate comparison of the numbers

from previous years. In the meantime, the association is using this opportunity to study our statistical presentation, in the hope of amending the types of reports and graphical presentations for our members, hopefully in the next issue.

For the time being, please understand that the comparative statistics for previous years will not accurately reflect the true trends our market is experiencing, as they are in effect comparing apples to oranges.

New MLS system brings changes to monthly statistical reporting

Conrinued on P. 19, See STATS


2008 CID RemainingPrograms and Events

Tuesday, Nov. 18SAR - Retail Power Marketing Session, Annual CID Election of Board Officers and DirectorsSponsor: EverBank

Tuesday, Dec. 2CID Annual Breakfast - (No regular monthly meeting)Sponsor: Osprey Management

CID Golf and Dinner at the Ranch

Almost 100 golfers turned out for a beautiful afternoon of friendly competition, fun, and most importantly, fundraising for two very worthy local organizations at the CID 2008 Golf and Dinner at The Ranch event held on Oct. 9 at The Legacy Golf Club in Lakewood Ranch.

More than $12,000 net was raised after all expenses were paid, and the two organizations - Construction Technology Careers, and JOY (Joining Our Youth) - received checks from the CID in support of their worthwhile endeavors.

CID thanks our major event sponsors:Verizon (Platinum); Abbey

Management LLC (Gold); Lakewood Ranch Commercial Realty (Gold); Hembree & Associates (Bronze); and Mapp Realty (Hole-in-One sponsor).

CID names nominees for 2009 Board, Directors

Co

mm

erci

al In

vest

men

t D

ivis

ion

Carl Wise tees off on the Par 3 fourth hole. MORE PHOTOS, P. 25

The CID Nominating Committee announced the 2009 nominees for the CID officers and board of directors at the Oct. 21 general membership meeting.

The following nominees will be voted on at the Nov. 18 general membership meeting:

2009 CID President: Jag Grewal2009 CID President-Elect: Lee DeLieto, Jr.2009 CID Vice-President: Rachel Neves2009 CID Treasurer: Linda Emery2009 CID Secretary: Tim Mapp2009 CID Immediate Past President: Dan McLeroyBoard of Directors: Eric Massey (3 years); and

Anthony Homer (3 years).Continuing on the board will be: Michael Blaikie (1

year); Ken Hoskinson (1 year); Ken Hughes (2 years); David Altwies (2 years);

The election of the officers and board will be held at the Nov. 18 meeting, and other nominations should be emailed to [email protected] prior to Friday, Nov. 14 for inclusion on a ballot. If no other nominees come forward, the vote will proceed at the meeting, with the motion to accept the slate as presented by the Nominating Committee.

Additional positions will also be available for CID members to participate on committees.


Listing Summary

Completed Transactions / Comparables

Property Listings by Status

Status Total

Active 1373

Inactive 194

Sale Pending 13

Lease Pending 1

Needs Closing Info 10

Needs Update (30+ days old) 179

Expired 37

Incomplete 709

Total 2563

Property Listings by Type

Property Type Lease Sale Total

Industrial 220 221 441

Office 630 296 926

Shopping Center 36 10 46

Retail-Commercial 294 151 445

Vacant Land 2 214 216

Multi-Family 31 31

Hospitality 15 15

Farm/Ranch 1 1

Special Purpose 7 7

Business Opportunity 15 15

Total 2563

Status Closing Data No Data Total

Sold 1452 77 1529

Leased 469 266 735

Withdrawn 1792

Expired (30+ days ago) 3862

Total 7918

results,” said Helen Sosso, 2008 SAR President. “A 9 percent rise in pending sales is an indicator to us that people are looking to real estate as a safer place for their investments as opposed to stocks or even banks. The decline in the median sales price seems to be attributable to the rise in bank owned and short sale properties, which are selling at terrific values. The Realtors® in Sarasota seem to be having an upswing in the number of showings on property, as well as new customers looking here as the season begins. All in all, we are encouraged by the results.”

Inventory levels in September 2008 dropped for the seventh consecutive month, and are the lowest they have been since late 2005. There were 4,253 single family homes on the

market in September 2008, compared to 6,461 single family homes in August 2008. There were 2,098 condos, compared to 2,407 condos last month. These figures, in combination with sales figures, indicate that the absorption rate for single family homes is now at 12 months, compared to a 43 month figure last year at this time. The condominium absorption rate now stands at 27 months, compared to 53 months last September. Absorption rate is the number of months it would take to deplete the inventory at the current month’s rate of sales.

The Sarasota real estate market offers a tremendous selection of more affordably priced housing for buyers to visit and purchase. In addition, declining inventory levels normally indicate the market is returning to a more historical balance, which eventually leads to normal, long-term price appreciation.

STATSFrom Page 17


Educ

atio

n P

rogr

ams

Mon Tue Wed Thu Fri

3 MLX Intro E & U

4 5 Custom Reports CMA

6 Design Web Pages Tools

7 MLX Intro MLX Advanced

10 Orientation Code of Ethics

11 12 Code of Ethics

13

14

17 International Council Roundtable

18

19

20

21

24 25

26 27 Thanksgiving SAR closed

28 Thanksgiving SAR closed

1 2

3 REO Certification Seminar

4 REO Certification Seminar

5

NOVEMBER 2008

�� Orientation & Code of Ethics, Nov. 10, 9-12 & 1-4; free to members �� Code of Ethics Quadrennial, Nov. 12, 9-12 with Chuck Bonamer; 3 hours CE; $10 members

$20 others �� International Council Roundtable, Nov. 17, 9-11, free to SAR members �� REO Certification Seminar, Dec. 3-4, 9-5 with Cathy McDaniel, $149 (SAR members) $179

(others)

Mid-Florida Regional MLS Training: The classes E & U (Entering & Updating), Tools, Design Web Pages, MLX Intro, MLX Ad-vanced, iMAPP, Custom Reports, CMA, are all Mid Florida Regional MLS training classes offered at no cost to MLS participants. All classes (except E & U) are hands-on in the Tech Center. Please register for all MLS classes at the MFRMLS website: http://mfrmls.com. Click on “Training,” then “quick class registration” and follow prompts. Code of Ethics Reminder: All Realtors (members of the National Association of Realtors) will have

to show proof of completion of the Code of Ethics during the time period 1/1/05 to 12/31/08.

EDUCATION CALENDAR


Code of Ethics Countdown: 60 Days Left!Less than 60 days are left for you to complete the NAR

Code of Ethics refresher requirement! The Code of Ethics is central to the Realtor organization and adherence to the Code of Ethics distinguishes Realtors from mere real estate agents. Because of its importance, the National Association of Realtors (NAR) has mandated, effective January 1, 2005, that every four years all Realtors must complete a 2 1/2 hour renewal course of instruction on the Realtor Code of Ethics, as a condition of membership.

This is a mandatory requirement to remain a member of SAR, FAR and NAR. The course must be completed by December 31, 2008.

Here are four options for completing your Code of Ethics requirement:

1. Code of Ethics training is offered to SAR members free of charge on the second Monday of each month in conjunction with the monthly New Member Orientation from 1:00 p.m. to 4:00 p.m. The instructors are Laura Benson, Kim Gilliland, Rick Hughes and Dave Swenson. These free classes offer no state continuing education credits.

2. November 12 and December 3, Chuck Bonamer will

teach “Rescue” Code of Ethics for 3 hours of CE each. The member fee is $10.

3. Online at www.sarasotarealtors.com. If you would like to earn continuing education credit while taking your Code of Ethics, online is a great way to go. Three- and four-hour CE versions of the course are there for the choosing. You can find the link to these and a variety of other courses on the Education page in the “Overview” drop-down menu section.

4. Online at www.realtor.org. NAR offers the course free of charge on its website. All you need is your NRDS number to log in.

If your last Code of Ethics was prior to January 1, 2005, you will need to schedule your training now. Check your records carefully!

Registration for the SAR courses is handled through the SAR website at www.sarasotarealtors.com. Click on “Education Registration,” enter your user name and password, and then select “Education Services” from the menu of services. Click on the category “Code of Ethics” and select your date. When registering, make sure that you have completed the registration process. You will see a screen come up that says “Transaction Successful.”

‘Red Flags on the Waterfront’ seminar coming Dec. 10Date: Wednesday, Dec.10Time: 9 to 11 a.m.Place: SAR Auditorium

If you sell coastal properties, and if you’re a member of SAR, you almost certainly need to know this information backwards and forwards:

Storm Impact on Real Property

(CCCL)

Insurance – National Flood Insurance

-conforming

Issues

-tors

David Levin is a real estate attorney with the prestigious Icard Merrill law firm. His practice is limited to envi-ronmental and waterfront property law. He has outstanding credentials including an LLM Degree in Ocean and Coastal Law from the University of Miami School of Law.

Register at www.sarastoarealtors.com.


Education Programs

International Council RoundtableDate: November 17Time: 9:00 a.m. to 11:00 a.m.Location: SAR Auditorium

See what’s happening in the international arena in Sarasota, in Florida, and nationally. You will get an update on business development trips overseas in the works, FNAIM and SIMA, and hear about the plans for the 2009 Congress and CIPS programs. You will also have valuable networking time. Come by 8:30 for a continental breakfast and international property pitch.

REO CertificationDates: December 3-4Time: 8:30 a.m. to 5 p.m.Instructor: Cathy McDaniel, RES, RETSLocation: SAR Auditorium

This course fee includes continental breakfast both days, manual, CD with forms and over 50 Bank contacts, Exam, Pin and Certification.

You can start your REO (Real Estate Owned) career today! This step-by-step course will teach you how to complete a BPO (Broker Price Opinion) accurately and organize your asset management efforts. Each REO seller has different pro-cedures and forms. However, they are very similar. Our class offers valuable tools, techniques, and over 50 BPO and REO company resources to work with to get your business moving forward in the REO arena.

Smoothing Out the Rough Edges of Your REO Transac-tionIn this more “advanced” REO section of the class, you will focus on perfecting your transaction and closing process of your REO JHome Sale.An REO/Foreclosure sales contract entails much, much more than simply knowing the FAR technical part of a transaction. This section is designed to give Brokers and Realtors the op-portunity to explore the roles and stages of the REO/Foreclo-sure sales transaction and learn the theory and skills necessary to work with REO, Banks and other lending institutions owning property in the State of Florida.Financing Your REO Transaction

There’s never been a better time to educate yourself about the foreclosures market and line up your resources, specifically your financing options, so that you’re ready to make a move when you find that ideal property. But while it’s one thing to look for property, REO sellers will require you to have your finances well in order before submitting an offer.Laws, Regulations and TechnologyThe Real Estate Commission administers the license law that regulates brokers, salespersons, and community association managers. They adopt rules of practice and procedures. Re-fresh your knowledge of many areas of license law and discuss the difference between rules, procedures and mandatory laws. Your future real estate business could thrive or suffer based on how well you embrace the new world of technology. Using the latest technology tools in your real estate practice will help[ the process become more streamlined and efficient, paperless and wireless, interactive and engaging, and most of all — fun! You will be introduced to new technology that will enhance your business.

Marketing with Microsoft OfficeDate: January 14, 2009Time 8:30 a.m. -5 p.m.Instructor: Pat Zaby, CRSLocation: SAR Auditorium

Run your business with the most powerful and popular soft-ware products in the world. The advantages include seam-less integration, flawless synchronization with all PDAs, and Internet capabilities. This newly designed class will help you unlock the power of Microsoft Office to run your business. Create postcards, printed presentations, and flyers in Word, convincing pre-sentations in PowerPoint, financial information in Excel, and manage your email and contacts through Outlook.The detailed, step-by-step workbook illustrating all of the proce-dures taught in the class, will help you and your team mem-bers shorten your marketing time so you can spend more time with buyers and sellers.

features.

their e-mail correspondence.

sellers to make better decisions.

computer and PDA.

of Word and Excel.


CONGRATULATIONS!Dedication and hard work pay off!! We congratulate our member who recently completed the

® designation and certificate programs:

names.

sellers.

and a pre-listing package. Tuition includes a step-by-step workbook. Pat Zaby is one of the best-known and effective instructors in the real estate application field. Visit his website at www.patzaby.com.

Announcing 2009 GRI Course 1 at SarasotaDates: February 23-25, March 2-4, 2009

Credits: 45 hours salesmen’s post-license credit14 hours continuing education credit

If you wait too long to sign up for GRI Course 1, you might be out of luck as SAR is the only Realtor Association in the vicinity that’s offering any of the courses in 2009. If you are a new salesperson, the GRI Course 1 will offer the 45 hours of Post-License education you need during the first salesper-son license renewal cycle. By taking this course, you can get a leg up on earning your GRI designation while taking care of your 45-hour state licensure requirement. For brokers and salespeople not in their first renewal cycle, the course of-fers 14 hours of continuing education (includes Core Law).

This GRI series is offered by FAR through its Florida Real-tor Institute. All the instructors have been carefully screened for their knowledge of the subjects as well as for their teach-ing techniques—they’re the best real estate teachers in the state. Instructors for the Sarasota course are: Grant Simon (Finance); Steve David (Law and Contacts to Contracts); Dick Fryer (Professional Standards); Ira Glatkin (Tax I); Ric Giumenta (Business Planning and Fair Housing).In a hurry? Don’t wait in line, go online! GRI Course I is now available online through a special Florida Association of Realtors website: www.fargri.com. Online convenience places the course at your fingertips, whenever you want it, and offers the same license renewal menu of credits that the live version does.

CRS 202: Sales Strategies for Residential SpecialistsDates: March 10-11, 2009Times: 8 a.m. to 5 p.m.Instructor: TBALocation: SAR Auditorium

In this market, do you think you could use a course on working with buyers? Top sales associates enjoy a competi-tive advantage because they understand what motivates and influences their customers. Sales Strategies gives students the inside track to win over prospective buyers by teaching them the necessary strategies that make their sales quick and efficient.

William True True Real Estate, Inc.

Linda Barchard Coldwell Banker Residential Real EstateTami Cashi Prudential Palms Realty

Vickie Hinkle Florida New Homes Realty

Cindy Migone Sky Sotheby’s International Realty

Chuck Shah Lakewood Ranch Realtywww.sarasotarealtors.com Sarasota Realtor Magazine NOVEMBER 2008 23

NAR Urges Passage of 4-Point Housing Stimulus Plan and return of Congress for lame-duck session after election

The plan features such consumer-driven provisions as eliminating the repayment of the first-time homebuyer tax credit and expanding it to all homebuyers, making higher mortgage loan limits permanent, pushing banks to extend credit to Main Street, and prohibiting banks from entering into real estate.

“Housing has always lifted the economy out of downturns, and it is imperative to get the housing market moving forward as quickly as possible,” said NAR President Richard F. Gaylord. “It is vital to the economy that Congress take specific actions to boost the confidence of potential homebuyers in the housing market and make it easier for qualified buyers to get safe and affordable mortgage loans. We are asking Congress to act right away.”

Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said NAR, as the leading advocate for homeownership and private property rights, believes it is important for Congress to address the concerns and fears of America’s families, much in the way it has addressed Wall Street turbulence. “Housing is and has always been a good, long-term investment and a family’s primary step towards accumulating wealth,” Gaylord said.

NAR recommends Congress pass new housing stimulus legislation that includes the following priorities:

1. Remove the requirement in the current law that first-time homebuyers repay the $7,500 tax credit, and expand the tax credit to apply not only to first-time buyers but also to all buyers of a primary residence.

2. Revise the FHA, Fannie Mae and Freddie Mac 2008 stimulus loan limit increases to make them permanent. The Economic Stabilization Act, enacted in February, made loan limit increases temporary, and subsequent legislation reduced the loan limits and made them permanent. This has broad implication for homebuyers in high cost areas.

3. Urge the government to use a portion of the allotted $700 billion that was provided to purchase mortgage-backed

securities from banks to provide price stabilization for housing. The Treasury department should be required to use the newly enacted Troubled Assets Relief Program to push banks to:

available to consumers and small businesses;

(REOs) properties.

4. Make permanent the prohibition against banks entering real estate brokerage and management, further protecting consumers and the economy.

Gaylord said that NAR will strongly pursue those proposals and is calling on Congress to return to enact housing stimulus legislation in a lame-duck session after the national elections in November.

NAR is also working to ensure that the Emergency Economic Stabilization Act of 2008, signed by President Bush into law on October 3, will be effective. NAR closely monitored the Federal Government response to the credit crisis, and the Washington D.C. Policy staff worked with regulatory agencies and elected officials on Capitol Hill to assure a robust secondary mortgage market. Liquidity in the mortgage market is essential to the health of the economy.

NAR will continue to work with Congress and the Administration to make sure the measures included in this bill are implemented quickly.

“Housing is and has always been a good, long-term investment and a family’s primary step

towards accumulating wealth.” - NAR President Richard R. Gaylord

The National Association of Realtors® will offer a four-point legislative plan to reinvigorate the housing market, calling on Congress to act during a lame-duck session. NAR believes the plan will give a boost to the economy and help to calm jittery potential homebuyers.


-other major success for the tournament, with almost 100

-ing CID volunteers - Linda Emery, Debbie Anglin and Diane Lawson. In the photo above is the car brought by Ed Howard Lincoln Mercury for the hole-in-one contest.

one was awarded the car lease this year! Oh well!


Bro

ker

Co

rner Training agents on a tighter budget

By Robert Freedman

Eric Lee oversees 105 sales associates—including four or five new associates a month—at his Equity Real Estate branch just north of Salt Lake City. But Lee faced a problem shared by many brokers today: how to bring new recruits up to speed on the brokerage’s proprietary services and provide ongoing sales and legal training to his established associates without breaking his training budget.

Four years ago, Lee found his answer. He began hosting all his training online, reserving his in-person educational sessions for intensive coaching. Online training via webinars, or online seminars, lets him reach more recruits at a lower cost than traditional classroom sessions.

“We’re so big and spread out—we cover four counties in western Utah—it’s the best way to get the message to everybody,” says Lee, who today hosts two online sessions a day, involving up to 20 sales associates a session.

Tip 1: Try WebinarsLee’s online education sessions have virtually no

technology costs except for a subscription fee he pays for the webinar host. While Lee didn’t reveal his preferred hosting company, many online solutions providers offer webinar platforms to companies. One such provider, WebEx, offers webinar hosting with different pricing models, including pay-per-use or monthly subscription. Subscriptions start at about $40 a month. Costs are higher if you include document-sharing capabilities.

To make the online courses at Equity Real Estate cost effective, the brokerage charges new associates $200 up front and another $500 from their first two transactions.

Lee says the fees are necessary because the brokerage, a 100 percent commission company that limits its charges to a $499 per-transaction fee, doesn’t generate sufficient revenue from associates to absorb the training costs as an overhead expense. For their fee, the associates receive the webinar, plus a 100-page manual, a DVD with role-playing simulations, and a resource CD.

“When you factor everything in, the costs are equivalent to the associate earning a 90-10 commission split for their first two transactions,” he says.

Tip 2: Partner UpOnline education is just one way today’s brokers are

expanding their training options without draining their financial resources. With fewer than 30 associates, Craig

Plantz’s brokerage, Resident Realty in Fort Collins, Colo., lacks the scale to offer in-house training cost effectively. So Plantz partners with local title and mortgage companies to bring in speakers on special topics.

“They can bring in three to four other brokerages to help defray expenses for all of us,” says Plantz.

Title companies and mortgage lenders often step in to help cover class costs because they have the chance to share information about their services with sales associates during the sessions, Plantz says. Even so, Plantz ends up paying a nominal amount such as $20 per associate to cover costs for food and to defray the expenses of the trainer. He usually absorbs that amount rather than charge associates. (To avoid any implication of a RESPA violation, be sure that classes sponsored by an ancillary service provider are open equally to all associates.)

“It’s to my advantage for sales associates to have all the knowledge possible,” he says.

Plantz’s educational partnerships are limited to one-off classes, which typically address timely legal developments such as meth lab disclosure, changes in water rights, or new contract requirements. Sessions that cover proprietary topics such as marketing and sales techniques and in-house technology he covers himself at the office without outside partners.

Tip 3: Adjust Fees to DemandSharon Pelt, vice president of the Fonville Morisey Real

Estate School in Raleigh, N.C., is paring her training costs by charging sales associates at the company’s 11 offices an adjustable fee for certain high-interest courses.

For example, says Pelt, “Our licensing continuing education classes are extremely popular, and when we offer them for free people jump all over them.” For such popular courses, Pelt sets a time window before which the 750 associates at Fonville Morisey can attend the class for free. If they miss the window, she applies a charge. The charge is nominal, from $45 to $65; while that doesn’t fully cover the associate’s share of costs, it helps the brokerage keep expenses down by concentrating attendance into fewer sessions, says Pelt. The more associates that attend a class, the more cost effective the sessions are for the brokerage.

Well-known national trainers are also a big draw that warrants a training surcharge. At the height of the housing boom, Fonville Morisey brought in a two-day luxury home sales certification course and charged associates $499 to help cover costs. Even with the fee, the course attracted probably 40 percent more attendees


than other education programs. The success prompted the company to bring it back for a second run.

“The programs aren’t revenue generators for us, but we do need to cover costs,” says Pelt. “We try to work out an equitable deal on a case-by-case basis, and sometimes we just take the hit because our associates need it.”

Tip 4: Provide Free BasicsAlthough most of the special-topic sessions Mike Jarruti

makes available to the 260 associates at Vaughn Co., Realtors®, in Albuquerque, N.M., are free, he’s also begun charging for CE courses. Costs to his brokerage for accredited CE instructors tends to run higher because of their required material and testing—typically from $65 to $85 per person compared to about $35 per person for other courses—so Jarruti levies a modest fee to help ease the financial sting.

“We’ll charge each salesperson about $25 or $45, just to cover the cost of the instructor,” he says.

The brokerage takes an entirely different approach on basic training for new recruits. Through a program it calls Journey to Mastery, associates new to the industry attend mandatory training until they close six transactions, a process that typically takes between two and four months. The 48 hours a

week in training consists of classroom instruction, some of it taught by outside consultants, and hands-on field work such as staffing open houses.

The brokerage absorbs 100 percent of this training cost but makes it back in other ways.

First, it requires sales associates to commit to a one-year minimum with the brokerage. Second, it structures the field portion of the training not only to provide experience but also to help associates build their businesses. When working open houses, for example, associates are required to put up a minimum of 60 signs, including ones in the yards of surrounding neighbors. Because they must knock on neighbors’ doors to get permission to place the signs, “they get a lot of results from that,” says Jarruti. “Sixty to 70 percent of associates get follow-up appointments from the door knocking. It lets them get in front of people.”

Today, more than ever, brokers often find themselves caught between shrinking revenues and a growing need for training at all skill levels. Yet with an eye on your bottom line and on the use of partnering, online courses, and flexible fee arrangements, you can minimize the financial hit of education and still provide valuable training to your associates.

and save the economy from a deeper recession in the coming months. The event attracted a full house to the main auditorium.


pFor a change of pace, it will be an evening event and music and dancing will follow. Tickets will be limited so be sure to RSVP to Gail Shane at [email protected] or 941-713-8008 to ensure your spot at this not-to-be missed event.

The final 2008 Governing Board meeting will be Friday, December 12 as a late afternoon meeting followed by “afterglow”. Please contact me for time and directions. The 2009 Governing Board will begin meeting in January.

In September, many of our members attended the WCR/FAR annual conference at Orlando. We were so pleased to have our own Amy Worth Paul named district Governor of the year. We were not surprised and she followed that up by being elected State Secretary for 2009. If Amy follows the traditional path “through the chairs”, she will be State President in 2013. We are so proud of her.

We would also like to congratulate the Fort Meyers chapter on being named Chapter of the Year. They have done a tremendous amount of work this year and we are so pleased for them.

November will be a very busy month for the local chapter. Not only will it bring us the national election on the 4th (don’t forget to vote), the NAR/WCR conference in Orlando is the 5th to the 9th. Women’s Council is all about networking and this will be an excellent opportunity for our local members to meet and network with Women’s Council members from all over the country. Jon Gordon, author of” The Energy Bus” will be the keynote speaker for the General Assembly and many other national speakers such as Amy Chorew, Robert Morris, and Chris Bird will be

providing educational sessions. Florida’s own Ann DeFries, 2008 National President will “pass the gavel” to incoming 2009 President Becky Hill from Texas. Ann has been an inspirational leader and we were honored to have had her guidance this year.

Our Governing Board meets on the 10th and will be followed by a Programs Committee meeting. The final program is November 14 which will be a networking event coupled with the annual chapter awards. A number of our members will be honored at this event, which will be held at Fete (formerly Fred’s in Lakewood Ranch) and starts at 6 PM. There will be a Chinese Auction, cocktails, Hors d’Oeuvres and lots of networking opportunities. You will not want to miss that event

The Sarasota Women’s Council appreciates our 2008 Program Sponsors. Silver Level: Bank of America - Robin Fagin; and Neal Communities. Bronze Level: Alliance Appraisal Associates, Inc.; The Founders Club; Leider Realty Group, LLC; Oswald, Trippe and Company, Inc.; and Sarasota Coastal Credit Union.

And our state sponsors: Platinum Sponsors: EXIT Realty Florida, HomeTeam Inspection Service, North American Title Company, State Farm Insurance, Wells Fargo Home Mtg. Gold Sponsors: Bank of America, Florida Real Estate Team, Stewart Title Guaranty, The Real Estate Book, Washington Mutual Bank. Silver Sponsors: Anderson Auctions, Attorneys’ Title Insurance Fund, Inc., Bright House Networks, Hughes Exterminators, Kenyon Real Estate Referral & Relocation, Harper & Pinzino Island Realty, Taylor, Bean and Whitaker Mortgage Company, Third Federal Savings and Loan

Women’s Council of Realtors® preparing for 2009 Installation

President-Elect Janice Litke and her installation committee are preparing for the installation of the 2009 line officers on December 4 at Marina Jacks.

By Cari Faanes-Blakey, 2008 WCR President

Cari Faanes-Blakey President Rooks Morris Real Estate Cell: 941-539-5117 [email protected]

Janice Litke President-Elect Prudential Palms Cell: 727-403-1814 [email protected]

Line officersTheresa Morrow Vice President of Membership Keller Williams Gulf Coast Phone: 941-737-7676 [email protected]

Mary Conklin Treasurer RE/MAX Alliance Group Cell: 941-504-4292 [email protected]

Karen Grant Recording Secretary RE/MAX Tropical Sands 941-349-3460 [email protected]

Sherry Bittner Corresponding Secretary American Family Financial Cell: 941-504-1445 [email protected]


All sedminar at SAR in mid-October. Representatives from Fannie Mae, HUD, Stewart Titl, Bank of America and Credit Counseling were on hand to explain some of the changes to the guidelines for mortgage lending in recent weeks. An afternoon session was held, attracting a full house, and an evening session was also held for the benefit of the public.

Advertiser Alert You can now get your business advertisement in the pages of Sarasota Realtor® Magazine

for a lot less.

How much less?How about only $75 for a Business Card size ad? Sell a used car, old electronics, used computers or

monitors, or promote your business! (See sample ad on P. 25)

You can also take advantage of a 10 percent member discount!

Call 328-1168 TODAY!


Mem

bers

hip

New

sDesignated Realtors®

Daniel, Kathleen, Kathleen Daniel R E BrokerGross, Edward, Monarch One Realestate LLCHarraway, Charley, Charley Harraway JR RE BrokerPruitt, James, Pruitt Real Estate Inc.

New MembersBarritt, Beverley, Ian Black Real EstateBayne, Tenaha, Blakeley & Associates RealtyCarlo, Greta, Coldwell Banker Res R ECinque, Joseph, Johnston Realty of SarasotaCulverwell, Robert, Prudential Palms RealtyDiGiovanni, Margie, Rooks Morris Real EstateEash, Joey, WEICHERT Realtors DowntownEngels, France, Rooks Morris Real EstateFinch, Michael, Research Realty Services LLCFoldes, Wendy Kay, Cityscapes Int’l Realty Group Frederick, Elaine, Andrews & Associates RealtyGarcia, Kristina, Candy Swick & CompanyGilleland, Susan, Coldwell Banker Res R EGoldman, Steven, Cityscapes Int’l Realty GroupGraber, Philip, Harry Robbins Assoc Inc.Gray, Robert, Horizon RealtyHegarty, Kerry, Blakeley & Associates RealtyHeuer, Ian, Hunt Florida Real EstateHorn, Lois, Coldwell Banker Res R EIvan, Patrice, Jennette Properties Inc.Jones, Liliana, Blakeley & Associates RealtyLyons, Amelia, Cityscapes Int’l Realty GroupMinton, Mark, Realty Executives SolutionsNaldrett-Bilodeau, Pat, Engel & Volkers Sarasota RealtyNiezgoda, Jillian, Atchley International RealtyOttewell, Karen, Prudential Palms RealtyPayne, Bonnie, Horizon RealtyPickard, Tammie, RE/MAX Alliance GroupScates Caudill, Bonnie, Estate Brokers Of Florida Inc.Sheeler, Jill, Jennette Properties Inc.Sparr, Jay, RE/MAX ExcellenceStorhoff, Diana, Coldwell Banker Res R EWalker, Daniel, Hunt Florida Real EstateYates, Richard, Coldwell Banker Res R E

Now WithAndruzzi, Karen, Coldwell Banker Res R EApplegate, Diane, Keller Williams Lakewood RanchAviles, Lillian, Mapp Realty & Investment Co.Barnett PA, James, Hunt Florida Commercial R EBeles, Fred, Hunt Florida Commercial R EBell, Regina, Exit Realty Signature PropBernas, Mary, WEICHERT Realtors On The CircleBiederman PA, Joseph, Allison James Estates & HomesBrissette, Edith, Allison James Estates & HomesBrowning, Charles, Keller Williams Greater ManateeBurns, William, Hunt Florida Commercial R ECampbell, Lori, RE/MAX Alliance Group

Cleary, Sandra, RE/MAX Alliance GroupColabella, Annette, Jennette Properties Inc.Colacicco, Susan, Allison James Estates & HomesDearing, Nina, Michael Saunders & CompanyDeshaies, Stephanie, Coldwell Banker Res R EEash, Joey, WEICHERT Realtors DowntownFerrell, Rita, Ramar Realty of SW FL Inc.Finch, Michael, Research Realty Services LLCFlynn, Ronald, Prudential Palms RealtyFoldes, Wendy Kay, Cityscapes Int’l Realty GroupFrederick, Elaine, Andrews & Associates RealtyGrooms, Leigh Ann, Integra Realty GroupGulacsy, Adam, Coldwell Banker Res R EHaser, Edward, Keller Williams Gulf ViewHays, Michael, Michael Saunders & CompanyHegarty, Kerry, Blakeley & Associates RealtyHenthorn Jr., Oak, Abbey Realty LLCHill, S Mark, Real Estate Market CenterHill, Theresa, Great American Realty GroupHochman, Stanley, WEICHERT Realtors On The CircleHoran, Francis, Prudential Palms RealtyHorn, Lois, Coldwell Banker Res R EIvan, Patrice, Jennette Properties Inc.Jones, Liliana, Blakeley & Associates RealtyKelly, William, Allison James Estates & HomesKirsch, Dianne, Allison James Estates & HomesKistler, Richard, Hunt Florida Commercial R EKitsemble, Stephanie, Gulf & Bay Club Condo AssnKraines, Christy, Piro & AssociatesLayfield, Sandra, Michael Saunders & CompanyMaier, Robert, WEICHERT Realtors On The CircleMiracle, Jana, Florida Int’l Properties GroupMyers, Richard, Allison James Estates & HomesNay, Tom, Hunt Florida Real EstateNink, Michael, Michael Saunders & CompanyO’Brien, John, Allison James Estates & HomesPendley, Deborah, Monte Davis RealtyPippin, Micah, Hunt Florida Real EstatePirot, Gerard, WEICHERT Realtors On The CirclePrimont, Derek, Exit Realty Gulf CoastQuigley, Jay, Coldwell Banker Res R ERoemer PA, Jennifer, Harry Robbins Assoc Inc.Saoud, Mike, Florida Realty GroupSchemmel, Antonia, SKY Sotheby’s Intl RealtySchnoerr, Rose, SKY Sotheby’s Intl RealtyScragg, Kevin, Mapp Realty & Investment Co.Serbu, Mariana, WEICHERT Realtors DowntownSheeler, Jill, Jennette Properties Inc.Simmers, Nancy, Jennette Properties Inc.Slater P.A., Monica, Michael Saunders & CompanyTriolo, Kristin, Cityscapes Int’l Realty GroupWalker, Daniel, Hunt Florida Real EstateWanting, Walter, Keller Williams Lakewood RanchWillman, Robert, Hunt Florida Commercial R E

The Association is pleased to welcome new members!

Continued on P. 31, see MEMBERSHIP


International R

eal EstateYoutzy, Toyia, Jennette Properties Inc.Zuffa, Linda, WEICHERT Realtors On The Circle

New Affiliate MembersCovenant Mortgage Corp1718 Main Street Suite 301Sarasota, FL 34236Phone Number: 941-350-3001Representative: Thomas SchmidtSpecialty: Residential Lending Company-Providing “WORLD CLASS SERVICE” & Solutions

ESC-Engeneering Svc Consultancy100 3rd Avenue WestBradenton, FL 34205 Phone Number: 941-567-1618Representative: Karl WhiteSpecialty:Energy & Sustainability Consultants

for the Construction Industry, including Energy Ratings

E.T.M.R. Services5008 25th Street EastBradenton, FL 34203Phone Number: 941-756-7605Representative: Edward J ThomasSpecialty: Mold Inspection and TestingSpecialty: Site developer, specializing in construction management, site selection and site preparation.

Trustco Bank1300 S. Tamiami TrailOsprey, FL 34229Phone Number: 941-918-9380Representative: Jeanne MenardSpecialty: Full Banking services, including mortgages, equity lines, loans and affordable housing programs

MEMBERSHIPFrom Page 30

By Renea M. Glendinning, CPA

When a nonresident individual owns rental real estate in the U.S., there are two alternatives for reporting and paying U.S. income taxes.

The individual may choose to not file an income tax return in the U.S. to report the rental income. In this case, 30% of the gross rental income must be remitted to the Internal Revenue Service. If the rental is handled by a rental agent, the agent must withhold and remit the 30% as rent is collected. If no rental agent is involved, then the nonresident owner is obligated to pay the 30% to the Internal Revenue Service.

Most nonresidents do not choose the first option. Instead, they report the rental income on a U.S. income tax return, Form 1040NR. They must report the rental income received, but, unlike the first option, all expenses associated with the property are deductible against the rental income. These expenses include property taxes, mortgage interest, repairs, etc. In addition, a calculated amount for depreciation is also deducted. A personal exemption of $3,500 in 2008 is also allowed. The

majority of owners do not have any taxable income after taking into account all of the deductions that are available. If there is no taxable income, then there is no tax to pay. In addition, any excess expenses accumulate and carry forward indefinitely and are available to offset profit on sale.

In order to avoid the 30% withholding on the gross rental income, the nonresident owner must provide a Form W-8ECI to the rental agent. The Form W-8ECI informs the rental agent that the owner is electing to treat the rental activity as a U.S. trade or business and obligates the owner to file a U.S. income tax return to report the rental activity. The nonresident owner must also apply for and obtain a U.S. taxpayer identification number (ITIN), if they have not previously obtained one or if they do not possess a U.S. social security number. This identification number can be obtained by filing a Form W-7 with the Internal Revenue Service.

The tax year is based on the calendar year and the tax returns are due no later than June 15 of the year following the tax year. If not completed by June 15, an extension request can be filed which will extend the filing date until December 15.

How should you handle income tax reporting on rental property income for non-residents of the U.S.?


MFRMLS Training:

Regular MLS system training have resumed, with classes conducted

by the Mid-Florida Regional MLS. Watch for times and dates

and in the Weekly Update digital newsletter!

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Mon. Nov. 3, 2008 through Fri. Dec. 12, 2008

MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY

3 4 5 6 7

9:00 a.m. & 2:30 p.m. New Members9:00 a.m. – 12:00 p.m. Intro to MLXchange HANDS ON1:00 p.m. – 3:00 p.m. Entering & Updating Listings

8:30 a.m. CID Board Meeting

9:00 a.m. & 2:30 p.m. New Members9:00 a.m. – 12:00 p.m. Creating Custom Reports HANDS ON1:30 p.m. – 3:30 p.m. Creating a CMAHANDS ON

8:00 a.m. MLS Zone 1, University Park CC9:00 a.m. – 12:00 p.m. Design Web Pages HANDS ON1:00 p.m. – 4:00 p.m. ToolsHANDS ON

9:00 a.m. New Members 9:00 a.m. – 12:00 p.m. Intro to MLXchange HANDS ON1:00 p.m. – 4:00 p.m. MLX AdvancedHANDS ON

Please Note: Mid-Florida Regional MLS training classes are available throughout the month!

10 11 12 13 14

9:00 a.m. & 2:30 p.m. New Members9:00 a.m. – 4:00 p.m. New Member Orientation1:00 p.m. – 4:00 p.m. Code of Ethics Training

9:00 a.m. & 2:30 p.m. New Members9:00 a.m. – 12:00 p.m. Code of Ethics Training w/3 HRS CE

8:00 a.m. MLS Zone 2, Pine Shores CC

9:00 a.m. New Members

17 18 19 20 21

9:00 a.m. & 2:30 p.m. New Members8:30 a.m. – 11:00 a.m. International Real Estate Roundtable

8:00 a.m. CID General Membership Meeting

7:30 a.m. – 9:00 a.m. WCR Toastmasters9:00 a.m. & 2:30 p.m. New Members

8:00 a.m. MLS Zone 3, Pine Shores CC


24 25 26 27 28

9:00 a.m. & 2:30 p.m. New Members


SAR Closed - Thanksgiving Holiday

SAR Closed - Thanksgiving Holiday

For more info on Educational Programs, please see pages 20-23

Dec. 1 2 3 4 5


8:00 a.m. CID Holiday Breakfast

7:30 a.m. – 9:00 a.m. WCR Toastmasters8:30 a.m. – 5:00 p.m. REO Certification Course9:00 a.m. & 2:30 p.m. New Members

8:00 a.m. MLS Zone 1, University Park CC8:30 a.m. – 5:00 p.m. REO Certification Course


8 9 10 11 12

9:00 a.m. & 2:30 p.m. New Members9:00 a.m. – 4:00 p.m. New Member Orientation1:00 p.m. – 4:00 p.m. Code of Ethics Training9:00 a.m. – 11:00 a.m. MFR Tools/Mongo Fax

9:00 a.m. – 12:00 p.m. Intro to MLXChange HANDS ON1:00 p.m. – 3:00 p.m. Entering & Updating Listings

9:00 a.m. & 2:30 p.m. New Members9:00 a.m. – 11:00 a.m. Red Flags on the Waterfront9:00 a.m. – 12:00 p.m. Creating a CMA HANDS ON1:00 p.m. – 3:00 p.m. Creating Custom Reports

8:00 a.m. MLS Zone 2, Pine Shores CC9:00 a.m. – 12:00 p.m. iMAPP HANDS ON

1:30 p.m. – 4:30 p.m. Design Web PagesHANDS ON6:00 p.m. – 10:00 p.m. Installation Banquet- Michaels on East

9:00 a.m. New Members 9:00 a.m. – 12:00 p.m. Intro to MLXchange HANDS ON1:00 p.m. – 4:00 p.m. MLX AdvancedHANDS ON

how do real estate professionals sell the sarasota … market, sarasota has always emerged as a...

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