When Don Faught speaks, other Realtors listen Editor's Blog, posted by Jeb Bing, editor of the Pleasanton Weekly, on Feb 25, 2011 at 9:00 am Jeb Bing is a member (registered user) of PleasantonWeekly.com
When Don Faught speaks, others listen, or at least other Realtors did last week when Faught talked about the changing work environment in real estate to a large audience at the Valley Real Estate Network meeting at Tommy T's. Faught, vice president of Alain Pinel Realty and managing broker, has been in the business for 24 years, the last eight at here in Pleasanton. With new regulations, a tight mortgage money market and banked-owned (REO) and short sales now accounting for 40% of all home sales, the good old days of handshake deals and quick transactions by home buyers and sellers are over.
Because the real estate market is becoming increasingly complicated, Faught says Realtors are the best "go-to" people that home buyers and sellers should deal with. Not only do Realtors have the professional experience and ongoing and regularly updated training to steer transactions through the multitude of hurdles now in place, they're also the ones who can help those who might be in danger of losing their homes. Foreclosure lists are still growing as low-interest mortgages convert to higher rates that some homeowners can't afford. Foreclosures should be avoided at all costs, Faught says, and Realtors are in the best position to counsel those at risk on how best to handle their dilemma. After all, Realtors have a vested interest in maintaining home values in the communities they serve and in doing what they can to keep homeowners in their homes, even if it means no commission for their service. That can come later when the homeowner's back on his feet financially and decides to trade up to a more expensive property.
Short sales aren't much better and, as Faught points out, aren't "short." In fact, they can take months, even as long as a year as the owner pays what he can while a willing buyer waits out the process. With so many short sales in progress and many financial institutions unable to keep pace, the risk to the seller who thinks he has a buyer is that the sale is scuttled when the buyer finds a better deal and leaves the table. A Realtor with experience in handling short sales can help press the bank for a speedier outcome, saving the seller from losing the property altogether as well as his credit rating.
Faught is treasurer of the prestigious California Association of Realtors and is a candidate for president-elect in that organization's elections in May. If he wins, and so far he has no opposition, he'll be CAR's president in 2013. As an officer, he makes frequent trips to Washington, D.C., to help the CAR and those at the National Association of Realtors (NAR) lobby for (or against) legislation that impacts home sales. Recently, he helped diffuse proposed federal legislation that would have required costly energy-saving, environmentally-friendly retrofits of homes at the point of sale and at considerable added costs to the sellers. In California, he's worked to curtail legislation proposed by the Gov. Jerry Brown administration that would have added $12.5 million in "fees," including special fees on services such as termite and roof inspections, mortgage loan processing and more. So confident was the administration of imposing this fee structure before realizing a two-thirds majority vote in the Legislature wasn't there that the Statehouse is now scrambling on where else to find the $12.5 million it has already programmed into its new budget proposal.
Another concern of Faught's is a plan being advanced by the Obama Administration to take away federal interest loan tax deductions. The cap for these deductions has been set at the $2 million mark for years. Obama wants to lower that threshold to $500,000 and for the taxpayer's primary home only. That lower cap, of course, would affect most homeowners in Pleasanton and in much of California and a few other states which have high housing costs. So far, Faught believes that proposal is on the back burner but it's there for all of us to watch. He also told Realtors that the Feds want to lower to $625,000 from the current $729,000 the amount of mortgages that qualify as conforming loans. Above that, loans would be considered "jumbo," subject to much higher interest rates.
With Faught working the halls of Congress and the Capitol in Sacramento, it's no wonder his remarks drew loud applause from other Realtors who, along with their clients, stand to benefit.
Posted by One size doesn't fit, a resident of the Another Pleasanton neighborhood neighborhood, on Feb 25, 2011 at 10:03 am
Again, and again, folks from Toledo, Tulsa, Timbuckkto,and Omaha write laws and set standard US charts for National LIMITS to income for college loans, home price limits for Fannie and Freddie for all sorts of programs, income taxes for workers, on and on, etc.
Our area is left out or treated differently than the rest of the country. DC treats the GREATER Bay Area differently than 99% of the country, which is very unfair to us. Incomes and home prices in 99% of the country are very different than this area. But . . . .
Mz Speaker Pelosi nor Mr McNerney never stood up on any of these issues defending our 9-10 counties that get the raw end, no matter the issue.
Many times in the last 2-3 years, I couldn't understand that they wouldn't stand up for residents of the Greater Bay Area...yet, no matter how badly CAifornians get excluded from the nation, they continue to elect the same people, so nothing ever changes.
Posted by One size doesn't fit, a resident of the Another Pleasanton neighborhood neighborhood, on Feb 25, 2011 at 11:28 am
Faught's 'Jumbo' loan limits is a perfect example...it works for DesMoines, Nashville, and Santa Fe, but it does not work for Petaluma or Pleasanton...I'm not talking just SanFran and PaloAlto.
MzSpeaker controlled the agenda. You'd think being from CA she would have spoken up for us on a long list of mistreatments like the jumbo loan and all the special mortgage situations 2 years ago.
Income taxes from 'higher' incomes and higher home prices here are very different than the comparable houses that only cost $300,000. in the rest of the US, and our income which sound high to the Senators from Iowa...think rich BayAreans who have to commute in 2 cars going different directions, have triple house prices, higher income TAXES....so college loans, jumbo loans, or any US gov't chart discriminates against us ! One size does not fit all.
Posted by concerned buyer, a resident of the Another Pleasanton neighborhood neighborhood, on Feb 25, 2011 at 11:54 am
"home price limits for Fannie and Freddie for all sorts of programs"
You are aware that the jumbo loan limits are much higher in the Bay Area than in " Toledo, Tulsa,...", right.
Regarding Fanny, Freddie, tax deduction on interest, and all the other stuff the government does to "encourage home-ownership", you'd think maybe we would learn the lesson that inflating asset bubbles leads to downturns like the one we've just been through. Maybe it is time to get the government out of the business of encouraging home-ownership.
Posted by concerned buyer, a resident of the Another Pleasanton neighborhood neighborhood, on Feb 25, 2011 at 11:58 am
"Faught's 'Jumbo' loan limits is a perfect example...it works for DesMoines, Nashville, and Santa Fe, but it does not work for Petaluma or Pleasanton...I'm not talking just SanFran and PaloAlto."
Disagree. It doesn't work anywhere. Government sponsored entities should not be setting thresholds for load guarantees. Does anyone realize we just experienced the popping of a real estate bubble, and that has had a devastating effect on the economy? The Bay Area already has a higher jumbo limit ($729,000) than most of the rest of the country. Property values remain inflated. We need to get the GSEs out of this business altogether.
Posted by system unfair, a resident of the Pleasanton Heights neighborhood, on Feb 25, 2011 at 2:08 pm
There should be no tax incentive for home ownership at all. Canada has never allow tax deductions for mortgage interest and they have never taxed the gain on the sale of homes. Realtors are only too happy to encourage buyers into contracts that they cannot afford because the 6% commissions are so tempting. The buyers get to take tax deductions and then default on the loans with no tax consequences at all. The rest of us pick up the cost.
How about this for being more fair:
When a realtor sells a home to what is actually an unqualified buyer, who later defaults, the realtor has to pay back the commission earned into a fund to offset the bailouts.
When a mortgage broker writes a loan for an unqualified buyer, who later defaults, he has to repay the commission also.
When a buyer who was greedy/stupid/or both defaults on the loan they have to amend their tax returns to pay back the taxes that they saved since the government is making the rest of us pay for their default.
If the profit motive was not there for these people to overinflate and oversell properties much of the problem would never have happened.
Posted by One size doesn't fit, a resident of the Another Pleasanton neighborhood neighborhood, on Feb 25, 2011 at 7:27 pm
So, concerned and system,you want to change the topic from discrimination to elimination. Elimination is OK with me, but this thread is about the abusive open discrimination specifically against the people of the greater Bay Area. So, you think it's OK for OUR government to selectively discriminate against us? That we pay for our 'differences'. I say our 'NET' taxes or opportunities should be equalized, so when 2 houses are idential in every way, one owner pays $700k so is called rich because of the price and is thus not eliglble for programs, the other identical home owner is called average because his home is only $300k in the midwest. OUR government is not treating us equal, when going by the numbers. Yes, if the government discriminates or favors, then it should not do 'whatever' at all.