Re view julaug2013 issuu by Northern Virginia Association of Realtors®

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July :: August 2013

Real Estate Now July/August

New Brand, New magazine, New Day … NVAR Takes you Further

Volume 96, Issue 4

2013 BOARD OF DIRECTORS Chairman of the Board: Jon Wolford Chairman-Elect: Mario Rubio, CIPS, SRES Immediate Past Chairman: Pat Kline, CIPS, GREEN, GRI, SRES, TRC Secretary/Treasurer: Mary Bayat, GRI DIRECTORS-AT-LARGE Bob Adamson, CRS, GRI Lorraine Arora, ABR, GREEN, GRI, SRES Julia Avent, ABR, CRS, GRI Brian Block, ABR, CRS, e-PRO, GRI, SRES Moon Choi Tracy Comstock, ABR, ASP, BPOR, CIPS, e-PRO, GREEN, GRI, SFR Heather Embrey, ABR, e-PRO, GRI, SRS, SRES, SFR Virgil Frizzell Suzanne Granoski, ABR, ASP, CDRS, GRI Thai-Hung Nguyen, ABR, CRS, SFR Christine Richardson, CDPE, CRS, GRI Nancy Harvey Steorts, ABR, GREEN, GRI, TRC Publisher/CEO: Christine M. Todd, CAE, RCE Editor-In-Chief: Jill Parker Landsman Managing Editor: Ann Gutkin Associate Editor: Amy Larrabee Advertising Sales: Tracy Reynolds Photography: Kipp Burgoyne Graphic Designer: Wanda Ng Fontana Contributors: Frank Dillow, Laura Farley, Cameron Hames, S. Michael Lynn, Lisa Vierse May, Liz Milner, Ryan D. Paris, Sarah Louppe Petcher, David Versel

Interested in advertising? Please call 703. 207. 3206 for information. The RE+VIEW (ISSN 10988475) is published bi-monthly by the Northern Virginia Association of Realtors® as follows: combined issues for January/February, March/ April, May/June, July/August, September/October and November/December. Periodicals postage paid at Fairfax, VA 22030 and additional mailing offices. Subscriptions account for $19 of each member’s annual dues. Annual subscriptions are available to nonmembers for $39. Subscription inquiries may be sent to the RE+VIEW c/o Northern Virginia Association of Realtors® at 8407 Pennell Street, Fairfax, VA 22031-4601. Copyright 2013 by the Northern Virginia Association of Realtors®. All rights reserved. Postmaster: Please send address changes to: RE+VIEW Northern Virginia Association of Realtors® 8407 Pennell Street Fairfax, VA 22031-4601 Telephone: 703.207.3200 | FAX: 703.207.3268 Web: nvar.com E-mail: re+view@nvar.com Advertising Info: arlenetbg@comcast.net

By Jon Wolford

It is an honor to write the first Chairman’s Column for our new RE+View! It’s like being the first to run through a blanket of freshly fallen snow! It’s that first date with “the one.” It only happens once, and everything changes from there. And, so much is changing, isn’t it? Our business changes every day: interest rates, prices, appraisals, inventory, laws affecting our industry...it’s all so hard to keep up with! That’s why NVAR continues to provide the top-ofthe-line programs and services that keep you going. We want to change and improve with you. These initiatives are all being done to maintain our commitment to provide cutting-edge tools that enable your success. It’s why we chose the tagline... “Takes You Further.” It goes into every decision made by staff and leadership at NVAR. We will go to any length; yes, with RazorPath and NVAR’s other online offerings, we will meet you at your office and we will come to your home to deliver the products and services you need. So, go ahead and take your training or shop for business supplies in your jammies if you want. You can even get answers to your legal questions while you’re at home or on the go. Once it’s launched, take advantage of our complimentary offer to “Sharpen Your Skills” at razorpath.org. Just sign up by midnight, September 3. We’re here to help, but your business is in your hands—and so is this magazine. So... enjoy the new RE+View! And please let me know what you think. Email me at chairman@nvar.com. Our promise and commitment is to never become too busy to listen. By understanding your needs we will continue to provide the products and services that “Take You Further.” Cheers!

Jon Wolford 2013 Chairman of the Board

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Join us on... Ads in RE+VIEW magazine do not necessarily carry the endorsement of NVAR.

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TAKES

YOU

FURTHER

10 Government Affairs Forum: Signs – Here Today, Gone Tomorrow

9 Legislative Reception: Area Lawmakers Feted

6 Inside Scoop: Announcing NVAR’s New Brand

12 Appraisal Forum: Best Practices for Agents

21 NVAR Blood Drive: Save a Life on 7/29

8 Coming Soon: RazorPath Online School

14 Finance Forum: Rules, Regs and Real Estate Finance

28 “Ask Me!” Ambassadors: Learn & Share Local Fundamentals

16 Well & Septic: Part Two A Realtor’s® Guide

30 Fundraising Luncheon: Support for Delegate Greason

20 Radon Mitigation: Is It Needed?

35 Multi-Million $ Awards Program: Members Celebrate Success

22 Commercial Notes: RPR Provides Value

42 Public Policy Forum: Future of Rt. 1

24 Rent vs. Buy: Analysis of Washington Region

46 Ask NVAR: Appraisers and Sales Price; Lockbox Rules

31 Legal Summit 2013: Avoiding Common Pitfalls 34 NVAR Form Changes: Now In Effect 38 New Property Tax Rates: Effective for NoVA Jurisdictions

28 Save the Date: Eco Summit (9/5) 32 Save the Date: Convention (10/15) 33 Save the Date: Politics & Pancakes (10/15)

NVAR DEPARTMENTS 37 Education: Changes to PL Curriculum

40 Class Schedules

38 Membership: Brokerage Transfers; Committee Opportunities

43 NV/RPAC Investors

39 New Members Welcomed

44 Appraiser & Affiliate Directories

The views expressed in this publication may not reflect NVAR policy, and may be the opinions of the writer or interviewee.

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inside scoop

NVAR Takes You Further.

NEW LOGO, TAGLINE UNDERSCORE PROMISE TO MEMBERS By Jill Parker Landsman & Warren McKenna

Audiences were at the edge of their seats when Jon Wolford, NVAR Chairman of the Board, announced something very exciting would be coming to NVAR. On June 12, 2013 an audience of more than eighty leaders convened at NVAR HQ in Fairfax to unviel a shhh....surprise!—turned out to be extraordinary. During the past six months, NVAR staff and leadership did some soul searching. The team tried to answer two pivotal questions, “how do we create even more value for members” and “how do we ensure they ‘get it’?” These became directives for a total product and service overhaul starting with the NVAR brand. At the unviel Wolford said, “‘Takes You Further’ is our motto and our promise to continue to do whatever it takes to provide our members and our affiliate members with the best Realtor® association in the country.”

Christine M. Todd, NVAR Chief Executive Officer, said “We take great pride in having built an association that has emerged as a leader, and the driving forces that have led to this: our proven record for excellent member benefits and services. We feel like we’ve communicated that very well with these changes.” Spearheading the brand reinvigoration effort are Warren and Elizabeth McKenna, Principals of McKenna Design Group a Chicago-based communications and technology company. Warren McKenna adds, “The new branding signals to members NVAR is innovative and ahead of the curve. NVAR is positioned to deliver tangible value to members—that is carried on as a direct benefit to better engage consumers in the market place.” Stay tuned for a downloadable ‘member version’ of this logo to demonstrate to consumers—a powerful affiliation. Yours!

Read What Our Members Say About Our New Brand

We are coming out of one of the worst and longest downturns in the industry and it is time for a fresh new look for NVAR: a new logo and tagline. The association has launched many new programs and is offering the members new features that will take them further with their career and professionalism. Forms online, discounted electronic signature, passport to reduce the cost of classes, legal hotline for help, and so much more. – Julia Avent

I know NVAR “TAKES ME FURTHER.” NVAR provides me with information and resources that I otherwise would never have the time to explore since I’m too busy helping consumers fulfill their dream of homeownership. – Heather Embrey

The new logo demonstrates NVAR’s commitment to its agents. Moving with the times, the new look is fresh and bold yet unifying what our association stands for: service and education challenging its members to be the best that they can be! – Lorraine Arora

What a great step forward for our association! It truly reflects our diverse markets, and I really like its modern, dynamic and upward feeling! – Moon Choi

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inside scoop

From Great to Extraordinary

New MAGAZINE, NEW ONLINE REALTOR® SCHOOL—DOUBLE AWESOME By Jill Parker Landsman & Warren McKenna

YOU BET WE DID IT. How did we take an already great magazine and make it even better? The NVAR communications team conducted an exhaustive look into today’s publication design and best practices. We are pleased to introduce the new RE+VIEW magazine, a recommitment to deliver the best information and services NVAR can muster! In a recent survey, we learned that more than 85 percent of members read each issue. RE+VIEW capitalizes on that success to deliver valuable information with the following enhancements: • New name – conveys a renewed spirit of timely, relevant info • Incorporates Real Estate (RE) in the name, plus (+) • Offers important local and industry-driven perspectives (VIEW) • Updated masthead with the promise of Real Estate Now.SM • Redesigned table of contents, Takes / You / Further • More white space to make scanning easier, reading faster • Updated design for trend info, data, research and more • Go-to resource to share with clients and colleagues

coming very soon RazorPathSM, NVAR’s ambitious entry to the world of online Realtor® education, offers unparalleled access to continuing education, special programs and online video. Agents can “sharpen their skills,” as the service’s tagline promises, 24-7-365 at RazorPath.org. Starting this summer! “These changes expand NVAR’s capabilities to meet the needs of Realtors® and Affiliate members who also want to take their business to the next level,” said Christine M. Todd, NVAR Chief Executive Officer.

To view the new RazorPath Online School video, visit: go.nvar.com/RazorPathLaunch. 8

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legislative reception

Area Legislators Feted at Annual Legislative Reception After a General Assembly For the History Books NVAR’s Public Policy Committee hosted a Legislative Reception at the Fairfax Headquarters on May 8 to thank members of the General Assembly for their support of the historic transportation bill which passed earlier this year. The annual event, sponsored by affiliate member ATG Title, drew 26 legislators and more than 100 NVAR members. NVAR has long supported new and sustainable funding for transportation. Addressing the audience, Chairman of the Board Jon Wolford noted that “while this was not a perfect bill, it provides billions in much needed revenue for both roads and transit. This is a step forward in restoring Virginia’s ranking as the top state for business in the nation.” Wolford gave special thanks to several elected officials who had long led the fight for new transportation funding. They include Delegates Vivian Watts (D-39), Tom Rust (R-86) and Dave Albo (R-42), as well as Senator Janet Howell (D-32). Also during the 2013 session, elected officials from Northern Virginia worked on Realtor® legislation that included: 1. streamlining the hearing process for fair housing violations; 2. adding additional Condo and POA resale packet disclosures about federal financing and providing information about solar panels to assist buyers in evaluating the development; and 3. clarifying the treatment of escrowed rental funds.

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NVAR Board member Lorraine Arora expresses her gratitude to Del. Tom Rust (R-86). Spreading good cheer and thanking their legislators at the reception are (l-r): NVAR Board member Brian Block with Del. Vivian Watts (D-39), plus Realtor® Maria Nicolau, NVAR Secretary/Treasurer Mary Bayat and NVAR Chairman Jon Wolford. (L-R) Realtor® Miguel Calvo, Del. Eileen Filler-Corn (D-41), Del. Scott Surovell (D-44), and Realtors® Lawanda Swope, Angie Delboy, Cinnamon Pham and Luan Bui enjoy the reception in the NVAR atrium. Local and state legislators from both sides of the aisle put politics aside to spend time with constituents and colleagues. Pictured (l-r): Delegates Dave Albo (R-42), Eileen Filler-Corn (D-41) and Randy Minchew (R-10). (L-R) Alexandria City Councilman John Chapman (D), Del. Alfonso Lopez (D-49), and Del. Tag Greason (R-32) were among the elected officials thanked for their service to our region.

Del. Rob Krupicka (D-45) enjoys accolades from NVAR Realtors® as they celebrate successful legislation from the 2013 session.

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Supervisor Jeff McKay (D-Lee District) joins Realtors® Patti Mancini(l) and NAR’s 2012 Good Neighbor Award recipient Trudy Harsh(r).

government affairs

Signs: Here Today, Gone Tomorrow

NVAR Public Policy Forum Explains New Fairfax Sign Enforcement Program By Lisa Vierse May

Improperly placed open house signs can cost you more than a sale. They can also result in confiscated signs and a loss of hard-earned money.

As of July 1, Realtors速 in Fairfax County must pay special attention to the location of their directional and open house signs. Under an

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agreement between the County and VDOT, officials began enforcing sign regulations, and issuing fines, on week-days. Placing signs in the highway rightsof-way has always been prohibited in Fairfax County under Federal Highway Administration rules. However, enforcing those provisions proved difficult for County staff. As a result, the number of commercial signs in the rights-of-way has grown exponentially, as has public backlash against them. NVAR worked with the County to devise an enforcement program to curb the use of illegal signs while still

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protecting the ability of Realtors® to place real estate directional signs in approved locations. County officials appeared at NVAR’s June 14 Public Policy Forum on signs. At that forum, officials provided the following tips for Realtors® about placing their directional signs. The complete information is available on our website at go.nvar.com/signremoval. Realtors® may also view sign regulations for each Northern Virginia locality on our Sign Regulations page at go.nvar.com/signs.

Signs Enforcement: What You Need to Know Realtors® can play a role in keeping the County attractive for homeowners and potential buyers by adhering to the following: • Off-site directional signs placed Saturday through Monday in the public right-of-way adjacent to

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the road will not be subject to the County’s sign enforcement program. For the purposes of the program, the right-of-way will be considered to extend 12 feet from the edge of the roadway. • Fines for the placement of illegal signs are $100 per sign, with each sign constituting a separate offense. The County will attempt to send warnings to offenders before instituting fines, but be aware that agents in our area have already received fines of up to $1,000 for egregious offenses. • The County is required by law to hold confiscated signs for five days. If your sign has been confiscated and you would like to retrieve it, you may do so at the I-66 Transfer Station on West Ox Road in Fairfax. • Balloons, flags, and other moving parts attached to signs in the right-

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of-way are illegal at all times, as are signs placed in the medians of divided roadways, because they are considered distracting to drivers. • VDOT will respond to citizen complaints about signs in the rightof-way. If they find that the sign is a hazard for drivers, it may be confiscated at any time. • Signs placed in roadways covered by the Adopt-a-Highway program are illegal and subject to confiscation at any time. Fairfax County Code Officials are available to make presentations to area real estate offices and answer questions about the sign enforcement program. For more information, contact the Office of Code Compliance at 703.324.1300. Lisa Vierse May is the NVAR Government Affairs Manager

appraisal forum

Appraisal Best Practices: Legislative and Regulatory Action Provide Guidance By Lisa Vierse May

Appraisal issues are front and center for Realtors® working in today’s rising Northern Virginia market. As a follow-up to the Appraisal Summit held this past May, NVAR’s Government Affairs Department offers tips for agents, plus a look at the current legislative landscape. NVAR, together with the Virginia Association of Realtors® (VAR), worked successfully towards the passage of two pieces of legislation covering appraisal oversight in the Commonwealth. The first of these bills was HB 210 (J. Miller) in 2012. That bill provides that: • Beginning on July 1, 2014, Appraisal Management Companies (AMCs) doing business in Virginia must hold a license from the Virginia Real Estate Appraiser Board, unless the AMCs are currently regulated by the Federal Government; • Appraisers shall include the fee paid to them by the AMC in their appraisal report; • AMCs shall maintain a performance agreement and post a bond or letter of credit to cover any claims made against the AMC by consumers or appraisers; • AMCs shall ensure 12

that their procedures are in compliance with the Federal Truth in Lending Act (TILA) and that appraisals are being conducted in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP); and, • AMCs violating the provisions of the law are subject to enhanced penalties, including fines of up to $10,000 per offense. NVAR and VAR further tightened these regulations in 2013. HB 2222 (Helsel) extends the provisions of HB 210 to cover commercial appraisals.

Federal Issues At the federal level, NAR has been active on appraisal issues for several years, dating back to advocacy efforts on the Dodd-Frank Reform and Consumer Protection Act. In the past year, NAR has also provided guidance to regulators. In February 2012, NAR released its Responsible Valuation Policy (http:// www.realtor.org/appraisal/ responsible-valuationpolicy), which supports and encourages credible, independent valuations of real property. This was followed with testimony before the House Financial Services Committee, Subcommittee

on Insurance, Housing and Community Opportunity. The importance of appraiser competency, business practices of AMCs and providing credible property valuations in changing markets were addressed. In October 2012, NAR sent letters to The Consumer Financial Protection Bureau (CFPB) and other federal agencies. The first of these letters provided feedback about appraisals for higher risk mortgage loans. NAR was successful in exempting rural properties from requirements to conduct multiple appraisals. The second letter offered NAR’s strong support of a proposal to notify borrowers that they are entitled to receive valuation and appraisal reports under the Equal Credit Opportunity Act; that proposal was subsequently enacted into law. NAR continues to work with members of Congress, regulatory agencies and other industry stakeholders to address lingering appraisal issues. In the coming months, NAR will host several educational events and forums on appraisal topics.

Appraisal Tips for Realtors® While your Realtor® associations continue to

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monitor legislative and regulatory solutions, there are several steps that Realtors® can take to improve the appraisal process under current conditions. Before the Appraisal: • Provide as much information in the MLS listing as possible, including photos, virtual tours, descriptions of living areas and the quality of finishes. • Prepare a packet for the appraiser that includes: a list of renovations or improvements and the dates of completion; plats, floor plans, surveys and deeds; Condo and POA packets or other deed restrictions; recent inspections, and neighborhood information. • Use the “Disclosure of ‘Sales Price’ to Appraiser” clause (see Q and A on page 46). • Learn about the appraisal process by taking an introductory course on appraisals or by inviting an appraiser to speak at an office meeting. • Provide information to your clients so that they understand the appraisal process. NAR has a brochure on this topic for download on its Appraisal webpage. RE+VIEW http://go.nvar.com/1304

Appraisals: Realtor ® Resources u National Association of Realtors® Appraisal Information realtor.org/appraisal facebook.com/NARappraisal appraisalinsight.blogs.realtor.org u The National Appraisal Foundation (Appraisal Standards and Qualifications) appraisalfoundation.org u The Appraisal Foundation’s Appraisal Complaint National Hotline refermyappraisalcomplaint.asc.gov u Virginia Real Estate Appraiser Board dpor.virginia.gov/Boards/Appraisers u Uniform Standards of Professional Appraisal Practice (USPAP) uspap.org u Real Estate Valuation Advocacy Association (REVAA) revaa.org

Visit go.nvar.com/ narappraisal. • Get to know your area loan officers’ and lenders’ appraisal and reconsideration processes. During the Appraisal Process: • Ask appraisers about their qualifications, where they are from, how often they work in the area and if they have access to relevant data. If you don’t like the answer, contact the loan officer immediately. Keep in mind, office location and years of experience do not necessarily denote appraiser competency. • Don’t impede the appraisal process by being unresponsive to the appraiser. If the appraiser asks for information, respond promptly. • Be flexible in accommodating the appraiser’s schedule if you want to be present for the appointment. http://go.nvar.com/1304 RE+VIEW

• Give appraisers sufficient time to complete their work. • When providing comparables, make sure that they are recent, preferably within three months, as well as close in location, and similar in size and quality to the listed property. Also, note features that distinguish your property from area comps. • Document differences in tax record data such as square footage. After the Appraisal: • Borrowers may request copies of the completed appraisal report if it is not provided. • If you notice errors or omissions in the report, contact the loan officer immediately. • Be prepared to provide factual information about why the appraisal is inaccurate. Sources: 2013 NVAR Appraisal Summit NAR Appraisal Insight Blog NAR webinar, “Working Productively with Appraisers,” Jan. 12, 2012 July :: August 2013

finance forum

Rules, Regulations and Real Estate Finance: Changes Underway Complying with Dodd-Frank Wall Street Reform Leads to ‘Super-Prime Home Loans’ By Liz Milner

Pundits often speak about economic issues in a way that is divorced from real life. The speakers at NVAR’s May Finance Panel examined the impact the present political gridlock is having on the national economy and on real estate finance.

“This is not your grandparents’ economy” Economics is often referred to as “the dismal science,” and panelist Joseph Minarik pointed out some of the dismal aspects of the Federal Budget dilemma.

Source: Joseph Minarik, Committee for Economic Development

the national debt 1945: 100% of GDP Post - 1945: 33% of GDP 1981: Change in philosophy regarding tax cuts – debt went from 25% to 50% of GDP in 12 years 1993-2000: 33% of GDP 2013: Approaching 100% of GDP

At the end of the war, government spending decreased precipitously, but consumer spending took off. The pent-up demand for consumer goods caused the economy to grow at an unprecedented pace. Today’s situation is not comparable, said Minarik. Factors now are: • High unemployment. The true level is masked by the fact that many are underemployed and some have simply given up and dropped out of the labor force • A large number of jobs lost • A low rate of job creation. We are 14.9 million jobs behind the curve in job creation. • Growing debt. Healthcare costs– mainly Medicare and Medicaid – will increase to 12 -14 percent of the GDP by 2020. The U.S. now has the seventh highest debt burden among all developed countries. A lack of political will is at the heart of the dilemma, according to Minarik, who served as chief economist of the Office of Management and Budget during the Clinton administration. In 2007, the budget deficit was expected to become critical in 15 years. “By choosing not to act, we made the present crisis inevitable,” said Minarik. The bursting of the housing bubble caused a “15-year problem to become an immediate problem.” Moderate members in Congress have declined from 30 percent in 1961 to 5 percent today. Now that voters have become more polarized, gaining the support of the moderates is no longer the key to getting elected. Instead of wooing the center, Minarik believes that today’s politicians court the extremists who shun compromise.

Mortgage, Housing & Dodd-Frank Minarik, senior vice president and director of research at the Committee for Economic Development, a nonprofit, nonpartisan think tank, explained that at the end of WWII, the national debt was 106 percent of the U.S. gross domestic product. (See graph above) A large national debt is not in itself a problem, Minarik said. The differences between our economy today and the economy at the conclusion of World War II are that at the end of World War II we had full employment and high rates of savings. 14

At 2,319 pages, the Dodd-Frank Act of 2010 is a legislative behemoth that members of our industry must comply with or face legal action, said Richard Owen senior vice president of the Virginia Bankers Association and executive director for the Virginia Mortgage Lenders Association. Explaining how federal policy is affecting the home mortgage market, Owen predicted that requirements such as the 804-page Ability to Repay Rule and the 1,100-page Real Estate Settlement Procedures Act (RESPA) and the Truth

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in Lending Act (TILA) will mire banks in paperwork. He suggested that banks will need to hire specialists to interpret the rules and develop standard operating procedures to ensure compliance. Steve Farbstein, chairman of the Virginia Bankers Association Mortgage Executive Group and director of Mortgage Banking for StellarOne Bank, summed up the impact of Dodd-Frank, saying, “what this means for me and my customers is, I’m more expensive, I’m slower and I’m not able to focus on the customer the way I’d like to.”

Minimum Steps Needed to Comply with One New Rule:

Source: Richard Owen, Virginia Bankers Association

“There’s a strict liability standard,” Owen said. “There are safe harbor protections for prime qualified mortgage loans. We only have a rebuttable presumption of compliance if we make loans outside of that box. Most lenders have decided to play it safe and stay within that prime box: 43 percent debt-to-income ratio, points and fees can’t exceed 3 percent of the loan amount, threshold and pricing cannot exceed 1½ percent above the average prime offer rate.” Lenders will have to keep 5 percent “skin in the game” unless they make a Qualified Residential Mortgage (QRM), Owen added. It has all the conservative features of a Qualified Mortgage (QM) plus a maximum debt-to-income ratio of 28 percent, a back-end of 36 percent and a minimum 20 percent down payment. These requirements, which are scheduled to go into effect on January 10, 2014, hurt first-time homebuyers who represent 30 percent of the market, he said. To escape liability, lenders will only do business with clients whose credit ratings are impeccable. “We have gone from subprime to super-prime home loans,” Owen concluded. Liz Milner is a freelance writer in the Washington, D.C. metro area.

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well & septic

Realtors Guide to Well & Septic: Part Two ®

Septic Inspection Procedures keep systems from tanking By S. Michael Lynn

AS established in Part One of this article, published in the May/June 2013 issue of Update magazine, there are no standards or requirements for well and septic inspections in Virginia. What should agents expect? Defining the benchmark for a pass or fail grade is often the most difficult part of the well or septic inspection. The regulatory standards for conventional systems and alternative systems differ. For either system, however, the presence of raw or partially treated sewage on the ground, backing up into the house or contaminating groundwater is a condition for which the health department can take enforcement action. Alternative systems are held to a somewhat higher standard in that the owner is required to have the system operated and maintained by a licensed operator.

Tank Evaluation Some systems have as many as four tanks, and pumping each of those out could cost as much as $1,000. Most inspectors want to ensure that the required inlet and outlet tees, filters and water stops are in place. This requires pumping to a certain degree. Most inspectors also want to look for signs of structural integrity. This requires septic tanks and treatment units to be pumped out in most cases, but pump chambers can usually be evaluated without pumping.

Common Problems and Solutions To allow some room for interpretation by inspectors and negotiation between buyers and sellers, the NVAR Well & Septic Addendum does not define what constitutes a “septic malfunction.” During septic inspections, one approach uses

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three basic benchmarks: Safe, Adequate and Proper. These definitions are derived from a draft policy created by The Virginia Department of Health. Safe: The onsite sewage system is functioning in a forward flow manner and is not currently nor is it expected to adversely affect public health or groundwater supplies, as long as routine maintenance and repairs are carried out. Adequate: The onsite sewage system is sufficiently designed and constructed to account for the sewage flow and strength from the facility. Proper: The local health department has issued an operation permit or other approval for the system, or there is sufficient evidence to suggest that the system was legally installed. These benchmarks can be explained using an automobile analogy. Safe: Based on the inspection results, the inspector is fairly certain that if the car is driven down the road, it’s going to go when the accelerator is pressed, it’s going to stop when the brakes are pressed, and at a normal speed, the engine isn’t going to explode and the wheels aren’t going to fall off. It may need a little bodywork and new tires in a few months or a year, but it’s not going to leave the driver stranded as long as it is maintained.

For an inspector to label a septic system “safe,” the owner should expect to flush the toilet, take a shower and possibly face some maintenance requirements, but in the near future sewage is not likely to come to the surface, contaminate the environment or back up in the house. Adequate: Consumers can’t expect a VW bug to be a reliable commuter car for 10 people in a car pool. Even transporting 10 people in it on an occasional basis is not realistic. Similarly, a six-bedroom house with two kitchens and an in-law suite using a three-bedroom septic system warrants Well & Septic continued on page 18

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well & septic continued from page 17

a closer look. If the homeowners are just a family of four and aren’t going to use the six bedrooms full time, then an inspector might find that the system is adquate. Sometimes agreeing on what constitutes “adequate” is the biggest hurdle for inspectors. Proper: Does a car have a clean title? If taken to DMV, will the owner be able to register it? Was the car produced to U.S. standards, or was it built in someone’s garage? A similar analysis applies when considering whether a septic system warrants a “proper” rating. For an inspector to deem a system “proper,” he or she should be reasonably sure that the system was permitted by the health department, installed by a licensed contractor, inspected and approved. County health departments handle inspections differently, some strictly “by the book,” and others just want the buyers and sellers to be informed about what is being bought or sold. Often, inspectors follow the stricter definitions of Safe, Adequate and Proper when there is an application for a building permit for a deck, pool, addition or garage.

• The inspector doesn’t think the system will return to a normal function if an unoccupied property is re-occupied. In the past, the only option was to add a few lines or install a new system. With the advancement of alternative systems, there are options available that solve the short and long-term problems without a total system replacement: • Adding treatment to help a system recover • Installing new trenches in between failed trenches • Installing a drip system over the top of failed trenches However, some situations will require that the old system be abandoned and a new in-ground or discharge system installed. Cost to Correct? $4,500 to $45,000 The perspective discussed in this article is only one of many. Firms, inspectors and health department officials may have different opinions. Agents should encourage clients to discuss their options with their inspector of choice or the local health department.

Worst-Case Scenario

Mike Lynn is president of SES Mid Atlantic, LLC. He can be reached at mlynn@ses-company.com.

• The system is failing with sewage on the ground • The system is not functioning in a forward flow manner

Editor’s Note: This is part two of a two-part series on Well & Septic. Part one can be found in the May/June issue of Update magazine.

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The Five Most Common Septic Inspection Problems: 1. The number of bedrooms in the house does not match: (a) the number of bedrooms that the septic system is designed to handle; (b) the number of bedrooms that the house is advertised to have; or (c) the number of bedrooms that the tax assessment says the house has. Virginia regulations require that systems be designed for two full-time occupants per bedroom. If there are more bedrooms in the house than the system is designed to accommodate, there are several methods to address the issue. The buyer and seller can agree on the capacity discrepancy and understand the limitations of the system. There may be a method to upgrade the onsite system to match the number of bedrooms. Owners may apply for a conditional operations permit from the local health department acknowledging the discrepancy. • Cost to Resolve: $0 if the parties agree on the discrepancy, up to $10,000 to expand the system to accommodate more bedrooms 2. Risers, lids and covers cracked or leaking: Can be unsafe or can allow groundwater to leak into system causing system to be

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overloaded with water and experience premature failure. • Cost to Repair: $100 - $1,000 to seal leaks in tanks 3. Distribution boxes in disrepair: Cracked lids, boxes not level, deteriorated boxes. These conditions cause uneven distribution of effluent and can cause portions of the drain field to be overloaded. • Cost to repair: $750 to $1,200 per box 4. Root intrusion into distribution boxes and headers. This condition cracks concrete components and blocks lines, causing uneven distribution and/or total blockage of flow. • Cost to Repair: $500 to $3,500 if boxes and headers need to be replaced 5. Header Lines crushed or blocked with sludge. Usually the result of not pumping the tank often enough or heavy use, which causes sludge to be passed out of the septic tank and into the distribution box and headers. • Cost to Repair: $1,200 to jet sludge out, to $3,500 to replace boxes and header lines

July :: August 2013

radon

Radon Mitigation: Is It Needed? Hire Professional Testers to Assess Need By Ryan D. Paris

WHAT IS RADON AND WHERE DOES IT COME FROM? Radon is a naturally occurring radioactive decay product of uranium which is often found in trace amounts in certain types of bedrock. In Virginia, uranium is most often found in native granite and shale. Radon is emitted as a gas and works its way through permeable soil. It potentially can enter the home through any type of foundation – basement, slab or crawl space.

RADON RISK Exposure to high levels of radon gas has long been suspected to dramatically increase a person’s risk of contracting lung cancer. Many scientific studies have concluded that exposure to radon may cause as many as 21,000 cases of lung cancer in the United States each year. It is thought to be the leading cause of lung cancer among victims who have never smoked. The United States Environmental Protection Agency (USEPA) has set an action level of 4.0 picoCuries per liter (pCi/L) for radon in residential air. It is thought that about one of every 15 homes in the country has radon levels that exceed this standard.

WHERE IS RADON IN VIRGINIA? Of Virginia’s 98 counties, 46 have been designated by USEPA as “high risk” for radon in indoor air. Almost every county in the Northern Virginia area has been designated as either high or moderate risk. At least a few elevated radon test results have been found in virtually every Virginia county.

RADON TESTING The ONLY way to know with certainty if radon is a problem in a particular property is to TEST for it. For a real estate transaction, it is always best to hire a professional tester who is trained to follow the proper protocols. The Virginia Code stipulates that professional radon testers or mitigators operating in the Commonwealth must be certified by either the National Radon Safety Board (nrsb.org) or the National Radon Proficiency Program (nrpp.info). Generally, the highest indoor radon levels will be found in the lowest occupied level of the home. If the home has multiple sections and/or different foundation types, the lowest occupied level of each section should be tested. In most homes, the highest indoor radon levels will usually occur in the coldest winter months while the lowest levels usually occur in the summer. Testing during 20

major storms should be avoided. The minimum testing period should be at least 48 continuous hours.

RADON TESTING DEVICES • • • •

Continuous Radon Monitor (CRM) Electret Ion Chamber (E-Perm) Short-term activated charcoal test kits Long-term alpha track test kit

BASIC RADON TESTING PROTOCOL • • • • •

“closed house” conditions test a frequently occupied room avoid exhaust fans (ex. kitchen, bathroom) minimum acceptable distances from wall, floor or windows employ anti-tampering methods

RADON MITIGATION Virtually every home with elevated radon levels can be mitigated successfully. Many mitigators will guarantee that they can reduce the indoor radon levels in most homes to less than 4.0 pCi/L. In many cases, the levels can be reduced to less than 2.0pCi/L, but it is not technically possible to bring the levels down to zero.

RADON IN VIRGINIA REAL ESTATE COURSE: All of the information above is presented in much greater detail in a course that has been specifically designed for Virginia Realtors®. The course has been approved for 2 CE credits and is taught by the Virginia Department of Health Radon Coordinator. Learn more at a special presentation by the author of this article on September 11 at NVAR Herndon.

July :: August 2013

Ryan Paris is a radiation safety specialist and radon coordinator with the Virginia Department of Health, Division of Radiological Health. RE+VIEW http://go.nvar.com/1304

blood drive

NVAR to Host Blood Drive on 7/29: Be a Lifesaver! Every two seconds someone in the U.S. needs blood. More than 1 million new people are diagnosed with cancer each year. Many of them will need blood, sometimes daily, during their chemotherapy treatment. A single car accident victim can require as many as 100 pints of blood. You can help by being a donor at NVAR’s July 29 blood drive. Blood donation is a simple four-step process: registration, medical history and mini-physical, donation and refreshments. Come prepared: Bring your donor card, driver’s license or two other forms of identification. Bring the names of medications you are taking. Eat a good breakfast and be well hydrated!

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Monday, July 29 | 10 a.m. – 4 p.m. | NVAR Fairfax All presenting donors have the chance to win two Baltimore Orioles tickets and to be honored on the field as the BLOOD DONOR OF THE GAME TM! Learn more at go.nvar.com/giveblood.

Every Drop Counts To ask questions or make your life-saving appointment, please email Gerie Kruchko at: gkruchko@nvar.com, or call 703.207.3207.

July :: August 2013

commercial notes

2013 NVAR Thanks Our Partners gold

Realtors® Property Resource (RPR) Provides Value, Metrics and More for Commercial Agents By Frank Dillow

silver

bronze

friend DOMINION Title Corporation

realtors ® seeking a competitive advantage for their commercial clients have a valuable new tool available for their use – free of charge – provided by the National Association of Realtors®. The Realtors® Property Resource (RPR) provides commercial applications for Realtors® in all commercial market sectors. “RPR is a research tool that provides a one-stop spot for comprehensive market information and analysis for properties nationwide,” Emily Line, director of commercial services for RPR, explained to agents attending an NVAR Commercial Council meeting in Fairfax this past May. “It aggregates information from tax assessments and public record information, mortgages and liens, foreclosure data, demographics and census information, consumer spending and lifestyle information and consumer behavior analysis,” she added. RPR can provide in-depth analysis to assist agents when advising their clients. Agents can help clients determine the best business for a particular location, or the best location for a particular business, based on competitive assessments and consumer preferences. “Whether Realtors® are searching for information on commercial or industrial properties, vacant land, lease information, business opportunity analysis, site selection tools, market potential, business analysis or consumer trends and demographic data, RPR is their tool to use,” Line said. “It’s up-todate and easy to use.” She said, “RPR supports our associations in attracting new members by providing them with a tangible product that really improves the value proposition for commercial Realtors®.” Members can access the service by going to narrpr.com, and follow the directions to create your identity for your new, easy login. There is also a 30-minute webinar available every Tuesday to assist Realtors® in using RPR. To register for the webinar, visit blog.narrpr.com/commercial. Line is seeking to keep two-way communication open with commercial Realtors® to ensure feedback so that RPR can continually improve. She has been working with commercial agents in the NAR Commercial Division for the past five years. July :: August 2013

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“RPR is a research tool that provides a one-stop spot for comprehensive market information and analysis for properties nationwide.” Presenter Emily Line was joined by two RPR executives during her visit to NVAR on May 14. Pictured (l – r): Karen France, vice president, RPR training & programs; Emily Line; Frank Dillow, chairman, NVAR Commercial Council; Valerie Rivers, director, RPR training & programs.

Larry Anderson, well known to local Realtors® as an NVAR Realtor® School instructor and former chair of the Commercial Council, will also be providing local instruction to familiarize NVAR members with this platform. “I have been explaining the intangible benefits of NAR membership to our commercial practitioners for

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many years,” Anderson noted, “but they were looking for something more tangible.” “Now they have it,” Anderson said. “The wait is over.” Anderson invites all members to attend the demonstration and training programs. “I can guarantee you will be glad you did.” Frank Dillow is chair of NVAR’s Realtor ® Commercial Council and is a vice president in Long & Foster‘s Commercial Division. He can be reached at francis.dillow@longandfoster.com

July :: August 2013

rent vs. buy

Is It Time to Say Good-‘Buy’ Lease? Analysis of buying vs. renting in the Washington area shows positive equity in as few as three years By David Versel

since the national recession ended in late 2009, real estate and financial professionals have lived by the mantra: “there’s never been a better time to buy.” The argument has gone like this: prices are down, rents are up, there is reasonable inventory and, most of all, mortgage interest rates are historically low. Today, nearly four years into the recovery, a steady flow of sales has eaten into the available inventory in the Washington, D.C. area, driving prices up significantly. The region’s median sale price in April 2013 of $372,600 was its highest since December 2007, though it still remains well below the June 2006 peak level of $426,000. Given the changes in the market, more and more prospective homebuyers will be wondering if they should buy now or continue to rent, hoping that prices will moderate and interest rates will stay low. Many tools are available to consumers to help determine the “payback period” for buying—that is, how many years 24

will a buyer need to own a home before it becomes a better financial deal than renting? Most of these tools are on Realtor® or home builder websites, and thus may be subject to skepticism from those who think that the model favors homeownership. Other neutral parties have created similar tools, though; The New York Times (NYT) has a particularly effective tool available at go.nvar.com/rentvbuy. The George Mason University Center for Regional Analysis used the NYT tool to evaluate the relative merits of renting and buying for the six core jurisdictions of the Washington region: Washington, D.C.; Montgomery County, MD; Prince George’s County, MD; Arlington County, VA; Alexandria City, VA; and Fairfax County, VA. The evaluation considers single-family detached, townhouses, and multi-family units separately, and begins with a comparison of current market-rate sale and rental prices for each jurisdiction and unit type.

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Median Rental and Sale Prices Figure 1.

Source: MRIS; Cassidy Turley; GMU Center for Regional Analysis

Rental rates for multi-family units are an average of closed rentals from MRIS and the reported average asking rent by area for the first quarter of 2013 as reported by Cassidy Turley; all other rates are the median prices for all closed rentals and sales as reported by MRIS. The District of Columbia has the highest median prices for multi-family, for-sale units, $408,500, and for single-family rentals, $3,700. The most expensive rental townhouses are in D.C. and Alexandria, which both have median rental prices of $2,900. Prices in Suburban Maryland were lower than in D.C. or Virginia in terms of both median sale and rental prices, with Prince George’s County having the lowest median levels for all unit and ownership types. Montgomery County has the next lowest prices for all categories, though its medians are only slightly below those in Fairfax County.

Payback Period

These current prices and rents were used as inputs for the NYT model with the goal of determining how many years it would take for buyers to recoup their investments in their homes. The analysis takes into consideration a range of variables, including the amount of money invested as a down payment, annual home value/rent appreciation, closing costs, ongoing maintenance and repair costs, utility subsidies for rentals, and HOA/condo fees. The model also includes other assumptions about the relative costs of owning and renting (see list on page 26). Table 1. YearS when owning becomes preferable to renting Single-Family Detached Townhouse

Multi-Family

District of Columbia

Montgomery County

Prince George’s County

Arlington County

Alexandria City

Fairfax County

Is owning a home really a good investment? Consider these factors: • The amount of savings that needs to be invested as a down payment • The difference in carrying costs between principal, interest, taxes, and insurance (PITI), as well as ongoing repairs and maintenance on an owned property and the lease rate on a rental property • The income tax benefits of writing off mortgage interest • How much rental costs will increase over time • How much property values will appreciate over time.

Source: New York Times, “Is it better to buy or rent?”; GMU Center for Regional Analysis Time to buy, continued on page 26

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rent vs. buy continued from page 25

The payback period is four years for single-family homes in all three Northern Virginia jurisdictions. Assumptions made in NYT model Assumptions incorporated into the model are based on national averages and locally-available data, as follows: • Down payment: 9 percent of purchase price • Mortgage terms: 30-year fixed, 3.54 percent annual interest, no points • Average buyer’s FICO score: 750

Owning a home becomes better financially than renting for all unit types and jurisdictions in the Washington, D.C. area in no more than five years, and in three years or less in most situations. The quickest payback periods are in Suburban Maryland, where home prices are lower. In Prince George’s County ownership pays off in Year 2 for all unit types. Montgomery County has the next fastest payback period, at three years for all unit types. The longest payback periods –five years–are for multi-family units in D.C. or townhouses in Arlington County. The payback period is four years for single-family homes in all three Northern Virginia jurisdictions.

Year 5 Savings from Owning Figure 2.

• Closing costs: 8 percent of purchase price, 3 percent paid by seller • Annual costs as % of purchase price: Maintenance: 0.5 percent; Renovation: 0.5 percent; Insurance: 0.25 percent • Monthly HOA/Condo fees: $400 • Single-family: $160 (40 percent have dues) • Townhouse: $225 (75 percent have dues) • Multi-family: $400 (all have dues) • Annual value appreciation: 3 percent • Annual rent increase: 3 percent • Renters’ insurance cost: 1.32 percent of rent • Landlord-paid utilities: $100/mo

Source: GMU Center for Regional Analysis

Single-family detached homes typically generate the greatest annual savings by Year 5. The highest Year 5 savings amount is for single-family homes in the District of Columbia, $19,654, followed by Prince George’s at $11,743. Alexandria is the exception: the Year 5 savings for a single-family unit is only $6,732, compared with $9,396 for townhouses. Townhouses tend to offer the next greatest savings. The District of Columbia again leads in savings: a buyer of a median-priced townhouse in the District would save $10,867 in Year 5, followed closely by Prince George’s at $9,938. Arlington is the outlier for townhouses—the buyer of a median-priced unit there would only save $2,259 in Year 5, due to its very high median sale price of $685,000. The greatest Year 5 savings from buying a multi-family unit is in Prince George’s County at $6,179, as the county’s median multi-family sales price of $125,000 is by far the lowest in the region. The lowest amount of savings from buying a multi-family unit is found in the District of Columbia at $2,101. July :: August 2013

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Sensitivity Analysis Several key inputs and assumptions were adjusted in order to better understand why payback periods and savings differ by housing type and jurisdiction. Fairfax County was chosen as the model since it has the largest sample size of transactions and its median prices are closest to regional medians. Sensitivity was tested for the following variables: sale price, interest rate, down payment amount, value appreciation over time, and increased HOA/condo fees. Adjusting the down payment amount had virtually no effect on the model, so it is not displayed on the chart. Table 2. Fairfax County Sensitivity Analysis Scenarios Baseline

Prices Up 10%

Prices Up 20%

Prices Up 30%

Int Rate at 5%

Int Rate at 7%

No Value Apprec.

5% Value Apprec.

Assoc Fee Up 25%

Assoc Fee Up 50%

Payback Year Single-Family detached

Townhouse

Multi-Family

Single-Family detached

$7,200

$4,568

$1,937

($695)

$724 ($8,323) ($9,650)

$19,607

$6,666

$6,132

Townhouse

$6,308

$4,570

$2,831

$1,092

$2,029 ($3,949) ($4,825)

$14,506

$5,307

$4,306

Multi-Family

$3,726

$2,560

$1,393

$226

$855 ($3,155) ($3,743)

$10,562

$2,391

$1,056

Year 5 Savings

Source: GMU Center for Regional Analysis

Two variables stand out most: interest rates and value appreciation. If interest rates doubled from their current level to 7 percent, the payback period would triple for all property types and the buyer of a median-price single-family home would lose $8,323 in Year 5 by owning instead of renting. If a home did not appreciate in value at all, the payback period would quadruple, and the Year 5 cost of owning a single-family home relative to renting would be $9,650. The profound effects of having high interest rates or flat value appreciation are obvious, as they both undermine the financial advantages of homeownership. If buyers pay more in mortgage interest and their home values are not increasing, they will be spending more out of pocket each month without generating valueâ&#x20AC;&#x201D;equity â&#x20AC;&#x201D;from their investments.

or the unit type, buying a home in the

Conclusions Potential homebuyers in the Washington, D.C. area have excellent prospects for achieving positive financial returns at this time. No matter the location or the unit type, buying a home in the Washington area will pay off in no more than five years, and in three years or less in most cases. So long as interest rates remain low and home values continue to appreciate, investing in a home will remain a wise financial choice. For those looking to purchase homes, though, access to financing can be a challenge, as lenders have tightened their minimum credit score requirements considerably since 2008. The financial benefits of homeownership are only relevant to those potential buyers who can qualify for a loan. David Versel is a senior research associate with the George Mason University Center for Regional Analysis. http://go.nvar.com/1304 RE+VIEW

No matter the location

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Washington area will pay off in no more than five years, and in three years or less in most cases. 27

ask me

‘Ask Me’ Ambassadors Learn About Our Favorable Local Fundamentals They Share The ‘Fan’Tastic Info with ‘Celebrate Fairfax’ Goers “ASK Me” Ambassadors came to learn about Fairfax County’s successful overtures to create a diverse local economy at the Wed., May 29 Lunch ‘n Learn training session. Catherine Riley, Fairfax County Economic Development Authority’s vice-president of marketing explained her shop’s busy agenda, luring companies to put down roots in our region because of the many advantages our region offers. Among the advantages she cited were: a highly skilled workforce, a nationally ranked school system, a constantly evolving transportation network including access to three airports, a

business-friendly culture and access to government and national markets. Armed with all of the great news about improved consumer confidence and our rising local housing sales and pending sales stats, our “Ask Me” Ambassadors weathered the heat and fanned out among the visitors at the three-day Celebrate Fairfax Fair at the government center June 7-9. Tire kickers were interested in learning more about their buying and selling options, and “Ask Me” Ambassadors spread the message for consumers to “Ask Them” if now is the right time to consider a move.

July :: August 2013

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Veteran “Ask Me” Ambassadors joined those in training (at left) to learn from Catherine Riley of the Fairfax County Economic Development Authority (above) about what the County is doing to court new businesses and opportunities for our region.

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Braving the mid-afternoon heat, Ambassadors (l – r) Tony Rivas of Fairfax Realty, Subodh Prasad of National Realty and Moon Choi of RE/MAX Presidential offered Saturday fair-goers information about homeownership in Northern Virginia.

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Ambassadors (l – r) Mayra Pineda of Fairfax Realty and Gerda Gaetjen and Elaine Guilbert of RE/MAX Allegiance greeted visitors with “Ask Me” fans when the gates opened on Saturday, June 8.

fundraising luncheon

NV/RPAC, RPAC of Virginia Host Fundraising Luncheon for Del. Tag Greason The Northern Virginia Realtors® Political Action Committee teamed with RPAC of Virginia on Tuesday, May 7, to host a fundraising luncheon for Del. Tag Greason (R-32), a strong proponent of real property rights for Northern Virginians. Joining local Realtors® in NVAR’s Fairfax headquarters were members of the local business community.

The May 7 fundraising luncheon for Del. Tag Greason (R-32), hosted by NV/RPAC and RPAC of Virginia, was well-attended by members of the Northern Virginia business community.

Del. Tag Greason speaks with Al Christian, VP of Governmental Affairs at Premium Distributors of Virginia in Chantilly.

July :: August 2013

Del. Tag Greason talks about the legislation he carried during the 2013 session, including a Realtor ® bill to create a first-time homebuyers savings account program in Virginia.

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legal summit 2013

Legal Summit 2013: Avoiding Common Pitfalls

legal summit

Realtors® Guide to Builder Contracts, Renovations, Disclosures and More

2013

By Cameron Hames

NVAR’s second annual Legal Summit, held this past June, offered a full day of learning to the sold-out Fairfax audience. Covered topics ranged from Practicing Across Jurisdictions to Brokerage Office Procedures, and included three hours of CE. Recapped here is a sample of the many program highlights. See page 35 for information about NVAR’s Office Procedures Manual. Video coverage of select sessions will be available through NVAR’s new online school, RazorPath, coming soon to a screen near you.

Common Terms in Builder Contracts As the housing market strengthens, builders’ contracts are becoming more one-sided. Builder negotiation on contract terms is rare when there are multiple buyers interested in one property.

Buyers: Read the Contract; Know the Terms • Customization. Most buyers write in preferences and

specifications in their contracts. However, a builder contract usually allows the builder to make substitutes. If specifications are important to a Buyer, a clause requiring the builder to disclose significant substitutions should be added, including a buyer’s option to cancel the contract if the substitutions are not acceptable. • Warranties. Section 55-70.1 of the Virginia Code provides a solid warranty for new homes, but home buyers often waive that warranty in their contracts. Waivers are required to be conspicuous, generally a two points larger font, so they are easy to identify. The standard warranty is commonly replaced with a third-party warranty covering only specific items. • Deposits or Advanced Payments. Ensure that any required payments are placed in a separate escrow account. Allowing the builder access to the

What needs to be disclosed? • Present facts. If the problem was remedied, that material adverse fact is no longer present and no disclosure needs to be made. • Material facts. A rule of thumb is, any fact that could affect a reasonable buyer’s decision is material and needs to be disclosed. • Adverse facts are stronger than mere defects. • Affecting the property. Even if the problem originates on a neighboring property, such as a neighbor’s faulty water line causing flooding in the subject property’s yard, it must be disclosed.

buyer’s money may leave the buyer empty-handed if the builder encounters financial difficulty. In the worst cases, contractors and suppliers are left unpaid, the buyer’s house is not properly completed and liens are unsatisfied. • Write it Down. Make sure that all important seller representations are written into the contract. Virginia abides by the “four-corner doctrine” of contract law. Any oral agreement between a buyer and builder is not valid. It must be included within the “four corners” of the contract to be a

valid agreement. Builder contracts always contain integration clauses that make the written contract the only binding agreement. The best advice to offer a new-home buyer is for them to seek the counsel of a real estate attorney. While the likelihood of negotiating changes to every aspect of the contract is small, buyers should take steps to include the preferences that are important to them. At the very least, buyers should include language making the contract contingent upon final attorney review. Legal Summit continued on page 32

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continued from page 31

Unpermitted Renovations: What Every Agent and Seller Should Know Permits are required by law, and are needed to protect homeowners and their investments. This was the message shared by the Arlington County Zoning Department and The Fairfax County Permit Office.

Did You Know? It is common knowledge that permits are required for major renovations, expansions, building of decks, finishing a basement and demolition before starting those projects. What many donâ&#x20AC;&#x2122;t realize is that a homeowner replacing a gas appliance needs a permit and an inspection. It is a rule

that is often overlooked. The same holds true for relocating electrical appliances. However, for simple replacement of an electrical appliance, a permit is not required.

The Permit Process A good contractor will know the proper procedures and take the required steps. Contractors who apply for permits on behalf of their customers indicate that they take full responsibility for the workmanship. Enforcement actions against a contractor become difficult when the permit is issued directly to a homeowner. To verify if a contractor is properly licensed under state and local laws, consumers can check online at: dpor.virginia. gov/LicenseLookup or call 804.367.8500.

Fairfax County allows individuals to check and apply for permits online at fairfaxcounty.gov/fido. The county has online records dating back to 1981. For the unfortunate homeowner who discovers that renovations were made without permits, there are options. The homeowner can still apply for permits through the appropriate channels. All renovations would have to meet the current Virginia Code in order for a permit to be issued. Additionally, homeowners can purchase enhanced title insurance to alleviate costs up to $25,000 that are incurred as a result of unpermitted renovations.

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Identifying Zoning Problems A rule of thumb for agents evaluating a property for listing is that they should be able to move from the bottom floor to the top floor of a structure without encountering any restrictions. The need to open a door is not considered a restriction, but if sections of the home are partitioned off, requiring separate entrances, that is a cause for concern. When an agent encounters this type of restriction, it should be a red flag that the building may not be zoned for that use. It is at the agentâ&#x20AC;&#x2122;s discretion whether to take any action at that point or whether to take the listing. Contacting the appropriate zoning authority is the first recommended step.

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Disclosures Shall Set You Free Agents often struggle with the required disclosures when listing a property. Attorney Blake Hegeman, legal counsel for VAR, presented some common disclosure issues raised by agents. The Agent must disclose present material adverse facts pertaining to the physical condition of the property that are known or should be known by a reasonable person. Agents do have a heightened duty compared to their sellers regarding disclosures. However, agents are not under a duty to discover present material adverse facts. Facts that must be disclosed are those

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that agents have actual knowledge of or should have actual knowledge of. Also, any attempt to conceal a present material adverse fact from the buyer, such as installing a fake wall to prevent a buyer from seeing a mold problem, may result in a fraud claim against the seller.

Stigmatized Properties A seller does not need to disclose that the property was the scene of a murder, suicide, or the like. The fact could be material to the buyer, but it does not have any present adverse effect on the property.

Distressed Properties When a property is sold as an REO or foreclosure, the disclosure requirements

are minimized. REO sales are subject to the Lead-Based Paint Disclosure Act and require the presentation of the Property Ownerâ&#x20AC;&#x2122;s Association disclosure packet or condominium resale certificate, if applicable. However, an REO sale is not subject to the Residential Property Disclosure Statement Act and thus, the corresponding disclosures are not required. If the property is sold at foreclosure, none of the aforementioned disclosures are required.

Disclosure Method

the buyer in writing. Hegeman recommends that agents always present disclosures prior to ratification. If the Residential Property Disclosure Statement is presented after contract formation, the buyer receives a three day (five days, if mailed) termination period. This period allows the buyer to end the contract at any time within that window without justification. Following these recommendations can help ensure a stress-free transaction for buyers, sellers and their respective agents.

There is no required method of delivery for disclosures, but it is always recommended that disclosures be presented to

Cameron Hames is a law clerk for NVAR. He is a second-year law student at George Mason University School of Law

July :: August 2013

form changes

NVAR Form Changes: Effective July 1 By Laura M. Farley

ON July 1, a number of NVAR form changes became effective. A summary of substantive changes is included below. A complete list of forms and revisions can be found on the NVAR website at go.nvar.com/2013forms. Forms changing July 1, 2013:

K1008 – Rental Application The last sentence of the first paragraph under the Conditions Paragraph was modified to say “Funds held by an escrow agent will be deposited no later than 5 business banking days after the application has been approved.” This change and other conforming changes were made to comply with a new law.

NVAR’s Realtor® Shop is also ONLINE. Shop now 

K1024 – Request for Condominium Disclosure K1025 – Purchaser’s Acknowledgment of Receipt of Condominium Disclosure K1126 – Purchaser’s Acknowledgment of Receipt of Property Owners’ Association Disclosure Packet K1299 – Request for Property Owners’ Association Disclosure Packet These four forms were updated with two new items, numbers 17 & 18, which were added to the list of items that should be included in the disclosure packet, under new law. The disclosure packets should now include a statement indicating any known project approvals currently in effect

Shop

RealtorShop.com

Your one-stop-shop for real estate business products & accessories, 24/7. NVAR Members Only

Coupon redeemable toward any purchase made at the NVAR Realtor® Shop. Non-transferable. No cash value. Cannot be combined with any other vouchers or coupons, or used on sale items. Cannot be used on SentriLock items.

IN-STORE PURCHASES ONLY. VALID THRU 9/15/2013

Or visit our convenient locations: NVAR Fairfax Headquarters 8407 Pennell Street Fairfax, VA 22031

Herndon Service Center 520 Huntmar Park Drive Herndon, VA 20170 July :: August 2013

Save 15%

OPEN HOUSE REGISTRIES & REFILLS (includes D4019, D4048 and D4146)

www.RealtorShop.com Store: 703.207.3215

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Brokers: Office Procedures Matter!

The Department of Professional and Occupational Regulation (DPOR) requires all real estate brokers to have an “office procedures manual” available at their office. To better serve our members, NVAR offers a suggested manual for download on nvar.com under the law & ethics tab. Questions? Submit them through NVAR’s Legal Hotline at go.nvar.com/legalhotline.

issued by secondary mortgage market agencies and also any restrictions concerning the size, place and manner of placement of solar energy collection devices on individual properties.

K1306 – Escalation Addendum Wording changes were made to clarify the original intent of the committee that the final escalated sales price would be based on the ‘net’ to the seller in all instances. The previous version of the form created confusion as to whether seller subsidies were taken into consideration when selecting the maximum amount of the other offer to escalate beyond. Further, the form now takes into account that the seller

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may not be the final party ratifying an offer due to the possibility of counteroffers submitted during negotiations.

K1307 – Seller’s Estimated Costs of Settlement K1345 – Virginia Jurisdictional Addendum Both forms were updated to reflect the new Regional Congestion Relief Fee which was passed in Virginia. Under the new law, if the property is in a designated Planning District sellers must pay a new fee of $1.50 per $1,000 of Sales Price or assessed value, whichever is greater. Currently, properties in Arlington, Fairfax,

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Loudoun and Prince William counties and any cities located within these counties will be subject to this new fee on July 1, 2013. A new line item was added to K1307, while the Additional Fees Paragraph of K1345 was updated to include reference to the new fee.

K1343 – Home Inspection Removal The form was amended with language to clarify what must be included with the Removal Addendum, and to allow for the Purchaser to request cash or other remedies beyond repairs. Laura Farley is a staff attorney at NVAR.

multi-million $ awards program

Top First-Time Realtors and Milestone Winners Honored at Multi-Million Dollar Awards Breakfast ®

Recognizing 2012 Sales Accomplishments Last year, 920 NVAR members qualified for entry into the Multi-Million Dollar Awards Program. Of those, many were First Timers or celebrating their 5th, 10th, 15th, 20th, 25th, 30th and 35th anniversaries for work completed in 2012. Those winners were honored, along with their brokers and program sponsors, at the May 1 breakfast event at the Falls Church Fairview Park Marriott. To view the 2012 awards club members, visit go.nvar.com/mdsc. NVAR awards recognize members who have closed at least $3,000,000 in gross sales or 24 transactions during an award year. Top Producer honors are awarded when the member doubles the minimum qualification sales total requirements.

Weichert broker Jill Croft (l) enjoys prebreakfast coffee and conversation with five-year honoree Gene Mechling of Prudential PenFed.

Having a record-breaking 2013? Get the recognition you deserve. Look for 2013 award program applications in December on nvar.com and in our Nov/Dec RE+VIEW.

Twenty-five year honoree Mary Wharton of Long & Foster (l) is congratulated for her years of success by Prudential PenFed brokers Kathie and Dave Eaton. NVAR Chairman Jon Wolford (l) joins broker Susan Oh of New Star Realty (2nd to l), who accompanies her first-timer agents Joanne Na and Michael Shin.

Five-Year honorees assemble following the awards breakfast. Pictured (l – r): Lois McCormick of Weichert; Linda Bilotti of RE/MAX Allegiance; Heather Embrey of McEnearney Associates; Catherine Parker of Long & Foster; Dallison Veach of RE/MAX Allegiance; Cinnamon Pham of Top Team Realtors®; and James Agnew of Avery-Hess.

Avery-Hess agents Nina Landes (l) and Christine Brown celebrate their first year milestone at the Multi-Million Dollar Awards Program. Life Member honorees celebrate 10 cumulative years of membership in the Multi-Million Dollar Awards Program. Pictured (l – r): Cindy Clemmer of McEnearney Associates; Jill Hanig of Prudential PenFed; Joyce Becker of Weichert; and Charlie Rose of Long & Foster. 36

Attending the Multi-Million Dollar Awards breakfast to honor their colleagues and agents are (l –r): broker Michelle Forbes of Long & Foster; board members Lorraine Arora of Long & Foster and Christine Richardson of Weichert; and NVAR CEO Christine Todd. July :: August 2013

RE+VIEW http://go.nvar.com/1304

education news

Virginia Post-Licensing Requirements Are Changing! AS you know, if you are a newly-licensed agent you must complete 30 hours of Post-Licensing education within one year of becoming licensed. DPOR is changing the Post-Licensing curriculum. The curriculum changes will affect you if: 1. You are a new licensee, and 2. You have not yet completed your 30 hours of PL education. To determine your licensure status, visit the DPOR license lookup website at dpor.virginia.gov/LicenseLookup.

Here’s what else you need to know: • Effective January 1, 2014, a new single-track PL system will be in place. • Licensees may not mix hours from the current three-track system with hours from the new one-track system. All 30 hours must be completed under the old system or the new system. • New licensees who have not completed all 30 of their PL hours prior to December 31, 2013 will need to completely

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start over to accumulate their PL credits under the new curriculum in 2014. • DPOR began to accept credits from the new single-track system beginning July 1, 2013. NVAR plans to start offering the single-track system in the fall of 2013. • New licensees still must complete their 30-hour PL requirement within one year of licensure. Bottom Line: No mixing of old curriculum with new curriculum. Know your one-year deadline! Questions: Contact education@nvar.com or 703.207.3244.

July :: August 2013

membership news

NVAR Brokerage Transfer Form At NVAR, we share important information with our members via email and the RE+VIEW magazine. It is critical that we have each member’s correct contact information. All members now have the ability to change their own password and edit personal information in the NVAR database. Effective this past May, NVAR members are responsible for maintaining, and therefore keeping current, their own personal information. This will ensure that the most up-to-date information is in the NVAR system. To reflect this capability, the NVAR Member Change Form has been amended. The personal information update section has been omitted, and the form has been renamed the NVAR Brokerage Transfer Form. It is only to be used by members to change brokerages or to terminate membership (change to Inactive or Referral Status). To access and edit membership information, follow these simple steps: • Go to nvar.com and login with your NRDS ID and password by clicking on “Please click here to login” in the upper righthand corner ( if you can’t remember, click on “Forgot NRDS ID or Password” and the information will be emailed to you) • Click on “Edit Membership Info” Questions? Contact Member Services at membership@nvar. com or 703.207.3256.

Committee Opportunities: Apply by August 30! Help to Ensure Industry Professionalism Members interested in joining NVAR’s 2014 Standard Forms Committee, Grievance Committee, Professional Standards Committee or Arbitration Committee, please contact Laura Farley at lfarley@nvar.com. Interest forms for these four committees, available at go.nvar.com/CommitteeForm, are due by August 30. To learn more about these and other NVAR volunteer opportunities, please visit go.nvar.com/committees. Interest forms for other 2014 NVAR committees will be available later this year.

Good News! Transferring from One Brokerage to Another is now Easier DPOR approved a streamlined transfer process that allows a licensee to start at a new firm the day the agent and new broker sign and submit an application. The new transfer process requires the following: 1. The new broker must affirm that the transferring agent’s license is active. That can be done by entering the agent’s name at dpor.virginia.gov/LicenseLookup. 2. The new broker must agree to assume supervisory responsibility, on the date the new broker signs the transfer application. 3. The transferring licensee, by signing the application, certifies that the former brokerage has been notified of his or her departure. Submission of the application and fee must occur immediately, and the application must be fully completed to avoid delays. Learn more at dpor.virginia.gov/Boards/Real-Estate.

New Property Tax Rates Effective July 1, 2013 Residential real estate property taxes changed for many Northern Virginia homeowners on July 1. Below is a list of current tax rates for local jurisdictions.

FY 2013-2014 Residential Real Estate Tax Rates All rates are per $100 of assessed value City of Alexandria............................... $1.038 Arlington County................................. $1.006 Town of Clifton.................................... * City of Fairfax...................................... $1.06 Fairfax County..................................... $1.085 City of Falls Church............................. $1.305 Town of Herndon................................. $0.265 + Fairfax County Tax Loudoun County.................................. $1.205 Prince William County........................ $1.181 Town of Vienna................................... $0.2288 + Fairfax County tax Commercial Property Tax – Transportation Surcharge These amounts are in addition to the general tax rate above Arlington County................................. $0.125 City of Fairfax...................................... $0.055 Fairfax County..................................... $0.125 *unavailable at press time; visit clifton-va.com

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RE+VIEW http://go.nvar.com/1304

new members

Welcome New Members

LeaRn more at go.nvar.com/benefits.

Stop by Fairfax or Herndon to pick up the new Member Services Guide! Sherif Abdalla Sandra Abrego Omolara Adeosun Rodolfo Aguilar Dipika Ahluwalia Mohammed Ahmed Rula Al Minawi Barbara Alexander Michael Alexander, Jr. Eugene Allamby LaToya Anderson James Andors Sonya Anyanwu Brian Ashton William Asrat Aaquil Atkins Troy Ayala Nizar Baaguig Kiya Badrpay Nancy Baker Melissa Barkalow Hernan Barrero Ebony Bates Enkhjargal Batsuuri Robert Bell Nancy Betz Aloysious Bigirwa Anne Blakeman Glenford Blanc Jessica Blanchette Daniel Bostwick Christopher Bramhall Serena Brown Ricardo Brun Eugene Bull Kenneth Burris Robert Butler Carlos Carrillo Danette Chaffee Elaine Chamberlain Bart Chamberlin Bradshaw Chamberlin Justin Chaney Daosadet Chanthapanya Christopher Chapin Jimmy Chavez Lu Chaw Zhiping Chen Rajesh Cheruku Jason Chesky Danny Choi Sandra Chorney Yousuf Choudhry Guneit Chowdhary Magally Christian-Chacon Catherine ChristieWoodson Chiu-Chu Chung Jayalakshmi Coimbatore Anthony Coleman Lori Connelly-DeFranco Maureen Cooney Larry Napoleon Cooper Therese Costigan Christopher Craddock Wynn Creasy Bernalyn Crisostomo Fred Cronkhite Catherine Crosby Chris Cunningham Lindsay Cureton Lorin Curit James Dameron Kathryn Davis Kay De Giorgi Tamara De Souza Paul DeAntona Michael DeCarlo Cristian Del Cid

Roya Delaney Alan Dillon Jeffrey Dindlebeck Feng Ding Douglas Dixon Eileen Dolan Angelita Domingo Frank Donnelly Patrick Drago Robert D’Souza Jacquelyn Eastman Jennifer Edison Jennifer Eid Anne Ellery Ahmed Es-Haq Jennifer Ewell Morteza Farshchi Kristina Felten Wallace Felts Brenda Fisher Jennifer Flook Philip French Vicki Frenk Jerome Friedlander Jennifer Fuchs Irma Garcia Kenneth Garfinkel Michael Garrell Tara Garrison David Gates Akram Ghandchilar Maria Gildea Robert Giles Carol Ginsberg Susan Giordano Magdalena Gonzalez Russell Gorrell Nicole Goss Kristina Gottschalk Janet Graham Elaine Gray Shonta Greenwood Jill Griffith Liyan Gu Hanif Guliwala Anish Gupta Huong Ha Abraham Habte Chaika Hale Adele Halterman Ayman Hamed Nancy Hammond Kyle Hanger Joellen Hartke Lawrence Haskell James Hastings Ellen Heather James Heslep Norbert Heubusch Julian Ho Wendy Holcomb Gregory Holman Christine Hopkins Mary Horvath Nicholas Hsu Timothy Hunt Ellen Hunt Scott Isley Vibha Jasani Kristine Jefferson Ralph Jewell Aaronia Jones Gursen Joseph Raghavender Joshi Connie Judge Solamite Kapaldo Daniel Kauffman Nazneen Kavarana Aria Kavyani

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Smita Khalid Anjum Khalil Rab Khan Richard Kicklighter Stephen Kilroy Yeri Kim Sheryl Kim James Kinder Kathleen Kingsley Douglas Kinkoph Diana Kirtley Clair Ko Brian Ko Mikhail Kolyadov Patience Kplivi William Krueger James Larsen Stephen Laurenson Tralina Lawrence Charlotte Lawrence James Lawson Lisa Lease Young Kyong Lee Dennis Lee Brett Lieberman Jennifer Lieberman Edwin Loureiro Heidi Luu Christine Lyons Xiaoxiao Ma Alexandra Mak Elsa Marquina Margaret Marsh Miguel Martinez Cristina Martinez David Mason Randa Masri Cynthia May Nora McArdle Allison McBane Crystall McCall Constance McDonald Michael McGeever,Jr Daniel McKim Ankit Mehta Melvyn Mendez Michaela Mendez Dina Mendoza Monica Menjivar Nerene Merlino Lee Ann Miller Jessy Milner Harry Minj Dinah Montgomery Laurie Moore Anthony Morra Michael Mortensen Douglas Mose Richard Mountjoy, Jr. Bernie Moyer Jordan Muirhead Robin Murphy Eva Nahid Corazon Narciso Molina Ashley Nazari Danielle Nelson Tasha Nelson Janine Newman Peter Nguyen Robert Nirschl Cynthia Nocente Michael Ober Kimberly Obermeyer Jason Oliver Makenzie Olving Brian O’Malie Sochandara Or Henry Park Anahita Parsapour

Nancy Perkins Richard Phillips Colleen Pinto Gay Pirozzi Anthony Pitrelli Joshua Potts, Sr. Dennis Poulsen Shannon Pressley James Pumphrey Keshav Raghunathan Jennifer Raines Stephanie Rall Vivek Reddy Russell Reiter Sara Rieckewald Rawiah Rizk Heidi Robbins O’Ranti Robinson Annette Robinson Robert Rocheford Diana Rock Penelope Rogerson Manpreet Rohatgi Kelly Roth Charles Roundtree Ana Ruiz Julie Ruleman George Russell Laurie Russo John Ryan Areizo Said Jose Salazar Silva Kelly Samson Sandeep Sandhu Reena Sanjiv

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Paul Schaaf Mary Schmitz Bridget Schmitz Debbie Schneider Jason Secrest Leila Sendjak Norwood Seema Shah Dave Sharma Ronald Shatkowski Wayne Sienkiewicz Eric Sillery Maria Silva Sasha Simanich Rima Sinno Oksana Skidan Jennifer Smith William Smith Mary Smith Donald Smyles Kelly Snell Joseph Sofi Byung Soh Veronica Spicer Floyd Stansfield Rebecca Straley Seung Kuk Tak Mylene Talavera Joel Tamakloe Preeta Tanavade Christina Tates Ravinder Thakral Gregory Tomlin, II Maritania Torres Douglas Turley Carmellita Turner

Thomas Turrisi James Turtora Scott Twentyman Rachel Van Zanten Yunia Velasquez Alexandra Vera Margaret Veroneau Joyce Wadle Jason Walker Charles Waltjen Joan Warden Joseph Washington Rhiannon Weitzman Natalie Wiggins Lisa Wijaya Jason Williams Margaret Winkler Soroya Winstead Kevin Wolfe Cheryl Wu Robin Wulff Michael Yalove Lijun Yang David Yee William Yu Ahmet Yusufhanoglu Firoza Zafar Dana Zalowski Badar Zaman Angelica Zambrana Rojas Roberto Zani Guoying Zhang Carolyn Zok

class schedules

Onsite

Onsite Pre-Licensing Education

Post-Licensing Education (PL)

Principles of Real Estate: Day 1-9 Time: 9 a.m. – 5 p.m. Date/Location: November 4–14, Fairfax

New member orientation Time: 9 a.m. – 4 p.m. Date/Location: July 27, Fairfax August 2, Fairfax August 24, Herndon September 13, Herndon

Principles Exam Prep Course Time: 9 a.m. – 4:30 p.m. Date/Location: November 15, Fairfax

Onsite

D.C. Continuing Education (CE) D.C. Fair Housing and D.C. Financing Issues Time: 9 a.m. - 4:15 p.m. Date/Location: July 16, Fairfax September 17, Fairfax D.C. Fair Housing and D.C. Legislative Update Time: 9 a.m. – 4:15 p.m. Date/Location: August 20, Fairfax

Post Licensing (Day 1) - What’s In a Contract and Real Estate & Contract Law Time: 9 a.m. – 4 p.m. Date/Location: July 22, Fairfax September 16, Herndon Post Licensing Time: Date/Location:

(Day 2) - Agency Law & Ethics 9 a.m. – 4 p.m. July 23, Fairfax September 17, Herndon

Post Licensing (Day 3) - Fair Housing & Escrows Time: 9 a.m. – 4 p.m. Date/Location: July 24, Fairfax Post Licensing (Day 3) - Fair Housing & Business Planning Time: 9 a.m. – 4 p.m. Date/Location: September 18, Herndon Post Licensing (Day 4) - Listing Property and Working with Sellers Time: 1 – 5 p.m. Date/Location: July 25, Fairfax September 19, Herndon Post Licensing (Day 5) - Working with Buyer Clients and Marketing with Technology Time: 8:45 a.m. – 4:45 p.m. Date/Location: July 26, Fairfax September 20, Herndon

Onsite Residential Standard Agency (RSA Course) Residential Standard Agency (RSA course) Time: 9 a.m. – noon Date/Location: August 21, Fairfax Time: Date/Location:

1 – 4 p.m. July 30, Fairfax August 6, Herndon September 10, Fairfax

To register for a course listed or view a class description, visit RealtorSchool.com 40

July :: August 2013

RE+VIEW http://go.nvar.com/1304

Onsite continuing Education (CE) 16 Hr CE Time: Date/Location:

Onsite Technology Technology Brown Bag Lunch n’ Learn: Do It Yourself Real Estate Photography Tips Time: 12 – 2 p.m. Date/Location: July 10, Fairfax September 11, Herndon

8:45 a.m. – 4:45 p.m. July 13, Fairfax – Day 1 July 20, Fairfax – Day 2 August 10, Herndon – Day 1 August 17, Herndon – Day 2 September 14, Fairfax – Day 1 September 21, Fairfax – Day 2

Technology Brown Bag Lunch n’ Learn: Open Houses Online and In-Person Time: 12 – 2 p.m. Date/Location: August 14, Fairfax

16 Hr CE - Evening Time: 6 - 9:30 p.m. Date/Location: July 9, Herndon – Part 1A July 11, Herndon – Part 1B July 16, Herndon – Part 2A July 18, Herndon – Part 2B August 6, Fairfax – Part 1A August 8, Fairfax – Part 1B August 13, Fairfax – Part 2A August 15, Fairfax – Part 2B September 10, Herndon – Part 1A September 12, Herndon – Part 1B September 17, Herndon – Part 2A September 19, Herndon – Part 2B

Onsite desigNations and Special Offerings Senior Real Estate Specialist (SRES) Time: 8 a.m. - 4 p.m. Date/Location: September 9, Fairfax – GRI 404: The Cyber-Realtor® Time: 9 a.m. – 5 p.m. Date/Location: September 23, Herndon – ABR Designation Course - Day 1 September 24, Herndon – ABR Designation Course - Day 2 September 25, Herndon – SFR Certification Course

Broker CE Time: 8:45 a.m. – 12:25 p.m. Date/Location: July 17, Fairfax – Brokerage Risk and Liability

August 7, Fairfax – Brokerage Risk and Liability

ONSITE SPECIAL Time: Date/Location: Time: Date/Location: Time: Date/Location: Time: Date/Location:

Time: 1 – 4:45 p.m. Date/Location: July 17, Fairfax – Productive Agents and Offices CE Time: Date/Location:

August 6, Fairfax – Productive Agents and Offices

8:45 a.m. – 4:45 p.m. July 23, Herndon – 8 Hr Course August 28, August – 8 Hr Course September 5, Herndon – 8 Hr Course

Time: 8:45 a.m. – 12:25 p.m. Date/Location: August 28, Fairfax – Agency & Disclosure Under VA Agency Law August 24, Herndon – The New Rules of Real Estate Finance

September 9, Herndon – Detection & Prevention of Contract Fraud

Time: 1 – 4:45 p.m. Date/Location: July 24, Herndon – Buyer Beware: Foreclosure, Vacant & Neglected Properties

OFFERINGS 9 a.m. – noon August 8, Fairfax – Rules & Tools of Advertising - Part I 9 a.m. – noon August 15, Fairfax – Rules & Tools of Advertising - Part II 1 - 4 p.m. September 18, Herndon – Conquering Contracts - Part A 1 - 4 p.m. September 24, Herndon – Conquering Contracts - Part B

Fairfax HQ Accessibility:

August 28, Fairfax – Green Building

September 6, Herndon – The New Rules of Real Estate Finance

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July :: August 2013

Underground parking is available with direct access to lower level classrooms. Elevator is available, accessible from main entrance on building’s west side.

public policy forum

Town Hall Explores the Future of Route 1 Delegate Scott Surovell Discusses Corridor Development with NVAR Members On Thursday, June 6, Delegate Scott Surovell (D-Mt. Vernon) hosted area Realtors® at the Mount Vernon District Government Center. He outlined changes coming to the area, including transportation, redevelopment, and public schools. The meeting with Del. Surovell was the first in a series of Town Hall events that the NVAR Government Affairs program will schedule this year with area elected officials. Stay tuned for future dates and topics!

Transportation

As a result of funding secured by Del. Surovell in the Commonwealth’s FY 2013-2014 budget, the Department of Rail and Public Transportation will conduct a study of transit alternatives for a 14-mile segment of Rt. 1. This study will include options for Metrorail, bus rapid transit and light rail. The outcome will also address proposed beautification projects for the Rt. 1 rights of way. Del. Surovell noted that the inclusion of transit in the corridor could serve as a “game changer” for the area by drawing additional commercial investments, spurring redevelopment, and attracting new residents. Two Mt. Vernon-area road projects are coming soon: • Mulligan Road project. Slated for completion in one year, this will serve as an additional connection between Rt. 1 and Telegraph Road in the area of current Old Mill Road and Mt. Vernon Memorial Highway. The endpoint of the new Mulligan Road at Telegraph is slated to be this region’s newest Wegmans store. • Improvements on Rt. 1 near Fort Belvoir. The road alignment and contractor have been selected, with estimated project completion in 2016. Still to be determined are a future location for the equestrian uses at Woodlawn Stables, and future uses for the remaining Woodlawn Plantation parcels fronting Rt. 1 and Mt. Vernon Highway.

Schools

The Mt. Vernon area has undergone a demographic shift in recent years, as retirees have moved out and families with children have moved in. As one of the faster growing areas in Fairfax County, this creates challenges for local schools. West Potomac High School is exceeding capacity, which has prompted talks of a boundary study. Planned improvements include a new elementary school, substantial renovations to many of the existing elementary schools, and athletic field improvements.

Redevelopment Huntington Metrorail Station: • The conversion of the VSE Office Building site (northwest of the station) to a mixed use development • Conversion of the Huntington Club Condominiums (to the immediate west of the station) • The construction of an additional 125-unit residential building at the former Belle Haven Towers property. South on Rt.1: • The Penn Daw shopping center at the intersection of North Kings Highway, South Kings Highway and Rt. 1 will be converted into residential units with first floor retail • Property adjacent to Tully Gate at Ft. Belvoir, to be named the Village of Accotink • The current Fairview Motel • The North Hill site near Popkins Lane • The Mt. Vernon Gateway area between Buckman Rd. and Janna Lee Ave. Attendees discussed the lack of visible retail moving into existing mixed-use developments like the Beacon of Groveton. Del. Surovell explained that retail leases often follow tenant move-in. Refuting a perception of a lack of demand for additional restaurants and retail, Del. Surovell noted that transportation challenges and the location between Huntley Meadows and Ft. Belvoir were preventing potential investors from seeing their target numbers. He believes that there is opportunity and growth potential, given the area’s relatively affordable housing and short distance to other major business hubs. View Del. Surovell’s presentation at go.nvar.com/coffee.

Links to these Additional Resources: go.nvar.com/rt1townhall VDOT: Mulligan Road/Jeff Todd Way Project Information Virginia Department of Rail and Public Transportation, Rt. 1 Multimodal Study Page Mt. Vernon District Visioning Task Force Report Penn Daw Redevelopment Study BRAC Area Plans Review South County Area Plans Review Fairfax County Schools: Capital Improvement Program Fairfax County Schools: Boundary Planning Contact information for: Del. Scott Surovell Sen. Toddy Puller Supervisor Gerry Hyland Lisa Vierse May is the NVAR Government Affairs Manager

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RE+VIEW http://go.nvar.com/1304

nv/rpac 2013 contributors

2013 NV/RPAC Contributors List (June 19, 2013)

We’re getting there, thanks to you John McEnearney NVAR

Shane McCullar Roger Nakazawa Jason Outten

Robert Adamson Julia Avent Mary Bayat Patricia Buck Robyn Burdett David Charron Moon Choi Tracy Comstock Virgil Frizzell Suzanne Granoski Delk Hamaker Todd Hetherington Jo Anne Johnson Sita Kapur Karen Kidwell Patricia Kline Susan Mekenney Thomas Meyer Vinh Nguyen Susan Oh Tracy Pless Anne Rector Peter Rickert Zinta Rodgers-Rickert Fetneh Schacht Thomas Stevens Derrick Swaak Christine Todd Jon Wolford

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William Amery Candice Bower Sue Chong BichLan DeCaro Heather Embrey David Howell Nicholas Lagos Kevin Lee Christina O’Donnell Mary O’Gorman Sherry Rahnama Christine Richardson Mario Rubio Veronica Seva-Gonzalez Trudy Severa Kristin Stone

Larry Anderson Cathy Baumbusch Russell Boyle Dianna Campagna Gwendalyn Cody Dan Daniels Florence Daniels Paul DiCicco Laura Fall Lisa Goodfriend Doris Houston Guo Michael Huang Gye Shil Kim Cindy Lancaster Lisa Langlais William Laughlin Susan Leavitt Natalie McArtor McEnearney & Associates Marty Merriam Rebecca Owen Sarah Petcher Andrea Pierobon Audrey Shay Nancy Steorts Patricia Szego

LaSonya Abney Jean Abood Fana Abraha Peter Afflu Rafael Aguilera Barry Allbright Are Andresen Kannan Annamalai Mary Anthony Lorraine Arora Gay Ashley Judy Austin Carlo Baietti Thomas Baker Vijay Balusu Barbara Bechtle Ann Beck James Bell Thomas Bellanca Johanna Bendfeldt Charles Bengel Edward Berenbaum David Bilups Carolyn Boaz Phil Bolin Jessie Braudaway Joan Bready Michael Briggs Jeanne Brown Karrina Brown William Buck Shirley Buford Tuyet Ngoc Bui Toni Burger Christopher Call Miguel Calvo Paul Challis Jan Chang Louis Cironi Candyce Clanton Christopher Copeland Georgianna Copelotti Deborah Corbatto Barbara Costa Janet Croft Lois Delaney Jenny Dewenter Maureen Dunn Kathleen Eaton Anna Edwards Samer Elkasm Stephanie Ellis Patricia Evers Robert Ferguson Miriam Fernandez Larry Foster James Fox Paul Gale Reinier Giesberts Deborah Gill John Glorioso Brandon Green Sylvia Haefer-Rose Donna Hamaker Rebecca Hanrahan

July :: August 2013

Melinda Hanson Anne Harrington Marye Jo Hartley David Hawkins Barbara Hendrickson Ruth HenriquezCampos Janet Hewitt Joseph Himali Margaret Ireland Subbarayudu Jakkampudi Matt Kahn Charles Kim Lauren Kivlighan Brian Klotz Robert Koenig Rolfe Kratz Charles Kunstbeck Frank Lackman Dana Landry Jill Landsman Anita Lasanksy William Lauler Diane Lee Sherri Lee Francis Lee Ashley Leigh Diane Lenahan Glenn Lewis Sonni Lieberman Lisa Lieu Thierry Liverman Scott MacDonald Ann Malcom Ali Mansouri Charles Martin Thomas Mazzei Pamela McCoach Vernee McFarlin David Michalski Elizabeth MillettYesford Puran Mittal Priscilla Moore Allene Murray Patricia Nassief James Nellis Man Ngo Phi Nguyen Thai-Hung Nguyen Maria Nicolau Robyn Nobert Maureen O’Hara Peggy Oremland Lynda O’Shaughnessy Eleanora Panizza Donna Paton Lindsey Peake Julie Pearson Brunhilda Peters Jerry Petitt Natalie Phan James Phillips Thomas Pietsch

Mary Pilgrim Soonja Purdy Jane Quill James Quinn Julie Qureshi Himani Raheja Maria Ramirez Esin Reinhardt Moises Reyes Ross Richmond David Ridley Treena Rinaldi Bonnie Rivkin Mike Rokni David Rosenmarkle Elizabeth Ross Frances Rudd John Sabo Munshi Sadek Mohit Sahgal Mohamad Saleh Paul Saltz Gene Sampson Jeff Satre Peter Schlossberg Carole Schweitzer Carter Scott Aaron Seekford Isaac Seekford Ashish Sharma Heidelore Shea Linwood Shelton Carol Simmons Suzanne Simon Monica Sims Anise Snyder E. James Souvagis James Stakem Greg Stiger Jake Sullivan Jeffrey Surdyk Carol Sutfin Swindell Sutton Babak Taghavi April Taylor Gregory Tomlin Karen Trainor Rajiv Vashist Sanjiv Vashist Virgilio Vasquez Arthur Walters Kevin Wiles Sandra Wilkinson Ann Wilson Holly Worthington Kendra Wright Felicia Wu Tony Yeh Beom-Gu Yeo Alla Yun Louise Zinzi Benjamin Zurun Mary Zurun

appraisers & affiliates

Appraisers A+ A+ Appraisals AAA Appraisals, LLC AD Brown Appraisals Advantage Realty Services, Inc. Alan Lord & Associates, Inc. AREAS Appraisers, Inc. BARCO BFM, Inc. Bruce W. Reyle & Company, Inc. Capitol Appraisal Service, Inc. Chevy Chase Bank Chevy Chase Bank, FSB Classic Appraisals CMS Appraisals, Inc. Curry Appraisals D&R Appraisal Services, Inc. Dan W. Mori DCO Appraisal Services, Inc. Dennis J. Park Diane V. Quigley Appraisal Dickman & Associates Distinctive Homes Realty, LLC

Affiliates

703-765-7579 703-865-5303 703-541-8212 703-866-5050 703-768-1954 703-866-6000 703-730-2272 703-670-2586 703-273-7375 703-691-8800 301-907-5850 703-648-9796 703-675-2265 703-209-9123 703-307-2579 540-751-2220 703-339-6136 301-855-3886 703-750-0560 703-830-6973 703-938-6633 540-338-4606

Realty Exchange Corporation

703-754-9411

Client Gifts Your Gifted Pro

202-579-9725

Commission Advance Commission Express

703-560-5500

Environmental Services Capital Environmental Testing, LLC 202-257-9291 Local Energy Alliance Program (LEAP) 434-825-0232

Financial Services

703-893-0900 571-331-6374 703-963-1743 703-433-2205 703-451-9020 571-213-7249 703-216-5147 703-406-7621 703-754-6110 703-280-1637 703-709-5695 571-261-3367 703-644-9877 301-946-4865 703-753-5635 703-268-0756 703-403-2024 571-255-7096 703-963-3988 703-644-7772 703-255-6451 571-277-1671

NB Valuation Group, Inc. Omni Appraisal Services Patricia C. Johnson, Appraiser Philip Arnold Appraisal Co., LLC Preston Hummer Real Estate Appraisals 4 You Renner, Hansborough & Reese Residential Appraisal Group, Inc. Riverpoint Appraisals Ryan Appraisal Services Sandra A. Le Blanc Silvey Appraisals, LLC Stewart Jarrett R E Appaisers & Consultants Suburban Appraisers & Consultants The Benjamin Group, Inc. VA-MD Appraisal Group, LLC Weichert Realtors William C. Harvey & Associates William Patten & Associates World Mortgage

301-654-1719 703-591-4001 703-405-6070 703-250-2132 703-929-0857 703-794-9118 301-258-8181 304-724-6041 571-333-3747 301-694-6500 703-629-6842 703-577-1946

703-855-7403 703-383-6858

REALTORS Federal Credit Union, Division of NWFCU 703-709-8900 The Washington Savings Bank 800-843-7250 VHDA 804-343-5748 Wells Fargo Home Mortgage Annandale 703-333-5541 Wells Fargo Home Mortgage Arlington 703-642-2300

703-671-3662 703-591-4200 703-684-3577 571-438-0604 703-893-1500 703-759-6644 703-642-8224 703-934-5502

Bold Listings Are NVAR Partners

1031 Exchanges

Acacia Acacia Federal Savings Bank Access National Bank Access National Mortgage Bank of America

Dittmar Realty Group Elite Appraisal Service F & F Appraisals Forte Appraisal Service, Inc. Gee Appraisers, Inc. Harry Graef Harry H. Arikan Hartmann Group Heiner Appraisal, Inc. Hendershott Appraisal Services Home Appraisers Homestar Real Estate Services Inman Appraisal Services, Inc. JDC Appraisals, Inc. Karas, Inc. Kinder Appraisal Services Lesley Omega Appraisers Lucky Appraisals McGraw Appraisals Metro Appraisal Services Monir Moshashaie Nancy M. Pruett

703-968-5685 703-871-1833 703-871-1300 703-319-2616

BB&T Mortgage BB&T Mortgage - Fairfax

Chase Home Mortgage Columbia 410-884-1088 Chase Home Mortgage Falls Church 703-641-6200 Embrace Home Loans, Inc. 800-833-3004 EverBank 571-933-6884 Fidelity Bank Mortgage 703-466-4050 First Home Mortgage Corporation 571-732-4270 First Home Mortgage Corporation Greenbelt 240-965-8153 George Mason Mortgage, LLC 703-802-5371 George Mason Mortgage, LLC Leesburg 703-443-1900 Homestead Funding Corp 703-734-2424 Intercoastal Mortgage 703-449-6828 Navy Federal Credit Union 888-842-6328 Navy Federal Credit Union 888-842-6328 PrimeLending 571-442-5193 Prosperity Mortgage 703-222-1800 July :: August 2013

Government Services Fairfax County

703-324-4804

Home Cleaning Services Maid Brigade

703-823-1726

Home Inspections AmeriSpec Home Inspections Anderson Inspection Consultants, Inc. House Inspection Associates Hurlbert Home Inspection

571-235-2755 301-855-3337 703-453-0442 703-577-7127

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Affiliates , continued Pillar To Post, Inc. - Herndon Pillar to Post, Inc - McLean Pillar To Post, Inc. - Oakton Red Star Home Inspection, LLC

703-657-3207 703-291-0344 703-402-2475 703-431-4339

Home Staging Services Decor Decorum M. Quinn Designs Preferred Staging Staged Interior

703-655-4789 703-354-6359 703-851-2690 703-261-7026

Moving & Storage Busy Buddies, Inc. 703-321-8564 Interstate Moving & Storage 703-569-2121 JK Moving 703-856-0636

New Home Builder Toll Brothers Willowsford

703-753-6688 571-297-2000

Oil Tanks

Home Warranty Services

Pollard Environmental, LLC

2-10 Home Buyers Warranty First American Home Buyers HMS Home Warranty Keystone Home & Environmental Services Old Republic Home Protection

Pest Control Services

703-587-6735 703-859-2700 800-843-4663 571-238-5201 800-282-7131

Insurance Services Northwest Financial Victor Schinnerer & Co., Inc.

123JUNK 1-800-GOT-JUNK College Hunks Hauling Junk

Radon Inspection

703-400-7645 703-934-4678 800-586-5872

Real Estate Forms

703-549-4820 703-941-3000 703-517-3333 703-506-9440 703-442-3890 703-299-3440

Locksmith Services National Lock & Key

571-449-6495

Marketing/Media The Washington Post

202-334-5775

Mold Services Clean 4 Clean

Accurate Radon Testing Arlington Radon

MB Associates

703-242-3600 571-331-2876

703-358-3515

888-407-5716

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Technology Services

DryHome Roofing & Siding, Inc. 703-891-4663

Centralized Showing Service 866-949-4277 Dotloop, LLC 513-257-0550 MRIS 301-838-7100

Settlement Services

virtual Tours

Advanced Title & Settlements 703-865-5444 Champion Title & Settlements 703-385-4555 Dominion Title Corporation 703-757-9500 Double Eagle Title Company 703-865-2519 Ekko Title - Centerville 703-448-3556 Ekko Title - Fairfax 703-560-3556 Ekko Title - Reston 703-481-6200 Ekko Title - Vienna 703-537-0800 Hometown Title & Escrow 703-691-1700 Key Title 703-437-4600 KVS Title 301-576-5580 MBH Settlement Group Alexandria 703-739-0100 MBH Settlement Group Annandale 703-852-3000

Captivate with Video Mouse on House

Roofing

Legal Services Brincefield, Hartnett, PC Joseph A. Cerroni, Esq National Real Estate Law Group, PLLC Pesner, Kawamoto, Conway Peterson, Noll, & Goodman PLC Rich Rosenthal Brincefield et al.

Allstates Termite Control Co., Inc. 703-578-3255 Asian Pest Services, LLC 703-752-1634 Barrier Termite & Pest Technologies 703-444-0496 Holiday Termite Pest Control 703-569-9333 My Exterminator, LLC 703-615-4028

703-810-1072 301-951-5495

Junk Removal

804-377-8383

MBH Settlement GroupArlington 703-237-1100 MBH Settlement Group Burke 703-913-8080 MBH Settlement Group Chantilly 703-277-6800 MBH Settlement Group Fairfax 703-279-1500 MBH Settlement Group Kingstowne 703-417-5000 MBH Settlement Group McLean 703-734-8900 MBH Settlement Group Reston 703-318-9333 MBH Settlement Group Vienna 703-242-2860 Monarch Title - Leesburg 703-771-0000 Monarch Title - McLean 703-852-1730 New World Title & Escrow 703-691-4330 Provident Title & Escrow 703-239-9600 Republic Title, Inc. 703-916-1800 RGS Title 703-903-9600 RGS Title - Alexandria 703-519-7600 Stewart Title & Escrow, Inc. 703-352-2935 The Settlement Group, Inc. 703-642-6002 The Settlement Group, Inc. - Burke 703-250-9440 Universal Title 703-658-1369

July :: August 2013

703-585-7772 301-972-3201

(Last updated June 17, 2013)

Interested in becoming an NVAR Partner or have a correction to this list? Please contact Tracy Reynolds at treynolds@nvar.com. 45

ask nvar

Disclosure of Sales Price to Appraisers; Lockbox Rules Compliance Whether showing a property or inking a deal, smart agents follow rules, suggested practices By Sarah Louppe Petcher

Q. A.

Why should I include the Disclosure of Sales Price to Appraiser clause in my contract?

A few years ago, at the request of some members, we established a clause library. One of the clauses in this library is the Disclosure of Sales Price to Appraisers. It became clear after the June Appraisal Summit that many of our members were unaware of its existence. The clause allows both the listing and the selling agent to disclose the under contract price to any appraiser who enquires. Why should you include this clause in your contract? Many of you may have experienced recent transactions in which appraisals became a problem. One of the reasons appraisals are not coming in at or above the sales price is because of the lack of accurate and relevant comps for the appraiser to use. In addition to recently sold properties, appraisers are authorized to use the prices of homes currently listed and under contract to gauge the value of a particular home. In a quickly changing marketplace, the availability of such timely data can make a difference in the appraisal report. You should encourage your clients to use this clause and include it into the sales contract. It is as follows: DISCLOSURE OF “SALES PRICE” TO APPRAISER. The Listing Broker and the Selling Broker are hereby authorized to release the Sales Price listed in the PRICE AND FINANCING paragraph of the Regional Sales Contract to any Appraiser who may contact them to obtain the information.

I am a listing agent, and another agent showed my listing. When I went to the property a few hours later, two windows were open and the lockbox was not closed properly, making the property key available to all! What should I do?

The lockbox rules which govern your use of the SentriCards provide that:

1. If you use your SentriCard to access the property and bring someone with you, then you must remain in the property until the person accompanying you has left, unless you have prior approval by the sellers to allow that person to remain in the property without you. 2. You must return the property key to the lockbox when leaving the property and ensure that the lockbox is closed. 3. You must ensure that all the doors and windows which where opened or unlocked by you or by anyone admitted to the property by you are once again closed and locked. 4. In the event there is more than one Lockbox on the property, ensure that the proper property key is returned to the proper box. A violation of any of these rules can be resolved by filing an ethics complaint through NVAR. This violation is eligible for the abbreviated process using NVAR’s citation system. Learn more at nvar.com.

Sarah Louppe Petcher is general counsel for NVAR.

July :: August 2013

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