Pat Taylor is a freelance writer.
State Roundup: Rhode Island, New York, and Utah
May 1, 2003
New York: Disclosures happen—or not
Most sellers are dropping $500 from the price of their home rather than disclose defects using a form that took effect last year, according to a New York Times article published on Feb. 28. The newspaper quotes real estate attorneys saying most sellers, concerned about their legal vulnerability should they err in disclosing environmental, structural, and mechanical conditions on the form, prefer to sell without disclosures. Under the law, sellers who don’t fill out the form must credit $500 to the buyer at closing.
But the New York State Association of REALTORS® thinks the newspaper exaggerates the unwillingness of sellers to use the forms. “There’s no data to show to what extent sellers aren’t filling out the form,” says Duncan MacKenzie, NYSAR government affairs director. “Some have; some haven’t. But it’s certainly not across the board.” In any case, says MacKenzie, even if their clients don’t fill out the form, real estate practitioners, if they know of defects, remain obliged under state licensing law to let buyers know of them.
Rhode Island: Staying smart
Real estate practitioners face beefed-up continuing education requirements under state licensing changes taking effect this year. The changes require practitioners to complete 18 credit hours of classes, up from 12 hours, including instruction on contract law, license law, agency law, fair housing, ethics, and lead-based paint. Practitioners have until April 30, 2004, to complete the new course requirements. Practitioners licensed prior to Dec. 27, 1984, are exempted.
Utah: Link to trouble?
Homeowners in Utah are wrestling with the third-highest foreclosure rate in the country, based on Mortgage Bankers Association of America data for the fourth quarter of 2002. The problem prompted local and regional officials of the U.S. Department of Housing and Urban Development to meet with REALTORS® in the state earlier this year to explore causes. One reason discussed: the growth of no-downpayment homeownership programs, which can lead to higher mortgage burdens and leave buyers with no equity should a job loss force them to sell suddenly.
Utah may be vulnerable to no-downpayment problems for two reasons, says Butch Dailey, CRS®, GRI, 2003 president-elect of the Utah Association of REALTORS®. The state has a lot of new, young households, which are the biggest users of the programs, and parts of the economy have been stumbling since the end of the 2002 Winter Olympics, sending home prices down in some areas. In Utah, the foreclosure rate is 1.92 percent compared to 1.18 percent nationally, according to fourth-quarter 2002 MBA numbers.
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Updated: September 30, 2022