The index for the commercial real estate market rose slightly in the first quarter to the highest level on record according to a report by the NATIONAL ASSOCIATION OF REALTORS®.  However, the rate of growth has decelerated over the past year.

Commercial real estate practitioners can anticipate leasing and sales activity in the third quarter of this year to be approximately 0.8 percent higher than the third quarter of 2006.

Appraisers say they are feeling a lot more pressure in recent years to boost their estimates of residential property values for loan approvals, according to the 2007 National Appraisal Survey, conducted by market information provider October Research Corp. for Forsythe Appraisals LLC in St. Paul Minnesota.

Seventy-one percent of appraisers said mortgage brokers applied pressure in 2007, up from 60 percent who said that in 2003.  Real estate practitioners are also applying pressure, with 56 percent of respondents citing such pressure, up from 47 percent four years ago.

There are several bills in the works to shore up appraiser independence, including the Fair Appraisal Act (HR 1723).

Real estate transfer taxes levied by local government have long been a transaction reality, but now developers and homeowners associations at private communities have jumped on this revenue source and are imposing private transfer taxes on homes sold in their development, an industry expert told REALTORS® who attended the NATIONAL ASSOCIATION OF REALTORS® Midyear Legislative Meetings in Washington D.C., last week.

The taxes, which are generally based on a percentage of the sale price of each home, are written into the deeds. 

The 21^st Century G.I. Bill of Rights Act has been introduced into Congress.  This legislation would expand opportunities for U.S. veterans to purchase, build, repair, or improve a home by increasing their access to low-interest loans through the VA Home Loan Guaranty program.

Under the 21^st Century G.I. Bill of Rights Act, veterans will be exempt from paying loan fees and will be have access to low-interest VA loans for homes valued up to $625,000.  The current program caps loans at $417,000.  The bill will guarantee eligibility to all service members – Active Duty, National Guard and Reserves – who have served since September 11, 2001.

Legislative Day and California REALTOR® Showcase will be held in Sacramento on June 6^th.  REALTORS® from across California will gather for the CALIFORNIA ASSOCIATION OF REALTORS® 37^th annual Legislative Day.  Among the day’s events are opportunities to meet with state legislators to discuss issues affecting the real estate industry; the Member Director Forum, which previews the policy, legal and regulatory topics that the C.A.R. Directors will consider during the business meetings; and the Capitol reception, a ticketed event held to thank REALTORS® who contribute each year to the REALTOR® Action Fund.

The California median home price in March 2007 was $580,000.  The Santa Barbara South Coast median home price was the highest at $1,200,000 and the lowest median home price was in the High Desert at $320,830.  The California First-time Buyer Affordability Index in the Fourth Quarter of 2006 stood at 25 percent.  (Source: C.A.R.)

The U.S. Department of Housing and Urban Development (HUD) announced that communities throughout the nation will receive grants amounting to nearly $1.8 billion to help promote affordable housing and assist first-time home buyers.  The funding will support HUD’s HOME Investment Partnerships Program (HOME), which is designed to produce affordable housing for low-income families, and the American Dream Downpayment Initiative (ADDI), a program aimed at helping first-time buyers with their down payment and closing costs.

The additional funding for both programs was granted in order to build economically stronger communities throughout the U.S.  Since the programs begin, HOME has produced more than 781,000 affordable housing units in 645 different communities and ADDI has assisted 23,000 first-time home buyers.

Senate Bill 670 (Correa), “Private Transfer Tax Prohibition” was defeated by the Senate Transportation and Housing Committee, but a second bill calling for the disclosure of private transfer taxes to potential buyers passed the Assembly Judiciary Committee.  AB 980, (Calderon), “Disclosure of Pre-existing Private Transfer Taxes,” is eligible to be heard by the Assembly.  If passed, AB 980 will require a separate disclosure to potential home buyers to inform them if a home they are considering to purchase requires the payment of a private transfer tax (PTT); the percentage of the home price constituting the PTT; the duration and recipient of the PTT payment; and an advisement that the buyers should take into account the benefits and costs of the PTT when deciding whether to purchase the home.  The measure will require the developer imposing the PTT funds to record a separate disclosure; if they do not so, the new home buyer will not have to pay the PTT.