May 2004 Issue
Page 3

STATE NEWS

Commercial Broker License Portability/Non-Resident Licensing

 This legislation has now been signed by the Governor. The legislation contains two concepts.

The first is a mechanism for Indiana’s commercial practitioners to conduct transactions with brokers licensed in another state under certain circumstances. This concept, referred to as “license portability” was brought to us by the Indiana Commercial Board of REALTORS®. It applies only to the sale of commercial real estate. Passage of this bill improves our member’s ability to participate in business location and expansion opportunities.

The new law allows such cooperation if:

• There is a written agreement between the out of state broker and Indiana licensed broker outlining terms of cooperation and compensation.
• The out of state broker furnishes proof of a license in good standing from another state.
• The out of state broker files an irrevocable consent with the Indiana Real Estate Commission so legal action may be commenced if they violate Indiana law.
• The Indiana broker maintains escrow funds, if any, and all documentation of the deal.
• Advertising is done in compliance with Indiana law, and includes the name of the Indiana broker.

Septic System Regulation

We were also successful in passing legislation that prohibits the Indiana State Board of Health from implementing an onerous, anti-growth requirement for septic systems. They have worked for years on a rule that would have required installation of secondary treatment in systems in certain parts of the state. That secondary treatment would have cost an additional $6,000-$10,000, beyond the current cost of a septic system. Amazingly, the manufacturers of these secondary treatment systems claimed that they could not meet the standard that would have been put in place. In other words, consumers would have borne this huge new expense, to purchase a system that still was out of compliance with the new standard.

Mortgage Fraud

Another IAR priority this year was to pass legislation enhancing the state’s ability to fight mortgage fraud, without unduly harming the mortgage market. Again, we were successful in that effort, as HB 1229 has been signed into law.

HB 1229 represents middle ground reached after lengthy negotiations between consumer advocates and the lending industry. It includes creation of a homeowner protection unit in the Attorney General’s office, and establishes a new homeowner’s education program in the Department of Commerce, funded by a $3 recording fee increase on mortgages. The bill also puts new requirements in place for “high cost” loans, and outlaws some practices for any mortgage. Importantly, the new restrictions do not apply to federally or state chartered lenders, or to loans that can be purchased by Fannie Mae, Freddie Mac, or the FHLB, and jumbo loans. These exemptions were critical to the lending community, and mean that the new restrictions are significant, but narrowly targeted.

Taken from IAR Legislative Express

2003 Indiana REALTOR® Member Profile

In the fall of 2003, Indiana participated in the Member Profile which NAR conducts every two years. The complete Profile may be found at IAR’s web page www.indianarealtors.com.

Here are some of the highlights of this most recent look at Indiana’s REALTORS®:

• 52% of all REALTORS® are female and 48% are male
• The typical Indiana REALTOR® is 50 years old
• 95% describe their race as White or Caucasian; 2% describe themselves as Black or African American
• 2% as Asian or Pacific Islander and 1% each as Hispanic or Latino and as Native American
• Median gross income from real estate and related activities is $51,200
• Typical REALTOR® has completed high school and some college
• The median household size for REALTORS® is two persons

When looking at business characteristics of Indiana REALTORS®, we found the following:

• 56% hold brokers’ licenses and 44% salespersons’ licenses
• Typical REALTOR® has been active in some phase of the business for 12 years
• 66% of REALTORS® represent both sellers and buyers; 17% practice single agency; 6% are exclusively buyer agents; 7% are exclusively seller agents and 4% primarily practice transactional agency
• REALTORS® work a median of 43 hours per week
• 75% have a percentage commission split with their brokers
• Typical REALTOR® has a sales volume of $1,750,000 and spends $7,600 in total real estate expenses
• 72% of REALTORS® plan to remain active in real estate for at least two more years

In the use of technology:

• 75% of REALTORS® frequently communicate via email
• 90% of REALTORS® frequently use cell phones
• 52% of REALTORS® frequently use digital cameras
• 75% of REALTORS® report never having used wireless email systems like Blackberry
• The typical REALTOR® uses email to communicate with buyers and sellers 24-50% of the time
• 37% of REALTORS® have their own personal web site for real estate business purposes that is separate from their company’s web sites
• 87% of REALTOR® firms have Internet web sites

Taken from Indiana REALTOR® - April