Every year, there are new laws/rules plus other changes that realtors need to know. Yesterday was the annual review by Gov Hutchinson, the assistant general counsel for the California Association of Realtors.
Gov has been with C.A.R. since 1985 and manages C.A.R.’s Member Legal Services Program in Los Angeles. Gov advises REALTORS® through the “Hotline” on all aspects of real estate law and he trains and supervises other “Hotline” attorneys. Gov received his Bachelor’s Degree in History from Princeton University and his Juris Doctorate from the University of Pennsylvania.
Because he runs the Hotline, he hears all the feedback about the current forms and issues and he is the best equipped to deal with them!
He is a fantastic speaker and we enjoy going every year to learn and laugh with Gov! One agent stomped out when Gov wouldn’t agree with him about listing agents offering a specific compensation to the buyer-agents on the phone. I agree with Gov – a verbal offer over the phone isn’t binding, so why bother?
The highlights:
On Tuesday, Gavin Newsom signed an executive order mandating that homes in the fire zone could not be sold for less than they were worth on January 6th. The idea sounds preposterous, but the scammers are already out making lowball offers so I guess something has to be done:
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As of August 17, 2024, the NAR Settlement required realtors to complete a buyer-broker agreement with their buyer clients prior to viewing residential properties in person. The State of California supplemented the practice with their own law that began on January 1st, and the Department of Real Estate will issue their own mandate shortly. Between the two, they will require that every licensee (realtor or not) has a written buyer-broker agreement before showing any type of property, not just residential.
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The initial exclusive buyer-broker agreement could be cancelled with 30 days notice. The latest version allows for 30 days or less, as negotiated in paragraph 2F. Buyers may feel more comfortable signing an agreement that can be cancelled on short notice, and if you are going to cancel, you might as well get it over with. Choosing 1, 3, 5, or 10 days may now be more appropriate here:
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This new form change is welcome. Whenever a buyer or seller wanted to agree to a deal but the offer or counter-offer had expired, we would have to author another addendum to extend – leaving the door open for possible shenanigans.
Now the verbiage is included – as long as the other party signs the paragraph 6, then we have a deal. The delay is still possible, but at least we don’t have to agree on who will be writing the addendum and exactly what it needs to say to make everyone happy:
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Tenant rights are already long and lengthy but every year the rentals category gets at least twice as many changes as sales side:
A. There is a new form for landlords to report the tenant’s payment history to the credit bureaus. But it’s only required if the landlord owns two or more rental properties. They are able to charge the tenant $10 per month for this service.
B. If a landlord is going to keep more than $125 of the tenant’s deposit, they need before and after photos.
C. Any clause that states the tenants are responsible for professional carpet cleaning at move-out is unenforceable. Carpet cleaning is only required if it is ‘reasonably necessary’.
D. The seller is responsible for maintenance when renting back after the close of escrow.
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Rent Gouging is illegal in areas that have been declared to be in a state of emergency. Rents can’t be jacked more than 10% of what are currently or what they were over the last 12 months. If the property is new to the rental market, the rent can’t be more than 160% of the HUD standard in the area. Even when there are multiple tenants bidding up the rent, it can’t go higher than +10%.
What areas are in a state of emergency? ALL of California has been in a state of emergency……due to the Bird Flu. The notice expires on Friday so wait until Saturday to gouge tenants around here.
The Tenant Protection Act of 2019 limits the annual maximum increase in rents to 10% or CPI + 5%. This year in San Diego County, the CPI + 5% = 8.8%.
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That’s about all for now!
BTW, I ran into another long-time agent in the parking lot. When I told him that I’m getting a call a day from potential sellers, he said he’s taken TEN listings in the last seven days.
We agreed – in our decades of being in this business, we’ve never seen it like this! The fires may be providing a bit of a respite, but a flood of listings is coming.
#1 Goal? Buy a house owned by a designer – they always max out their own home! This recent remodel was meticulously crafted with high-end premium upgrades throughout, including full gourmet kitchen with Wolf/Sub-Zero, a sensational primary-bath customization, hardwood flooring, new dual-zone HVAC installed in 2025, custom wrought-iron stairrail, and it has the secluded bedroom suite downstairs – all on a culdesac one block from Ocean Air Elementary! Backyard includes infrared grill and wood-fired oven imported from Italy plus all new painted fence and gates! Wow! Don’t miss this one! Less than a 1/4-mile to Starbucks and only 1.2 miles to I-5 freeway. Don’t get stuck in PHR traffic – this location will set you free!
Open 2-4pm on Friday and 11am – 2pm on Saturday and Sunday
Downstairs suite
Similar house behind us with the same price went pending right away and has a back-up offer:
Instead of insuring the rebuild after a fire, it is in everyone’s best interest to find ways to prevent homes from burning down. The Bel Air Fire of 1961 led to the banning of the wood-shake roof, and homes built today have little or no overhanging eaves and what they do have is closed off. Can concrete homes built by 3D printers be far behind?
These fires should lead to a rapid expansion of private firefighting, and while we’re at it, private police/security should be a booming industry too.
The pendings line is barely noticeable on the graph above because it mirrors the 2024 line closely. The number of pendings dropped because so many sales are closing – there have already been 43 NSDCC closed sales in January, and we should exceed last January’s count of 102 sales fairly easily.
But the change in active listings is the lowest of the last three years – only a slight uptick. It would take a real crush of new listings for the active count to get to 400 by the end of the month, and the fires will probably delay any surge this month.
Over 100 people attended our open houses over the weekend, and the home was well received. It is rare to see an 80-year old bungalow improved this nicely!
The first responders have done an incredible job evacuating so many thousands of people at a moment’s notice. It will be one of the major stories of this fire because of how few casualties there are – it’s been a miracle.
How you can help:
You can support the Red Cross by making a donation online, by calling (800) 733-2767 or texting REDCROSS to 90999.
GoFundMe has created a centralized online hub housing all verified fundraising pages related to the wildfires. The hub will be updated with accounts as they are verified by the GoFundme team. At the top of the hub is also GoFundMe’s Wildfire Relief Fund 2025.
The California Community Foundation distributes grants to affected communities through its Wildfire Recovery Fund. The foundation’s team utilizes data from CalFire and CDC’s Social Vulnerability Index to ensure their grants target the neediest communities with both intermediate recovery and long-term support. You can make a monetary donation online or by mailing a check to the “California Community Foundation” at 717 W. Temple St., Los Angeles 90012. Include “Wildfire Recovery Fund” in the memo.
Musicares, a nonprofit safety net of health and welfare services for the music community, is offering anyone in the music industry (with five or more years experience in the music business) with immediate assistance including $1,500 financial assistance and $500 food vouchers. Contribute to Musicares efforts by making anonline donation.
Best Friends Animal Society, has activated two pet pantry locations in Los Angeles that can provide essential supplies including pet food, cat litter, pet beds and other necessary items as well as human sanitary products for those who have lost everything. Contribute to the pantries here: donate online. All funds go toward emergency assistance to pets impacted by the wildfires in Los Angeles. Donations top this fund are also directly supporting pet lifesaving work in the area.
There is also a call for supporting the Los Angeles Fire Department by donating to the Los Angeles Fire Department Foundation. The foundation is seeking monetary donations to equip firefighters battling the wildfires with items including emergency fire shelters, hydration backpacks and wildland brush tools. Click here to donate.
My favorite video of a local fire – no homes were lost!
