Inside Real Estate - November 5th, 2019

Inside Real Estate (Nov 5th, 2019)

How to prepare for co-signing / Some Realtors 'not upfront' about commissions / Unusual penthouse won't sell

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1. You may end up having to pay on behalf of negligent primary borrowers if you don't take certain necessary precautions, Realtor warns. According to a 2016 survey, nearly 40 percent of co-signers had to pay some or all of a loan or credit card bill for a negligent primary borrower. Realtor suggests that before co-signing, you ensure that your name is on the title of the home, that you monitor a co-borrower's mortgage payments and that you make sure to establish solid forms of communication with the primary borrower. One way to confirm that the borrower is staying paid up is to ask a lender to notify you of missed mortgage payments or to set up text or email alerts that notify you when a month is past due. - REALTOR

2. The most expensive ballot question in New Jersey election history will be decided Tuesday, when voters determine if the state will enforce strict regulations on short-term home rentals. These would include rules like safety inspections, a 60-day cap on short-term rentals where a homeowner is not on site and a restriction on the number of units that can be used as short-term rentals per building. Airbnb has donated $4.2 million to an organization fighting against the restrictions, while the hotel industry is funneling roughly $1 million in support of the new guidelines. This topic has created a divide in New Jersey and has become a heated point of contention for local residents. - NEW JERSEY SPOTLIGHT

3. Speaking of short-term home rentals, residents in Orlando, Florida are embracing what they call the "apart-hotels" movement, which refers to a growing number of homeowners leasing properties out to tourists instead of tenants. Most buildings within city limits can only lease out a limited number of units per structure for a professional leasing agency to manage and market (usually by listing residences on platforms like Airbnb). This shift is upsetting some locals who don’t want to feel like their residential neighborhoods are becoming tourist-packed travel hotspots. The American Hotel and Lodging Association goes as far as saying that these apart-hotels “flout basic safety and security laws, zoning rules and taxes.” The city’s current policy only allows homeowners to lease out just half of their dwellings and only while they’re staying on the property.  - ORLANDO SENTINEL

4. Most brokerages and real estate agents are generally not always upfront about their commission fees, a study by the Consumer Federation of America reveals. According to Forbes, this has negatively impacted American consumers' ability to negotiate. Forbes says that while there’s typically transparency for most consumer services across the nation, real-estate commission data are not easily accessible to the public. The CFA's survey reports that this may lead to agents steering clients toward higher-commission listings that benefit them and their firms. Currently, the average U.S. Realtor commission is 6 percent, which is more than triple what average commissions looked like in the UK. There’s at least one U.S. brokerage, REX Real Estate, that pays agents annual salaries rather than the industry standard of commission. - FORBES

5. New York City developer Ken Horn is hoping that an architectural intervention combined with a $31 price reduction will help sell the unique penthouse of the Woolworth Building in Manhattan. The 1913 building features a curious layout with a 360-degree observatory deck. The space has proven difficult to configure, which may be why the penthouse — listed since 2015 and marketed since 2017 — has sat on the market so long. (And why its price tag is going from $110 million to $79 million.) Prospective owners don’t know what to do with the tower, Horn said, which is an oddly shaped five-story build. The developer is now employing an architect with a niche for transforming strange spaces, David Hotson, to help potential buyers envision a home within the 50-foot-tall "yacht-like" living room and neo-Gothic details. - WALL STREET JOURNAL

6. HomeLight — a tech company that pairs real estate agents to clients — has secured $109 million in new funding. The company, which launched in 2012 and now employs 200 people, features proprietary algorithms that analyze tens of millions of real-estate transactions as well as millions of Realtor profiles to determine the perfect pairing for each transaction. The company claims to connect agents to deals every two minutes; most of the agent profiles it scans come from major U.S. brokerages. As Homelight CEO Drew Uher puts it, they’re “building the Amazon of real estate.” - CNBC

7. The Brentwood, California, mansion of TV Producer Norman Lear is back on the market for nearly $40 million. The 8-acre parcel and its 14,000-square-foot main house was listed for $55 million in 2015 and reduced to $49 million in 2016 before being temporarily pulled from the market. In addition to its expansive main structure, the property also includes a three-bedroom guesthouse, 35-car garage, tennis court and onsite staff and security offices. Lear — who bought the house for $6.5 million in 1988 — is best known for TV shows like “The Jeffersons” and “Sanford and Son" and movies that include "Princess Bride.” Reality TV stars and Douglas Elliman agents, Joshua Altman and Matthew J. Altman, are partnering with  Andreas Elsenhans on this listing. - MANSION GLOBAL

9. Some Malaysian residents are calling out a Star Newspaper infographic that they say falsely and grossly underestimates what it costs to live and rent in Malaysia. According to the Belanjawanku Expenditure Guide 2019, a person only needs to earn $600 U.S. per month to live comfortably in the Klang Valley of Kuala Lumpur, with just $73 allotted for rent. Twitter users have expressed that these costs are not realistic. As one Twitter user said: “RM300 for housing has got to be the funniest. This must refer to renting a room at a terrace house that's been sub-divided into 10 rooms.” According to one expat site, a more reasonable estimate would be a 900-square-foot furnished unit renting for roughly $764 and $443 on the low end. That’s still affordable compared to most North American markets, but still not $73. - MASHABLE SE ASIA

9. An investment company in Oklahoma City, Oklahoma, is suing a man who allegedly pocketed hundreds of thousands of dollars that was supposed to be used for home-flipping projects. Real Impact Investments of OKC alleges that it loaned LRG Properties owner Chris Mitchell $200,000 to help him buy rehab and properties that would then be sold or leased out. Real Impacts was then supposed to receive portions of the rental income, but instead it claims Mitchell kept the money to launch his own company. - KFOR

10. Market snapshot: the 10 most expensive homes purchased from Oct. 21 through Oct. 25 in Northeast Florida range from an $840,000, 4,467-square-foot single-family house to a $1.35 million 6,221-square-foot estate. These include residential closings in Baker, Clay, Duval, Nassau and St. Johns counties. In between No. 1 and No. 10 are homes priced at an average of roughly $1 million with a square footage at or above 3,000 per home, with the exception of a 1,875-square-foot St. Augustine, St. Johns County property which sold for $850,000. - JACKSONVILLE DAILY RECORD

Written and curated by Darla Guillen Gilthorpe. Darla writes for the Houston Chronicle, where she was part of its 2018 Pulitzer Prize finalist staff. She was previously an editor at Vox Media site Eater and has had bylines in Elle Decor, SFGate and various other outlets. Follow her on Twitter here.

Editor: Kim Lyons (Pittsburgh-based journalist and managing editor at Inside).

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