August 19th, 2015

A Move in the Works


By: Victor Normand
Published: August 2015

Acton Real Estate

Acton Real Estate

Acton Real Estate Company is moving to new offices in West Acton Village. The new space will be in the recently built Villageworks complex on Massachusetts Avenue, in an area fast becoming the most active and interesting commercial center in town.

Just as living space needs for individuals and families changes over time, spaces for businesses evolve as well. Sometimes the current space is too large or too small, sometimes the type or arrangement of spaces has changed, a location closer to amenities becomes a consideration, and sometimes we just need a change.

Businesses, like families adapt their needs to whatever space they are in until they have reached the point, for any number of reasons, where something just has to be done and then the wheels of change are set in motion. Once that happens, the urge to move begins to build and all the pros and cons get listed to see which list will be longest and prevail.

For a business like a real estate office, the space has to be functional and efficient, but it must also reflect the way workers and clients expect to do business today. Work environments for customer service businesses are more open and inviting these days, physical barriers between workers and customers have fallen. Those who sell goods and services are no longer the fount of all wisdom they once were. The information age has armed consumers with abundant information, now it is all about forming trusting relationships along with a demonstrably superior knowledge of the product or service.

The new space we are moving to, first of all is new, and that is almost always attractive to staff and customers, not unlike the appeal of new homes over older homes. And it is not just that new is shining and bright; new is able to respond to the latest technologies, current design trends and proven innovative concepts. The new space and new furnishings convey forward thinking, an openness to all that is new and creative.

The decision to move Acton Real Estate was not made easily. The company has operated from 371 Massachusetts Avenue for almost exactly 60 years since it began as a business in 1956. The move to 525 Massachusetts Avenue is barely a mile down the road but the look and feel of the offices as well as its village setting will be a world of difference.

The means to access services now is almost exclusively by automobile; the new location accommodates parked cars nicely, but is in the midst of a walkable environment. The present location is a free standing building; the new office is among other service, professional, retail, food businesses and event spaces. A lively, interesting gathering of busy people makes us all feel social and engaged.

Now that we have made the decision to relocate, and construction has begun on the office fit-up, we are all anxious to be working in the Village and welcoming our friends, neighbors and other clients to the new home of the Resident Expertsm. You can check on the progress with weekly updates on our Facebook page and then come by when we open the doors early this fall.

July 16th, 2015

The Real Estate Commission – How it Really Works


By: Victor Normand
Published: July 2015

Part II

The actual commission rate is determined by the marketplace. The rate which prevails in any given market is continually challenged by so called discount brokerages and various self-help real estate selling services. Under our economic system, only the government or governmental agencies can fix prices and real estate commissions are no exception to this. Real estate companies cannot collude among themselves to set rates, though rates can be set by individual company policies for their services, and consumers are free to accept, reject or negotiate those rates.

Under law in Massachusetts there is no requirement for a consumer to have either a seller or buyer agent under contract. However, in order to list property with a multiple listing service (MLS) a listing agreement must be in place. And although both buyer and seller agents are paid a fee, buyer agents rely on the listing published by the MLS to know their level of compensation. A contract with a buyer agent could specify a fee, but that fee is customarily offset by any fees posted in the listing.

The commission stated in the listing agreement which is paid to the listing broker in full at closing is intended to compensate both the buyer agent and the selling agent. It is usually split evenly, but not necessarily. So there are two licensed professionals representing separate clients paid by the seller. However, in actuality, it is the buyer who is paying the commission as part of the purchase price. Unless the property has an upside down mortgage (the sellers owe more than the property is selling for), only the buyer brings money to a closing.

Nearly all property sales include commission in the sale price. It is akin to offers of “free shipping;” shipping isn’t free at all; it is merely included in the cost of whatever is being shipped. Aggregating recent sales of comparable properties to arrive at a projected sale price of a subject property therefore includes commissions paid. So then, the buyer in most instances has no contractual obligation to pay the buyer agent a commission, but ends up effectively paying not only the buyer agent, but the listing agent as well.

The process and practice is complicated and rife for misinterpretation, but it does serve to protect the consumer by providing for a licensed and insured professional operating under strict real estate law. Furthermore, all real estate agents in Massachusetts must work under the supervision of a licensed real estate broker within a licensed real estate brokerage. As mentioned, the commission stated in a listing agreement pays both the list and the buy side of a real estate transaction. In most situations the commission is divided among four parties; the listing agent and buyer’s agent and their respective brokerages.

The internet has radically changed how businesses operate today. More and more retail business is done on line, automobiles are not sold like they used to be and the travel agency is nearly extinct. But real estate agency is as strong as it has ever been. Almost all real estate buyers search for and most find property on line, yet over 90% of all buyers use a real estate agent to make the deal.

Redfin, Trulia, and Zillow have all tried to use technology to replace the real estate agent with limited success. In the end, housing is not a commodity like a book or an automobile and its economic scale is outsized. The internet has made much more information available to consumers, so much so that what may have seemed like a simple process is revealed for its true complexity. The logarithm that replaces a licensed, well trained, and experienced real estate agent has not been written.

The importance of an organized, stable and active real estate market is fundamental to our economy. The role of government regulation, housing associations and the real estate professionals who operate by those standards should not be underestimated or taken for granted. We have recently seen what happens to the economy when the real estate market is disrupted. Hunter-gatherers may have no need for a Resident Expertsm, but you do.

June 17th, 2015

The Real Estate Commission –Some History


By: Victor Normand
Published: June 2015

Part I

Owning property or having rights to it meant little to our hunter-gatherer ancestors, then, beginning about 30,000 years ago, it did. The shift to an agrarian society for most of mankind established the importance of having ties to the land. As societies became more advanced, farmers looked to higher authorities to safeguard rights to hold and use the land. Family elders, village leaders, kings and queens and various forms of government provided a means to temporarily or permanently create rights to the land itself or at least the right to farm it. It is from this need to make the possession of land more secure that official order, common law and eventually written law emerged.

The rise of capitalism and the industrialization of the economies heightened the need to organize the ownership and transfer of property for the benefit of individuals and corporations. In the 1850’s, the first real estate brokerages were established in Chicago. From that time on into most of the twentieth century, the relationship between real estate brokers and their clients was simple: listing brokers represented sellers and the agents who worked with buyers were “subagents” of the listing broker. Buyers were unrepresented.

Under this system and into the twentieth century, most real estate listings were “open listings,” allowing anyone to bring a buyer to the seller (still common in many international markets). Not surprisingly, brokers did not market properties or cooperate with other brokers, and sellers could deal directly with buyers, bypassing brokers altogether. The real estate industry was not organized and very much open to speculation. Often, complicated transactions ensued and consumer abuse was common. As a result of all this, real estate brokers and agents were not held in high regard.

The solution to this problem, put forth by the National Association of Real Estate Exchanges (NAREE) (the predecessor of the National Association of Realtors) was to professionalize the brokerage trade. The relationship with clients and between agents would be set forth in an industry code of ethics and individual state licensing laws. The goal was to raise the profession to the level of lawyers, accountants, and architects where brokers would have duties like loyalty, financial accountability, and obedience and good faith dealings.

By taking on these legal responsibilities, brokers expected to have an exclusive agency relationship with clients and be paid a commission for their services regardless of who brought a buyer to the deal. The advent of the exclusive listing aimed to find the correct balance between protecting consumers and fairly compensating real estate brokers and agents. The only flaw in this arrangement was the fact that buyers remained unrepresented. (See the blog “Who’s Looking Out for Me,” February 2015)

This brings us to the matter of explaining in greater detail the real estate commission. Now that we have all the players: Sellers and buyers and their respective brokers and agents, real estate associations and state licensing authorities, we can begin to see the interplay of the commission structure.

To Be Continued in Next Months Blog: The Real Estate Commission – How it Really Works

May 20th, 2015

Do You Need a Real Estate Agent?


By: Victor Normand
Published: May 2015

Donald Trump was recently asked why he thought he would make a good President. He answered “because I know all the right people.” And that’s not a bad answer. Engaging a good real estate agent makes YOU smart. While tapping into their knowledge and experience is a very good thing, having access through them to their local office support and to their list of other housing professionals is important and indispensable.

Referral networks are increasingly popular these days. One of the major benefits of social media allows participants to share their experiences with others. Real estate agents have always valued referrals as the most effective way to build their business. Getting started on a real estate adventure is easy going at first, but it rarely stays that way; ask anyone who has just completed a deal. Testimonials are a good way to learn about an agent and often a window into some of the complicated situations that often arise on the way to a closing.

What about deciding against using a real estate agent? In an attempt to “save” that commission expense, whether or not you save money buying or selling a property is not so certain. You can search on line for legal or medical advice and save those professional fees as well, but that might not be cost effective either. It’s all about believing that your agent represents a value proposition.

A buyer more focused on using commission money as part of negotiating a purchase by dealing directly with a seller or seller’s agent may succeed, but their negotiating success may be limited. A buyer agent brings knowledge of the local market and practical experience to every transaction. There is a vast difference between someone who does a real estate deal once every seven to ten years and someone who may have done more than seven to ten deals in the past year.

There might be comfort, if not safety, in believing that “you don’t know what you don’t know.” But, that is no defense in situations involving discrimination, home inspections, lead paint notifications, legally binding agreements and a host of other legal requirements that are a part of every real estate transaction. Whether you are a buyer or seller, full disclosure and knowing your rights can help protect you from financial difficulties, wasting time and preventing extended periods of stress and anxiety.

The Board of Registration of Real Estate Brokers and Salespersons enforces existing licensing laws and regulations on behalf of consumers. Real estate agents are required to maintain active licensees and regularly participate in continuing education. In addition, many real estate agents, including all of the Resident Experts sm at Acton Real Estate are REALTORS®, members of the Massachusetts Association of Realtor and the National Association of Realtors. As members, REALTORS® must abide by a strict code of ethics, which is also subject to continuing education requirements.

So, when you know a Resident Expertsm who is also a REALTOR®, you know the right people.

April 20th, 2015

The Demise of the 30 Year Mortgage


By: Victor Normand
Published: April 2015

The subprime lending crisis is history, but its effects on the residential real estate industry will remain with us for a long time. The most apparent changes have been tighter lending standards and greater transparency with consumer protections for home buyers, but other less visible changes may be happening, changes that could make home buying out of reach for lower and moderate income borrowers looking for an affordable mortgage.

At the time of the crisis in 2008, the federal government through “government sponsored enterprises” (GSE’s) Fannie Mae and Freddie Mac, guaranteed more than three quarters of all outstanding home mortgages in the country. Though federally chartered for the public purpose of providing low interest rate mortgages and affordable housing, the GSE’s are privately owned by their stockholders, stockholders who were interested in profitability. To achieve increased profitability, the GSE’s fought increases in capital requirements and regulation.

When the financial crisis hit in September of 2008, Lehman Brothers filed for bankruptcy and the big banks were threatened with collapse, it would not be long before the GSE’s suffered the same fate. Nearly $200 billion was needed to keep them solvent. The U.S. Treasury provided the funds under the terms of a conservatorship that took control of Freddie and Fannie and set the stage for their eventual demise.

The view of many in the housing and banking industry is that without Freddie and Fannie there will no longer be the 30 year fixed rate mortgage that has fueled the home buying market.   At the end of World War II when only 40% of Americans owned their own homes, the 30 year mortgage envisioned as part of the New Deal in 1938 was new on the scene, today over 60% of Americans own their homes. Without the guarantees provided by the government through the GSEs, it is unlikely that lenders would be willing to take such long term risks, particularly in the current low interest rate environment. Today, many higher income home buyers are opting for 10 and 15 year mortgages, but the 30 year mortgage is critical to many first time and moderate income borrowers.

The structure of the conservatorship seems to dictate its demise, probably by 2018. Legislation in Congress has bi-partisan support and recently the President has indicated his support for a change. The effects of a sudden end to government guaranteed mortgaged backed securities would be an economic disaster. Housing and housing related services accounts for over 17% of the country’s Gross Domestic Product. The progression that begins with buyers who can only afford smaller mortgages and moves to lowered home values and then loss of equity and finally to recession is very familiar to everyone.

The legislation to wind down the GSEs has names like “The Protecting American Taxpayers and Homeowners” and “Housing Finance Reform and Taxpayers Protection Act” both sound like just what the country needs, but the devil is in the details. The National Association of Realtors strongly opposes these bills and other efforts that disrupt the current housing finance status quo, but the damage has been done. Less dependence on the federal government for the health of the housing sector of the economy would be a good thing, getting from here to there needs to be done carefully, very carefully.

March 17th, 2015

The Network and Relationships


By: Victor Normand
Published: March 2015

Manager, Krystal Brule, accepting Award on behalf of Acton Real Estate in Las Vegas

Manager, Krystal Brule, accepting Award on behalf of Acton Real Estate in Las Vegas

Press Release:
International Real Estate Conference Draws 2,000 Attendees
Local Firm among Top Award Winners – and that would be Acton Real Estate.

We all work in a networked economy. Businesses routinely tout their connections to vast networks, some that circle the globe, to illustrate how their customers benefit from doing business with them. Some networks are based on numerous company offices, some by industry. The truth is any network is only useful when there is interaction among those who belong to the network.

Acton Real Estate belongs to a global network of independent real estate companies, called the Leading Real Estate Companies of the World® (LeadingRE). The criterion for membership is rigid and requires that members refer relocation business to one another regularly. In doing so, it’s a routine business for us to ensure that our clients will be referred to a company that we know will serve them exceedingly well. At the annual LeadingRE conference held in Las Vegas in February, 2,000 participants from over 500 of the best independent real estate companies from across the country and around the world gathered to learn new things, exchange ideas and recognize the achievements of member companies.

Acton Real Estate came away with top honors for outgoing referral production and placed among the top 5 in 4 other categories. The company’s accomplishments made it rank 3rd overall among 130 partner companies of similar size.

Success in the networked economy requires that companies both compete and cooperate. Two authors on the subject of business management, Adam Brandenburger and Barry Nalebuff from Harvard and Yale respectively, coined the term co-opetition to describe the place where competition and cooperation merge to respond to a changing business dynamic. They published their work in 1996 just as this new paradigm was evolving; where “information, connectivity and time” began to define how business was conducted.

Consumers began to discover, and now take for granted that barriers to entry into the world of commerce were falling. They have come to expect that all buyers and all sellers have gathered to form the once only theoretical “perfect marketplace.” But membership in the interconnected world adds value to business transactions only when there is active participation. Joining is not co-opetition; relationships must be used to have value.

The active participation of Acton Real Estate in LeadingRE truly adds value to the service we provide to clients. In addition, the ongoing interaction with the best independent real estate companies around the globe continually strengthens those relationships. Being top of mind with real estate companies in Boston, Chicago or London is good for business and good for our clients and it’s what they should expect.

The Resident Expertsm are off to a great start in 2015, using their networking skills in every way to make sure the clients we serve are active players in the global marketplace.

February 18th, 2015

Who’s Looking Out for Me?


By: Victor Normand
Published: February 2015

Before 1990, the real estate agent who drove around with you looking at homes for sale, answered all your questions, supplied information about the house, wrote an offer, helped settle on a sale price, interpreted the home inspection and otherwise stayed with the transaction to closing was actually acting as the legal representative of the Seller, and not you, the Buyer. In fact all real estate brokers and agents in the Commonwealth of Massachusetts were duty bound to act in the best interest of their clients, the Home Seller. You would have been merely their customer.

Licensing law in Massachusetts required those brokers and agents representing the Sellers to adhere to the duties colloquially referred to as “OLD CAR”

o Obedience – Agent must carry out all lawful instructions of client.
o Loyalty – Agent must act in best interest of client.
o Disclosure – Agent must disclose all information relevant to client.
o Confidentiality – Duty to keep confidential client’s information or discussion.
o Accountability – Agent must protect and account for all money, documents, or other personal property given to her by the client.
o Reasonable Care & Due Diligence

Given the requirements of this agency relationship with the Seller client, you might be tempted to ask, “Who’s looking out for the Buyer?” And you would not have been alone on that point. The idea of Buyer Agents took hold in Massachusetts in the early 1990’s when licensing law was changed to allow for Buyer Agents. Some brokerages became exclusive Buyer Agents, serving only Buyer clients and some remained “traditional” brokerages representing Sellers as they had previously. But most real estate companies, including Acton Real Estate, became full service agencies.

So, how does the real estate consumer know who is representing them? Both the federal and state governments require brokers and their real estate agents to disclose the nature of the relationship with prospective clients up front, as soon as the first face to face meeting where a specific property is discussed in any detail, including inquiring about the list price.

To satisfy this disclosure requirement and to inform consumers, the Great Boston Real Estate Board created the Massachusetts Mandatory Licensee-Consumer Relationship Disclosure form and Certificate. The form defines each of the six types of relationships that may exist and requires the real estate agent to explain the difference and disclose which type is being offered.

Those different types are:

Seller’s Agent
Buyer’s Agent
(Non-Agent) Facilitator
Designated Seller’s and Buyer’s Agent
Dual Agent

Confused? You are not alone – in fact, unfortunately, many real estate agents do not handle this disclosure process correctly. Like most real estate companies these days, Acton Real Estate represents both Buyers and Sellers. This full service model is called Designated Agency where the ‘Old Car” relationship is established at the start between the client, whether Buyer or Seller and the Agent.

It can get complicated when the Buyer Agent and the Seller Agent involved in a transaction both work for the same real estate company. So, your best advice, as always, is to work with a Resident Expertsm who knows the law and has your back.

January 14th, 2015

Dealing with Stuff


By: Victor Normand
Published: January 2015

Sometimes the spring market for homes sales begins in February. If there is no snow on the ground and the sun is out, so are the buyers. Even if spring waits for the calendar, it’s not too soon for sellers to start getting ready. Preparing a home for market involves everything from dealing with deferred maintenance items, updating mechanical systems, remodeling in minor or major ways and considering the use of staging. All in all it can be a daunting but necessary undertaking. The first step however, which is often the least expensive but arguably the hardest to do, is getting rid of stuff.

Houses are bigger today by more than a factor of two since the middle of the last century and we have all taken advantage of that added space to accumulate stuff. Today the weight of household items for a typical four bedroom home is about 11,000 pounds compared to 2,500 pounds in 1950. Someday, someone will eventually deal with all of our stuff if we don’t take care of it. Moving to a new house, even if the new house is the same size as the old house is a good time to shed a few pounds.

Consider this; the cost to move one pound of stuff from Acton to Raleigh, N.C., a distance of about 600 miles, is about 75 cents. Getting rid of 10 percent of our stuff could save over $800 in shipping costs. And who doesn’t believe that we couldn’t lose that 10 percent without missing any of it and actually feel GOOD about living with a bit less clutter? Some experts say that most of us actually use only about 20% of all the stuff that we own. The de-cluttering concept is sound but the execution is difficult.

Here are a few ideas to get you over the hump and on your way toward minimalism:

• Get in the right frame of mind. Imagine your surviving family members going through your stuff and wondering why Grandpa would keep something like this? You don’t want to embarrass yourself posthumously; get angry and get going.
• Start at the end. Clean out the basement by just moving everything into the garage. See how great the basement looks? Now you are motivated.
• Get a sponsor. If it works for AA, it can work for de-cluttering. Find a friend to work beside you who is not connected emotionally to that old rocking chair with the broken seat. You don’t have to face this alone.
• Go with your inner self. If you are hyper-sensitive about parting with your belongings, focus on re-cycling if you can’t bear the thought of your stuff ending up in a dumpster. Hire a clean out company who promises to re-cycle “most” of the items they take away, and there’s always eBay, and the Virtual Garage Sale on Facebook where your “friends” get first dibs on your stuff.
(See the list below for some other options for re-purposing things)

Advanced Electronics Recycling
43 Broad St.
Hudson, MA 01749
Phone: 978-568-3444
Takes: Old computers, miscellaneous electronics, CRT monitors and TV’s.

145 Great Rd.
Acton, MA 01720
Phone: 978-263-6150
Takes: Desktops and all in one computers, laptops, tablets, ereaders, monitors, printers, copiers, scanners, faxes, shredders, UPS/battery backup devices, mice, keyboards, modems, routers, computer speakers, mobile phones, MP3 players/iPods, calculators, GPS devices, digital camera, camcorders, cordless phones, digital projectors, CD/DVD/Blu-ray players, gaming devices, A/V receivers, video streaming devices, cable/satellite receivers, external hard drives and small servers, rechargeable batteries (11 pounds or less)
Will NOT take: TV’s, floor model copiers and printers, appliances, large servers, large speakers or speaker systems, alkaline or lithium batteries, lamp and bulbs.

530 Main St
Acton, MA 01720
Phone: 978-635-1710
Donation Hours: Tues, Thurs & Sat: 9am-Noon
Takes: Metal bed frames, mattresses & box springs, dressers & bureaus, nightstands, kitchen and dining room tables & chairs, sofas &loveseats, sofa beds & recliners, coffee & end tables, dishes, glassware, pots & pans, flatware, cooking utensils, baking pans & casserole dishes, toasters & toaster ovens, coffee makers, mixers, blenders, countertop microwaves, sheet sets, blankets, comforters & towels, new or like new bed pillows, area rugs, framed prints, mirrors, fans, space heaters, vacuum cleaners, TV’s (10 yrs or newer, radios, irons & ironing boards, shower curtain liners, brooms & dustpans, small trash cans.
Will NOT take: Clothing or food

The Salvation Army
Phone: 1-800-728-7825
Takes: Appliances, automobiles, men’s, women’s & children’s clothing, furniture, household goods, miscellaneous items
The Salvation Army provides receipts for tax deductions

Phone: 877-545-4113
Takes: Old or second refrigerator & freezers. Must be between 10 and 30 cubic feet using inside measurements, cannot be your primary refrigerator or freezer, clean, empty and in good working order, accessible with a clear path for removal. You MUST be an NStar customer. Offers Rebate.

Mass Save
Phone: 877-545-4113
Takes: Old or second refrigerator & freezers. Must be between 10 and 30 cubic feet using inside measurements, cannot be your primary refrigerator or freezer, clean, empty and in good working order, accessible with a clear path for removal. Offers Rebate.

Kars 4 Kids
Phone: 1-877-527-7454
Takes: Cars, boats and water craft, motorcycles and dirt bikes, RV’s, campers, and trailers

Boston Building Resources
100 Terrace St
Boston, MA 02120
Phone: 617-442-2262
Takes: Cabinets, countertops, sinks & faucets, appliances (showroom condition, less than 5 yrs old), vanities, tubs & enclosures, low-flow toilets, ceramic tiles, accessories (towel racks, etc.), lead paint free windows (vinyl & wood replacement, insulated double hung units, awning & hopper), lead paint free doors (interior minimum width 30”, exterior, storm doors with frame & hardware, locks, knobs , hinges), dimensional lumber (6’ min. length, no scraps), moldings, plywood (half sheets or larger), drywall (half sheets or larger), exterior house shutters (wood, no lead paint), carpeting & carpet tiles, ceramic & vinyl tile, sheet vinyl, wood flooring, residential surface-mounted light fixtures, paddle fans, latex paint (full containers, cans must be clean and paint in good condition)
Call for items they will NOT take

Books: Can be donated to the library, Salvation Army, HGRM, or any of the book drop off boxes that are located throughout town.

For many, the task may appear difficult at the beginning, but as they progress, the process of tossing out stuff can feel exhilarating. I feared the roller coaster as a kid, but I kept getting on and soon began to crave the thrill of being momentarily weightless.

And then there is the joy that comes with starting over. I knew a man who was only able to save a few family albums when his house burned to the ground. Afterwards when a reporter asked him what it was like to lose everything he thought for a moment and simply said “liberating, in a way.”

So, consult with a Resident Expertsm on everything you need to do to prepare your house for the spring market, even if it’s the spring market next year. Start off by not purchasing anything new, even if it is on sale, and then digging in to that collection of stuff. You will feel so good when it’s done!

December 18th, 2014

Holiday Reflection


By: Victor NormandGhost with Scrooge
Published: December 2014

At the end of A Christmas Carol, Charles Dickens describes the change in his main character: “Scrooge was better than his word. He did it all, and infinitely more; and to Tiny Tim, who did not die, he was a second father. He became as good a friend, as good a master, and as good a man, as the good old city knew, or any other good old city, town, or borough, in the good old world.”

Scrooge had his epiphany because of a piece of undigested beef (or it might have been too much to drink) that caused ghosts to show him what he should have known of his poorly led life and what he needed to do to turn things around. It feels good to be reminded that we all have choices and opportunities to embrace the true spirit of the holidays.

In real estate we live in a very material world. Our work is in the main, defined by land and buildings and everything affixed thereto. But as anyone who toils in these fields knows, attachments with real people are formed every day. We strive to know our clients and their most important physical needs. We build relationships with service providers and vendors and we rely on the efforts and experience of our associates in the office.

We would all like to be known as good people throughout our lives, both now and after we have gone to that last and final “Open House.” When you think about it, it does not take all that much to be known as a good and honest person, so long as we are true to ourselves. In our hearts and minds we always know the right thing to do, keeping faith with the right thing to do is sometimes a challenge.

Scrooge and his business partner ran a nineteenth century financial institution, then called a Counting House, which today we might call a private bank, and money lending is what they did. The image of Scrooge, if not the name itself may have come to the minds of first time home buyers or sub-prime borrowers these past several years. And it is hard to imagine anyone having the serenity of Bob Cratchit who could count his blessings amid poverty and personal hardship.

But by the end of the story, things had gotten better. Scrooge changed his business model, his debtors got relief, Bob Cratchit got a raise and a fat goose to boot, and Tiny Tim’s future was much brighter. Redemption for Ebenezer Scrooge was at hand and Dickens hoped his little story would find its way into all our hearts.


November 17th, 2014

Disclosure of Death, Crimes and Ghosts


By: Victor Normand
Published: November 2014

112 Ocean Avenue, Amityville, New York

In all states, home sellers and their real estate agents are obligated to disclose known material defects like a leaking roof or an inoperable heating system in a property for sale. Material defects are defined as those conditions that could affect the value of a home. In Massachusetts, the Consumer Protection Act, Chapter 93A, requires such disclosure even if a potential buyer does not ask. Failure to disclose material defects could subject the agent to treble damages, plus legal fees. But the question is, can matters of an intangible nature be considered material?

Can the fact that crimes, like murder or the presence of a ghost or other paranormal event, psychologically stigmatize a property as to materially affect its value? The fact is that one in four Americans is superstitious and there are several examples of severely depressed values on stigmatized properties. The former home of Nicole Brown Simpson where she and a friend, Ronald Goldman were murdered, sat on the market for two years and eventually sold for $200,000 less than the asking price. State laws on disclosure vary widely.

In Tennessee there is no duty to disclose, and a real estate agent who does disclose such stigmatizing information without permission can be held liable for breaking the fiduciary relationship between the seller and the agent. In California the law does require disclosure for deaths at the property, but only if the death occurred within the last three years, and was not AIDS related. In Massachusetts, there is clarity on the subject.

While Chapter 93A would seem to require full disclosure, the legislature created an exception by passing the “Stigmatized Property Law.” The law states that whether a property is “psychologically impacted” is not a material fact that requires disclosure. However, if asked by a potential buyer about a crime or death of an occupant, the real estate agent must respond accurately as to what is known. There is no duty to volunteer any information, but if asked, the agent must disclose. There is no obligation on the part of the agent to investigate and the potential buyer’s questions should be referred to the local police department.

By extension, paranormal events that may stigmatize a property; think The Amityville Horror, need not be disclosed voluntarily, but should be addressed if asked. In New England where homes are much older than other parts of the country, there may be no knowledge on the part of the current owners of what may have happened in the house 50, or 100 or more years ago. And then there is the issue of what situation might exist in the neighborhood.

Courts have suggested in certain cases that there may be no need to disclose non-physical “transient social conditions” in a neighborhood. The matter of sex offenders living nearby presents both a legal and ethical/moral challenge for real estate agents. While sex offenders are not of themselves a protected class like minorities, children, or the handicapped, the best advice for a real estate agent is to disclose.

Real estate agents representing Buyers and Sellers need to know the laws and act accordingly in all matters relating to disclosure. Private sellers on the other hand are not required to disclose anything, other than the presence of lead paint. They have no duty to disclose things like the condition of the roof or the presence of ghosts, which makes using the services of a Resident Expertsm always the right thing to do.