On Top of the Aloha Beat BLOG

I went down to the Lihue Business Association meeting this past Thursday morning to "talk story" with the two mayoral candidates who are left standing after the prior week's primary. And different they surely are. Bernard Carvalho is a former football player, the head of our parks and recreation department, and has served the county for 23 years. Joanne Yukimura was mayor during Hurricane Iniki, and has served for fourteen years on the county council. Joanne is a Stanford graduate and a really, really intelligent woman.

Joanne clearly has a cogent understanding of the issues and the political experience yet Bernard had the support of the former mayor, Bryan Baptiste, who suddenly passed away not that long ago.  Bernard constantly stated at this breakfast meeting that his style of leadership was inclusive and that he was an good listener to hear what the people wanted. Yet, like so many politicians, and even the presidential debate last night, when the people at the roundtable asked questions, it did not seem like they were heard. Now i admit, I'm an auditory guy, and thusly, very literal. However, when someone tells me he is a good listener, and demonstrates his inability to discern the information, I have cause for concern.

Each candidate sat around a table of business people for around 20 minutes, then switched to the other table. Someone asked Joanne Yukimura,

 What are your thoughts on the role of county regarding decreasing cost of our energy.
She answered: We need to create  a plan for the island. Create a roadmap for energy independence. Big Island has done their plan already.  We must figured out what are the opportunities and what are the obstacles.  Like Stephen Covey says, “What is our end in mind”. Everyone will have a kuleana. KIUC( our electric utility) will have a role. County will have a role and so will business. We could have  a United Way type meter to show our progress. We need to place incentives in the right place and disincentives for bad behavior.

I'm not sure if Joanne can win as she is clearly the underdog. If she does not, I'm not sure the county of Kauai will be making any paradigm shifts any time soon.

Both candidates talked about "smart development". I hope they know what that means. A lot of islanders would probably agree that there has been a lot of "dump development" on Kauai. To maintain the rural quality, the development must be clearly managed. Right now, the entire economic system is taking care of that. In the future, once this mess is behind us, developers will one day come roaring back I am sure.

My good friend Ken Stokes who runs the SUSHI blog just posted his video presentation which was given to our Kauai County Council at the end of last year.  He was invited by Councilmember JoAnn Yukimura, who is currently running for Mayor,  to make the same presentation to the County Council that she had seen him give as the keynote for the Kauai LEGS Sustainability Conference.

This presentation introduces the ‘new story’ of the three spheres.

It’s called “Kauaian Sustainability: It’s not what we think, it’s how.” Watch it!

Ken drives his electric bike around the island to help maintain and reduce his carbon footprint. The video quality is not that great, but it's the content that counts. Remember, this is nine months old, yet so completely contemporary. This guy completely lives this stuff. If you haven't paid attention to much of this stuff, you will certainly find Ken's information worthwhile and sincere.

Our senior broker sent an email today reminding us to be careful. In these uncertain times, strange things can and do happen.

Liability for Inaccurate Square Footage

A Texas court has considered whether a listing broker was liable for providing inaccurate square footage information.

Jason and Ashley Bradford (“Buyers”) became interested in a home owned by John and Beatrice Vasquez (“Sellers”). The Buyers had determined that the property had a lower per square foot price than other similar properties by using the property’s information provided in the multiple listing service (“MLS”). Margaret Pleasant (“Salesperson”) of Mark Bowles d/b/a Prudential Synergy REALTORS® (“Brokerage”) was the listing representative for the Sellers’ property.

The Salesperson had obtained the property’s square footage information from the Bell County Appraisal District, a local government agency. The Brokerage’s usual practice was to indicate in the MLS the source of the square footage information, but allegedly did not in this instance because of a clerical error.

The Buyers visited the Sellers’ home, after which their real estate representative, Angela Bruce (“Buyer’s Representative”) asked them to sign a release (“Release”) stating that they had not relied upon any statements “made by the REALTOR and his/her associates”, and only relied upon information received from the sellers, third parties, or information that the buyers had independently verified on their own. Both the Buyer’s Representative and the Salesperson were members of a REALTOR® Association. Both the Buyers and Sellers also signed this form.

The Buyers made an offer for the property and the Sellers accepted it. Five days after the closing, the Buyers received a copy of the appraisal report prepared by their lender’s appraiser and learned that the property was 253 feet smaller than had been listed in the MLS. The Buyers filed a lawsuit against the Salesperson and the Brokerage. The jury found that the Salesperson had violated the Texas Deceptive Trade Practices Act (“Act”) and awarded the Buyers damages. The Salesperson and the Brokerage appealed.

The Court of Appeals of Texas, Austin, affirmed the trial court. The Salesperson and Brokerage first challenged the Buyers’ reliance upon the alleged misrepresentation. “Reasonable reliance” is a necessary element for a consumer fraud complaint, requiring that a party not ignore information which would cause him/her to question the truth of the facts upon which he/she is relying. While both Buyers had testified that square footage cost had been a key technique they used for identifying suitable properties, they also testified that: they had had lived in the home thirty days prior to closing; they had also visited the same government agency website where the Salesperson had obtained the erroneous square footage information; and the Buyers had signed the Release.

The court rejected the argument that the Buyers living in the property prior to closing should have alerted them to the property’s actual size. This argument was based on the fact that the Buyers had made repairs on the property, and so they would have measured these areas during the work. The court found that while living on the property would have given the Buyers the opportunity to investigate the actual square footage for the property, it did not impose upon them to do so and did not destroy their reliance on the erroneous figures provided by the Salesperson.

Next, the court examined whether the Buyers visiting the government appraisal website destroyed the Buyers ability to claim reliance on the information provided by the Salesperson. The Salesperson argued that the website visit by the Buyers showed that they were investigating the accuracy of the square footage information. The Buyers countered that they did not go to the government website to confirm the square footage information; instead, they went to the website to learn other details about the property, such as tax information. The court found there was no evidence demonstrating that the Buyers had independently verified the square footage information, and so the court denied this argument.

Finally, the court considered whether the Release protected the Salesperson and the Brokerage, since they were also REALTORS®. The Release was printed on the Buyer’s Representative’s letterhead. The Buyers also testified that the Sellers had not yet signed the form when they (the Buyers) received it, and they understood the form to only cover the Buyer’s Representative. The court found that the jury had evaluated the evidence and its conclusion was supported by the evidence, and so the court dismissed this challenge as well.

The court also upheld a challenge to the damages awarded in this case, which the jury had computed by looking at the difference between what the Buyers thought they were getting in square footage and the actual square footage. The Salesperson and Brokerage tried to show that the jury had improperly arrived at the damage figure because there were conflicting expert opinions, but the court ruled that the jury had sufficient information to arrive at the damage figure. Thus, the court upheld the award.

Pleasant v. Bradford, No. 03-07-00167-CV, 2008 WL 2544814 (Tex. App. June 26, 2008). [This is a citation to a Westlaw document. Westlaw is a subscription, online legal research service. If an official reporter citation should become available for this case, the citation will be updated to reflect this information].

On our island, we are and have been, the company with the largest aggregate of business. The other major franchises, Prudential and RE/MAX, all have some presence on our small Garden Island BUT, they don't produce the numbers that we do. And that brings me to our broker. Ken Kubiak LOVES to produce sales charts.

Here's a recent one based on sales this year viewable in the MLS through Sept. 16, 2008. Note how dominant our number one position is. It simply means that in a small market, we have the largest number of agents that represent the largest number of buyers and sellers. Thanks to Richard Dolbeare from our Koloa office for the nice graphic treatment of broker Ken's chart of activity. Our office, based in Kapaa, also has a dominant share of marketplace on the east side of the island. That rock's

Although i do a lot of internet marketing, blogging, twittering, uttering and well... you name it, I have found since moving to Kauai that sitting OPEN HOUSE is also a very viable, active marketing technique that works in the Hawaiian Islands. Simply because the buyers are already physically here on the island. And tht's a super big plus. Anyway, when i do an open house i:

1. Advertise them in the Kauai real estate Weekly
2. Post them on Craigslist and Openhouse.com
3. E-mail blast the realtor community.

C21 is big on OPEN HOUSE. In fact, October is Century 21 Open House Month. This is a great opportunity for brokers and agents to promote current listings and expand their listings of potential buyers and sellers. Learn how you can use technology to promote your open houses. Attend this webinar on October 3rd at 1:00pm Pacific Time. I believe you must be a C21 agent to participate. The last few webinars have been great so I'd recommend checking it out Register now by clicking here <https://vovici.com/wsb.dll/s/d51g3745f> .
 
 Don’t miss this information packed webinar in which you will learn:
Ø  How to market your open houses online including: Myspace.com, Meetup.com, Blogging, YouTube, etc.

Ø  Elements of a successful open house.

Ø  Open house tips and tricks.

 
Holding an Open House is a great opportunity for:
Ø  Brokers and Agents to promote current listings, meet potential buyers and sellers, and raise local awareness of their business.

Ø  Consumers to get extra exposure for their property, and learn what’s available in their market.

Ø  Open Houses to receive traffic, most that potentially will be buying or selling in the near future.

If you have a c21online account, 
copy this link to your browser: http://www.21online.com/project.web/openhouse/openhouse.aspx  to access and familiarize yourself with the materials for October Open House month.

3 Great Listings - Extraordinary Owner-financed Land, Kapa`a Home & Kauai's least expensive one bedroom condo.

Owner financing NOW AVAILABLE for this special Kilauea parcel of land. Not just another beautiful acreage, this land needs a steward of the aina to respect and appreciate this precious property where ancient Hawaiians lived and farmed on terraces above the beach. Walk the jungle garden to waterfalls and see for yourself that this fertile spot would make an ideal private retreat or compound for someone appreciating the stunning views and proximity to a great swimming and surfing beach. VIEW THE MLS LISTING of this special location.
VIEW THE VIRTUAL TOUR OF this seller-financed gorgeous land

4811 Ohu Rd. is a sweet 3 bedroom/2 bath home with a great master suite and deck off the
master for comfy outdoors living. Priced to sell at only $465,000.
VIEW THE VIRTUAL TOUR OF 4811 Ohu Rd. in Kapaa

Plantation Hale G11
Believe it or not, this IS the LEAST EXPENSIVE ONE BEDROOM Fee Simple CONDO on Kaua`i. A short walk from the ocean and across the street from the Coconut Marketplace, Plantation Hale G11 is a sweet and nicely decorated 633 sq. ft with lots of storage, a breakfast bar, and a large deck near the pool with an ocean view. Unit is Co-listed with Katerina Norman, RA, a great new agent who has joined our team. If you want great value on Kaua`i, we've got it!


VIEW THE VIRTUAL TOUR OF Plantation Hale G11 in Kapa`a

Kauai Property Tax Reform - What and When?

Real Property Tax Reform Bill 2274 was introduced this summer and is an issue of interest and concern to Kaua`ians and absentee owners alike. Download the 147-page bill to read it.

You can also download video from the county's website and a slide presentation of the key points. Two proposed changes include raising the tax exemption amount for fulltime residents, and designating a special "resort tax" for those property owners who vacation rent out their properties here. When I first arrived on Kauai in 2004, the real estate market was in a huge upswing. I saw transactions where the selling price was sometimes 3 times the assessed value of the property being sold. Now after 2+years of market correction, many homes are selling at or below their assessed values. Needless to say, assessed values went up with the real estate market as the tax assessors finally caught up to the racing market.

It's important for second home owners to know the implications of the new taxes since it will certainly affect any cash flow projections of ownership on Kauai if you plan to rent your property out when you are not on island.

We will keep you posted on these developments!

For the second sales meeting in a row, our brokers spent significant time reviewing Act 137, the new short sale law that went into effect in June of this year. This law, not sure how many states have a law like this, prohibits realtors from acting as "distress property consultants" and tells us what we can and cannot do. We CANNOT negotiate on the clients behalf. This seems so limiting to have prohibited realtors from assisting their clients while lenders, accountants, attorneys and the like can.

Do any of you live in a state where realtors are prohibited from helping in this way? Perhaps you can share your experience with me from Hawaii or another state with the most diligent way to serve a seller when doing a short sale.