Big Battery-Electric Trucks Are Coming Soon

Previously I wrote about 2021 being “the year of the electric pickup.” Well, this year is also going to see the arrival of multiple box trucks, buses (including school buses), and big rigs with electric drive trains.

Rivian is already delivering on its order of 100,000 electric delivery trucks for Amazon, shown here. Nikola has an order from Republic Services for 5,000 trash trucks using the same platform as their semi tractor (below). Even Detroit Diesel, despite its name, is going to be producing a battery-electric semi tractor (also below) for its biggest customer, Freightliner.

The Tesla Semi (bottom) begins production by the end of 2021. Introduced with great fanfare in 2017, it has been field tested, I’m told, delivering trailer loads of Tesla cars to local Tesla stores. One was spotted last year at the Littleton store.

Want to keep up with EV news? Subscribe to a great weekly newsletter at www.GreenCarReports.com.

Nikola semi tractor
Detroit Diesel electric tractor schematic
Tesla Semi

NAR’s ‘Clear Cooperation’ Policy Is a First Step at Eliminating Pocket Listings

A “pocket listing” is a property which the listing agent does not put on the MLS, hoping to sell it himself or get it sold by other agents in his office. It’s not typically in the best interest of the seller, since the property is withheld from the full universe of potential buyers.

The organizing principle of the Multi-List System, or MLS, is “cooperation and compensation.” Every real estate agent working in the public arena needs to belong to the local MLS, because it’s only through the MLS that the agent can show and sell that MLS’s listings and be guaranteed the “co-op” commission displayed on the MLS.

A listing agent, naturally, would prefer not to give a big slice of the listing commission to the “cooperat-ing” broker who brings the buyer. He or she would much rather sell the listing, keeping the entire commission for him or herself. Meanwhile, other agents (and their buyers) are upset when they don’t have the opportunity to show a new listing and submit an offer, especially when there are so few listings on the market, as is currently the case.

The National Association of Realtors (NAR) took up the issue of pocket listings last year when it adopted a policy called Clear Cooperation. Essentially the policy says that if an MLS member advertises or promotes a listing in any way — including putting a “coming soon” sign in the yard or mentioning it on social media — that listing must be entered on the MLS within 24 hours. It can be listed as “coming soon” on the MLS, during which time it can’t be shown, including by the listing agent. Once it is shown, it must immediately be changed to “active,” allowing all MLS members to show and sell it.

Unfortunately for sellers, who are the big losers with pocket listings, this policy will never be completely effective. That is evident from the fact that over 7% of listings, by my count, are entered on the MLS only after they are sold. Unless a home remains active on the MLS for 3 or 4 days, it’s unlikely that all potential buyers will have had a chance to compete for it.

You may recall the featured listing in last week’s column. It was listed at $375,000, a price consistent with comparable sales, and we received a full-price offer on the first day. Our policy, however, is to get our sellers to wait four days before going under contract. We had 30 showings and received six offers by day four. By being transparent about the offers received, we were able to bid up the property by  more than $55,000 by day four. We did get an offer $35,000 over listing price on day two, but we waited. Our seller benefited from waiting 2 more days.

Sadly, most listing agents haven’t adopted this practice. They sell their listings too quickly, potentially costing their sellers thousands but also frustrating would-be buyers who might pay more. 

I have calculated that in addition to the 7% of listings being sold with zero days on the MLS, 15% are sold after only 1 or 2 days on the MLS.

One technique for minimizing showings by other agents has been to make a listing “active” but block showings with the showing service. Because the listing is “active,” the listing agent can show the property him or herself without technically violating the clear cooperation policy.

Another technique is the “office exclusive” option.  A listing can be marketed within a brokerage without putting it on the MLS. But once any kind of public marketing takes place, the listing must immediately be put on the MLS as either “coming soon” or “active.”

Division of Real Estate Warns Homeowners About ‘Equity Skimming’ Schemes

By now, we should all be wary of people offering to “help” us financially, usually via the internet or email, but also by phone.  As the saying goes, “If it sounds too good to be true, it probably is.”

Last week the Colorado Division of Real Estate (DRE) issued a warning about scammers cheating homeowners out of their home’s equity on the pretext of helping them pay HOA liens on their home.

Yes, an HOA can place a lien on your home for failing to pay your HOA assessments or fines, and an HOA lien takes priority even over the lien of your mortgage lender.

It is possible for an HOA to foreclose on your $600,000 home because of unpaid dues or fines, no matter how small. But if you can’t pay, what do you do? Those liens and subsequent foreclosure actions become public records, making you an easy-to-find target for a scammer wanting to “help” you.

Here’s a link to the full DRE warning. It describes several scamming scenarios. According to the DRE’s warning, those scenarios “can leave a homeowner losing their property, becoming a renter in their own home, having their credit rating severely damaged, and having the possibility that the lender may pursue a deficiency judgment against them if the property is foreclosed upon, as well as the HOA pursuing a personal judgment against them for unpaid HOA dues.”

Homeowners are urged to look for the following red flags:

>  Anyone wanting you to act fast with a quick-fix to your financial difficulties.

>  Promises to resolve your financial problems and to leave your cares behind.

>  Someone wanting you to transfer your ownership in the property to them.

>  Anyone asking you to sign a power of attorney for them to act on your behalf.

> Proposing that you’ll be a tenant in the home that you now own.

>  Someone telling you that there is no need to consult with an attorney, accountant, real estate broker, lender or anyone else.

Feel free to contact me if you find yourself in this or a similar situation. My intention is not to convince you to list your home with me. I just want to give you my own layman’s feedback on what others may have told you, and I can, if appropriate, refer you to a trusted real estate attorney. First, however, read that DRE warning, which has lots of useful information and links for reporting suspected scams or getting other advice.

And, as I like to say, remember that “Google is your friend.”  When contacted by someone you suspect could be a scammer, do a web search for the person and/or company and/or email address and/or phone number. Also, we have a special app called “Forewarn,” only available to licensed Realtors like myself, where I can instantly search by name or phone number. My broker associates and I use that app to check out people who want to do business with us, instantly learning their age, properties owned, bankruptcies or liens, criminal charges, and even cars they own.  I’m happy to do such a search for you, too.

Lastly, I’d like to put in a good word for my cell carrier, T-Mobile.  My previous cell carrier was AT&T, which didn’t provide Caller ID on people not in my contact list, but I do get Caller ID with T-Mobile. If a number does not have a name associated with it, I let it go into voice-mail, and those callers rarely leave a message, suggesting, I believe, that it was a “spoofed” number by a solicitor or scammer. Thank you, T-Mobile! I’m wasting a lot less time than I used to on answering unwanted calls.

‘Equity Sharing’ Concept Not as Smart as a Home Equity Line of Credit

A reader brought to my attention a company called Noah (formerly Patch Homes) which offers an alternative to the Home Equity Line of Credit (HELOC). What they offer is a way of tapping into your home’s equity for needed cash in return for a percentage of your home’s equity — reportedly between 15 and 40%. You don’t pay for this “loan.” Rather, Noah shares in your home’s appreciation (or loss of value) when you sell.

While I don’t consider Noah’s offer a scam, I think it should only be considered as a last resort. In the long run, a HELOC is a much better way to access the equity in your home, and credit unions are the best places to secure such a loan, in my experience. Here’s a third-party review of Noah’s “equity sharing” concept.

2021 Will Be the ‘Year of the Electric Pickup’

The best selling vehicle in America for many years has been the Ford F-150 pick-up, so 2021 is bound to be a watershed year, given the number of electric pick-up trucks expected to hit the market — including, by the way, an electric F-150, which has been teased for at least a year.

Rivian is furthest along and will beat Tesla’s entry by several months. Rivian is simultaneously releasing an SUV and 4-door pickup, which appeal to the same demographic. The company is backed by Amazon, which has boosted Rivian’s financial situation by ordering 100,000 delivery vehicles to replace the blue Amazon vans we see every day in our neighborhoods. Some of them are already in service, but not in the Denver market. You may have seen an Amazon commercial featuring the new van.

Ford F-150 Electric

The F-150 Electric begins production this year. Tesla’s Cybertruck may be in production by year’s end but certainly in 2022.

Also coming this year (or soon) are GM’s Hummer EV, the Atlis XT, Bollinger’s B2, and more. Click here for ChargePoint’s article with specs and prices on these six trucks. Click here for InsideEVs.com’s list of all the electric trucks they are expecting in 2021 and 2022, including the above six trucks plus the Lordstown Endurance, the Chevrolet BET, Nikola Badger, Hercules Alpha, and Fisker Alaska. Nissan is reportedly considering hiring Hercules to create an electric Nissan Titan.

Tesla Cybertruck

Amazon van by Rivian – already in production and in service

GM’ Hummer EV

Atlas XT

Lordstown Endurance

Bollinger B2

Nikola Badger

Hercules Alpha

Fisker Alaska

The Good, the Bad, and the Ugly About Mortgage Loan Forbearance

A record number of homeowners entered into a forbearance plan for their mortgage over the past year amidst the Covid-19 pandemic. Forbearance — an option that allows borrowers to pause payments on their mortgage for a limited amount of time due to an unforeseen hardship — served as a veritable lifeline for many people who found themselves unexpectedly out of work and unable to pay their mortgage as COVID restrictions tightened.

As more time passes, however, it is apparent that issues stemming from forbearance are starting to surface. While this is not an immediate cause for panic if your own mortgage has been in forbearance, being aware of issues that others are facing will help to keep you prepared for any trouble that arises.

For that reason, I had a Zoom meeting this week with Jaxzann Riggs, owner of The Mortgage Network in Denver, to learn more about complications that forbearance may bring about.

When the CARES Act was initially passed back in March 2020, it included a provision for mortgage forbearance, making it relatively easy for millions of borrowers with government backed mortgages to enter into such a program. Fannie Mae and Freddie Mac, the two largest servicers of government backed loans, subsequently issued an extensive list of guidelines for lenders in response to Covid-specific forbearance.

One of the most crucial guidelines involved credit score reporting. An account in for-bearance must continue to be reported as current, provided it was current prior to the forbearance plan. Due to the vast number of people who entered into forbearance in such a short time period, it is especially important to monitor your credit score — but that is not necessarily the end of the story.

Some borrowers who were previously in forbearance that are now applying for new loans are discovering that their issue does not lie with the credit reporting bureaus themselves but with the underwriting on their new loan. Underwriters, who are primarily responsible for qualifying a borrower for a loan from a specific lender, have a significant amount of discretion when it comes to approving an application. The consequence of this is that borrowers who would otherwise be well qualified to purchase — with high credit scores, steady employment, and a significant down payment — may find themselves struggling to obtain the loan they are seeking if they previously had a loan in forbearance. Although Fannie’s and Freddie’s guidelines include specifics for underwriting, the sometimes unfortunate reality is that these guidelines can be interpreted differently by different underwriters.

If you had a loan in forbearance sometime this past year and are now considering a new purchase or refinance, you should not immediately despair. Maintaining meticulous records that indicate when you initially applied for forbearance and being able to produce all communications with your current lender to the new lender are essential. If you have entered the repayment phase of the loan it is critical that the repayment agreement is followed exactly as written.

Because forbearance was originally intended to help those that had a loss of income or employment due to COVID, underwriters are scrutinizing employment history and the likelihood of it continuing for all borrowers. Borrowers that did not have any change in employment status during the pandemic but who entered into a forbearance agreement should be prepared to outline for the new lender their motivations for entering forbearance and to additionally explain how they will be able to avoid forbearance in the future. This is a bit ironic, in that lenders strongly encouraged many to utilize the options afforded them under the CARES Act. If you have questions about how forbearance may impact your future lending, I recommend, as always, that you consult Jaxzann Riggs of The Mortgage Network. You can reach her anytime on her cell phone, 303-990-2992.

DMAR Reports Average Home Price Rose by $100K in Last 12 Months

The Denver Metro Real Estate Market Trends Report, released on February 3rd by the Denver Metro Association of Realtors, reveals that detached single-family homes in the metro area set yet another record for average price, exceeding $629,000 in January. Attached single family homes (condos & townhomes) rose by less than half that amount, as shown in the above chart. Download the full report here.

Reader response to Jan. 27th posting about racism’s role in the evolution of local zoning

An Arvada reader thanked me for that earlier post and asked if I was aware of the 1898 “coup” in Wilmington, North Carolina. (I wasn’t.) I found the following article on History.com which described it as “America’s only successful coup d’etat.” Here’s a link to it.

What Defines a Bedroom? Neither the Real Estate Commission nor MLS Will Say

As a broker, I get to decide what constitutes a bedroom. We get no guidance or rules about that from either our MLS (REcolorado) or from the Colorado Real Estate Commission.

This week’s featured listing is a good example. When my seller purchased the condo in April 2017, it was advertised as a 2-bedroom unit, which is what the county assessor calls it. But that “second bedroom” has no window and no closet, measures only 9’ by 10’, and has double glass French doors between it and the kitchen area.

I could not in good conscience market that condo as anything other than a one-bedroom unit with a study.

I could “get away with” marketing the study as a “non-conforming” bedroom, but there are no definitions for that term, either. The term “non-conforming” is most often used for basement bedrooms which don’t have egress windows, although I’ve only used it when, for example, there was no bathroom on the same level or no door giving the room privacy.

On the other hand, I have seen basements listed as having a bedroom when the only door to that bedroom was the door at the top of the stairs. The most outlandish example I can recall was when an open loft overlooking the living room was listed as a bedroom, perhaps because there was a closet — but the nearest bathroom was downstairs. 

I don’t sense any interest on the part of the MLS (on whose Rules & Regulations Committee I have sat for over a decade) or the Colorado Real Estate Commission (to which I’ve applied for appointment) to come up with a definition of “bedroom.” As with other terms such as “raised ranch” or “garden level,” it’s left to the managing brokers (like me) or the listing agents themselves to decide how to describe the homes they market, and it’s up to buyers to make their own decisions to buy a home, irrespective of how it has been described on the MLS.

So, for what it’s worth, here’s my definition of a bedroom: It must have walls (no open lofts!), a window to the outdoors, its own door to common space, a 3/4 or full bathroom on the same level, and, optionally, a closet. The window does not have to qualify as an egress window. The closet is optional only if the room is big enough to allow for a piece of furniture (a wardrobe or armoire) that can serve as a closet. It has to be big enough to support a bed and dresser without being crowded (at least 9’ by 12’ or about 100 square feet).

It’s a judgment call as to whether a room without all those criteria should be called a “non-conforming” bedroom. I do take stock of whether the county assessor calls it a bedroom, but, as I said, the assessor called the study in my condo listing a bedroom, probably because the builder called it that on their plans. (Builders, like brokers, have their own ways of seeing things, and no one is there to contradict them.)

Buyers ask to see a listing based on its description in the MLS, and I’ve had a buyer get really annoyed when we went to see a 3-bedroom home (which was their minimum requirement) only to discover it was a 2-bedroom home. I shared that buyer’s annoyance in the feedback I provided, but that listing continued to claim three bedrooms.

Some brokerages contribute to the problem of inaccurate property descriptions by not allowing broker associates to enter and manage the MLS data for their own listings. That’s not how Golden Real Estate operates. As managing broker, I want my broker associates to enter their own listings on the MLS, and I usually will look at those listings and give my feedback or make changes directly on the MLS, which I’m able to do as their managing broker.

We have an office policy of providing maximum (not just accurate) information on each listing. That means entering data in all applicable MLS fields and not just  the mandatory ones. Many optional fields are quite important, not just useful, to buyers. These include each room’s dimensions and a general description of each room. A quick check of 71 current listings in Lakewood showed that only 13 of them included room dimensions and descriptions. A couple of them only listed bedrooms and bathrooms, not living rooms, kitchens, and other rooms. That’s because you can no longer just indicate the number of bedrooms and bathrooms, you must list each of them and the floor they are on, but you don’t need to enter dimensions or descriptions.

To me, describing the rooms is just as important as the “public remarks,” which is that one paragraph which you read on all the consumer websites to which each listing is populated (Zillow, Redfin, etc.). In describing each room, we like to list the floor covering (hardwood, tile, etc.) plus things like the view out the window, coved ceiling, ceiling fan, walk-in closet(s), access to deck or patio, fireplace (gas or wood), en suite bathroom, wainscoting, and more.  Sellers deserve no less.

Room dimensions and descriptions help to sell a home, so we owe it to our sellers to take advantage of that opportunity. It’s a shame that the majority of listing agents leave these non-mandatory fields blank.

Reader Comment on Last Week’s Article About Racism & Zoning

    Your article was very interesting and timely as we must be reminded of our country’s systemic racist policies that contribute to the discord we experience today. I have a couple of other examples. 

    First, the FHA was the driver for much of the single family homes constructed in suburbia during the ’50s and ’60s.  Its underwriting policies in the early days, mandated that “the neighborhood be homogeneous (seg-regated), with that homogeneity preferably assured through racist restrictive covenants, for which the FHA helpfully supplied forms,” according to Michael Carliner, Development of Federal Homeownership Policy, as quoted on page 96 of Concrete Economics by Cohen and DeLong in 2016 . 

    In addition, I’ve read, but cannot remember the source, that the VA lending policies were similar. As a consequence, black GIs returning home, could only get loans for properties located in black communities (inner city residences) and thus were not able to build up the equity in their homes like the white GIs who were able to buy new homes on the large lots in suburbia.

     This “homogenous neighborhood” requirement in federal lending practices prevented the mixing of the races in modern America, contributing to the racial divide we experience to this day.                          —Michael Nosler