The U.S. Supreme Court decision regarding the Defense of Marriage Act (DOMA), the Biggert-Waters Flood Insurance Reform Act of 2012, and the amended Rental Permit Law in effect in the unincorporated areas of the Town of Southampton, could affect the real estate market in the Hamptons, on the East End of Long Island, and elsewhere.
Biggert-Waters reauthorized the National Flood Insurance Program for an additional five years. It also increases the premiums to be charged for flood insurance as determined by FEMA, the Federal Emergency Flood Insurance Administration. The increases may be significant. The National Association of Realtors offers guidance for real estate brokers in connection with the marketing and sale of properties for which flood insurance may be required or prudent. The NAR provides a Sample Flood Insurance Disclosure Statement for real estate brokers and agents.
The Supreme Court ruling, which now recognizes marriages between same-sex couples in states that permit it, New York being one, has many practical consequences for these couples. One is, eligibility for the married couple filing a joint tax return exemption from up to $500 thousand of the capital gain on the sale of a property used as a primary residence for any two years of the five years prior to the sale. The property may be owned by either spouse and both would be eligible for the exemption as long as they file a joint Federal Tax return.
For landlords and tenants in the unincorporated portions of the Town of Southampton, the Rental Permit Law now prohibits rentals of fewer than fourteen days rather than thirty. It also gives landlords who have permitted occupancy without the required permit issued by the Buildings Department to apply for the permit without penalty under proscribed circumstances spelled out in the law.
A law pending before the New York Legislature would emulate Human Rights Law in New York City which prohibits discrimination with certain exceptions based upon lawful source of income, including the Federal Section Eight Housing Program.
Also before the State Legislature is a law that would increase the implementation of the New York State “Mansion Tax” to residential properties of one to three units, including condominiums and cooperatives from 1% on purchase price of $1 million or more to $1, 750, 000. However, this would only affect municipalities with populations of 500,000 or more. Only New York City would meet the population requirement.
The New York City Council is considering legislation that would require a board of directors of residential cooperatives to respond in writing within a prescribed number of days from the submission of the application to purchase the shares and give a reason should the application be denied. A similar law is already in effect in Suffolk County.
What has been abandoned by the State Legislature is legislation that would have created another category of agency disclosure for real estate agents known as “transaction brokers.”
Also, a change in real estate continuing education required for license renewal from twenty-two and a half hours every two years, to forty-five hours every four years.
At the risk of sounding self-serving, there are ways that real estate professionals can stay abreast of changing laws and court decisions that affect their business and responsibilities to the public and each other. One is way is through continuing education classes.