Q. How does the 2009 BMA differ from the 1996 version?
A. The new BMA differs in a number of areas. The following list can give you a sense of many of the significant changes although it is not comprehensive:
- It is now six pages vs. three.
- The form has been made both easier to complete as well as more comprehensive with the addition of checkboxes.
- There is a new section that covers the Subject Location and looks at issues that may affect the marketability or value of the subject property.
- The Subject Condition section has been expanded and again utilizes checkboxes for the preparer to identify property condition issues.
- The Financing section as been augmented with questions on HOA fees—amount, what they cover, and amount and type of special assessments.
- The Market Conditions section is almost entirely new and asks the preparer to not only assess conditions in the subject’s neighborhood, but also the broader market area (defined as, “That area beyond the subject neighborhood in which buyers will look for comparable properties.”).
- The Competing Listings and Comparable Sales grids have both been expanded to one page each (vs. a half page), asking for more information but primarily in a checkbox format to facilitate ease of use. In addition, the grids ask for a 12-month previous listing history for each of the properties.
- The ratings sections of the grids have changed as well and now ask the preparer to compare specific characteristics of each competing listing or comparable sale to the subject property rather than to the market area.
- A new section was added so preparers can identify “The Most Likely Buyer(s)” for the subject property which plays into the new Marketing Strategy section.
- The Marketing Strategy section has been completely revamped and is presented in a series of questions the preparer must answer thus enabling the preparer to better target their recommendations.
- The Value Analysis has been revised and is simplified. It asks for a Most Likely Sales Price (MLSP) based on “as is” condition and a Suggested List Price (SLP) only. The preparer no longer has to calculate a MLSP with repairs and improvements.
Q. How can I get a copy of The Worldwide ERC® Guide to the Broker's Market Analysis and Strategy Report?
A. View a copy of the report
Q. Does Worldwide ERC® offer a comprehensive licensing program for those companies that would like the flexibility to integrate the form into their own systems.
A. Yes. For more information on this option, please contact David Stephenson at dstephenson@WorldwideERC.org.
Q. Is the 2009 form offered by Worldwide ERC® licensed software providers?
R. Yes. You can access a list of the software providers we are working with to provide the new form by visiting Worldwide ERC® Licensed Software Vendors page. Check with the software providers directly regarding availability.
Q. Does the form have a photo page?
A. A photo page is not a part of the form itself. However, there is a Word document that is available on the Worldwide ERC® Forms Portal that individuals can use for that purpose.
Questions about the technical aspects of completing the Worldwide ERC® BMA:
Q. Some of the fields look like they cannot accommodate all the information I want to place into them. What should I do?
A. If using the dynamic pdf form that resides on the Worldwide ERC® Forms Portal, you will notice that when you type information onto the form that the font size will get smaller to accommodate more writing. However, there is a limit to how many characters each field can accommodate. If necessary, you may need to put information in an “additional comments” field provided in select section sections of the report or add an addendum to the form in order to include the additional information you wish to provide.
Q. When completing the grids on pages 4 and 5 of the new form, do the tab buttons move down each column within each property so you can work on one property at a time or across the page encompassing all the different properties at once?
A. Tabbing moves you down each column so you can complete the information on one property at a time.
Questions about specific line items on the Worldwide ERC® BMA report:
Q. Within the Subject Information section where the preparer is asked to identify improvements made by the homeowner, is the preparer required to find out whether or not permits were obtained?
A. While there is no ‘requirement’ indicated on the form for the preparer to determine if permits were or were not obtained, this certainly could be an important consideration to the requesting company. While it would seem at first glance that providing this information would indeed be an enhanced report writing technique, this is a difficult question to answer definitively as many real estate company owners set policy with regard to an agent doing investigation on properties which raises their standard of care to a level that is over and above those responsibilities generally designated to real estate agency. Perhaps the best way to answer this would be for the preparer to ask the homeowner if permits were obtained and report the homeowner’s response to the requesting company.
Q. Please explain the line items regarding financing concessions.
A. The agent preparer is to identify and describe any financing concessions that may be necessary to be paid by the seller in order to best market the property and secure the sale of the subject property. These may include points, closing costs, or some other type of concession.
Points – If the customary financing noted typically includes the seller paying for loan origination points, this should be indicated along with the number of such points. The preparer should take into consideration the points customarily paid by the seller for the buyer to obtain the loan and buyer’s discount points.
Since the requesting company needs to know how much expense to expect with regard to paying points, the information provided in this section is essential.
Closing Costs – If closing costs are customarily paid by the seller in your region, note it as either a percentage of the sale price or a flat dollar amount.
Other – The preparer should identify any other financing concessions that that may be required (e.g., regional, city or state down payment assistance for first time home buyers). If there are none, the agent should indicate that as well.
Q. Under the Financing section, the preparer is asked to provide a variety of information related to HOAs. Will the agent preparer also need to determine whether the HOA has cash reserves at hand and how much?
A. As an advance report writing technique the agent preparer should provide this information, particularly if it will impact the marketability of the home or its value. This information could be provided on page 6 in the Marketing Strategy section of the report.
Q. Please explain why the Absorption Rate was based on six months vs. 12.
A. There has been an attempt to create some standardization within the form. For example, in the Market Conditions section when the preparer is asked to indicate whether the subject neighborhood prices are increasing, stable or decreasing, the preparer is instructed that this is also to be based on a six month period.
Q. Within the Market Conditions section where the preparer is asked to provide the types of competing listings, how would homes that were sold under a short sale be categorized and listed?
A. Short sales would be considered resales; however, a preparer that is knowledgeable of their marketplace would definitely need to talk about this aspect of the market in the Market Conditions section of the form where it asks about current economic conditions.
Pages 4 and 5
Q. How should the agent preparer handle the situation in which the subject property has a previous listing history longer than 12 months?
A. The agent preparer should note this in the comments section below the appropriate grid and provide additional information in the Marketing Strategy section on page 6 if this information will impact the marketability or value of the subject property.
Q. For purposes of completing the grids on pages 4 and 5, how would an agent know if the stucco type for the exterior siding is synthetic, hardcoat or natural?
A. This is most likely a regional issue and the agent would base this on his/her knowledge of area. If the agent does not know, they should indicate that so that a requesting company could obtain further investigation if it is an issue.
Q. What is a Built-in garage?
A. This item was included as in certain parts of the country, a built-in garage is common. Built-in garages typically are found in the bottom level of a multi-level home.
Q. Please review how to count rooms for the purposes of providing the total room count for the Above Grade Room Count line item.
A. Above Grade Room Count – This line requires three numbers to be reported: total number of above-grade rooms, the number of bedrooms within that count, and the number of above-grade bathrooms. (Unlike bedrooms, bathrooms are not included in total room count.) Only those areas that are part of the property’s gross living area should be included in this room count line.
Total Room Count – In addition to bathrooms, hallways, foyers, walk-in closets, laundry rooms, and storage areas usually are not included in the total room count. Rooms in the attic and basement (even if finished) generally also are excluded since these areas typically are not part of a property’s GLA. Finished bonus rooms may or may not be included in the total room count depending upon their location in the house.
While this manual provides definitions and guidelines, regional differences must be taken into account. For example, if it is the standard practice in an area to consider laundry rooms in room count, this may be done as long as this approach is consistently applied to all the properties in the grids.
By definition, a room should have four distinct walls. That is, the area should not be part of another room with partitions defined by furniture placement. This distinction can be illustrated by the description of a “dining room” as opposed to a “dining area.” If it has four walls, then it would be considered a “dining room” and counted as a separate room. If it is completely open to another room, with no separating wall, it would be considered a “dining area” and not be counted. However, once again, local custom may intervene. If a dining area without a fourth wall is considered a dining room in the market area, then count it as such. However, this area must then be counted consistently as a room for all similarly structured properties in the grids.
Q. Please give an example of what should be filled in for the Basement Finish line item.
A. On the “basement finish” line, indicate the extent to which basement finishing exists using either descriptions and/or specific square footage and what rooms may exist – e.g., full finish 1BR, 1 BA; 800 sq. ft., finished, Rec Rm; unfinished.
Q. Please give an example of what should be filled in for the Bonus Room line item.
A. If the property has a bonus room, indicate on the “bonus room” line the extent to which the room is finished using either descriptions and/or specific square footage – e.g., full finish; 800 sq. ft., finished; 80% finished; unfinished. If no bonus room, write “none.”
Bonus rooms may be located in a variety of places in the home (e.g., over a garage, off of a bedroom). Regional differences may dictate their inclusion in the total room count. However, if they are not finished, they should not be included in the total room count at all.
Q. Please explain the last line item in the Value Analysis section asking for the Number of Days to Contract of Sale.
A. For this line item, the agent should enter the number of days being used to evaluate the MLSP and SLP. This number will most likely be whatever is normal for the area, unless ‘normal’ is greater than 120 days in which case, the number will be 120. However, this is a client directed policy and should be verified with the requesting company.
Q. Can the preparer use a digital signature?
A. Digital signatures are widely accepted in many parts of the country and by many companies. You should check with the requesting company determine whether or not they will accept a digital signature.
Questions about training:
Q. What training is available on the Worldwide ERC® Broker’s Market Analysis and Strategy Report (BMA)?
A. Currently, Worldwide ERC® has: Mastering the Worldwide ERC® Broker's Market Analysis and Strategy Report. See "training" above.