LaPolitics recently spoke with Norman Morris, CEO of Louisiana Realtors, to get his take on some political issues that affect real estate.
How will this year’s landmark settlement reached over commissions change the housing market?
Morris: We implemented two main changes. Realtors’ compensation will not be included in the Multiple Listing Services, and all buyer agents must engage their clients with a buyer representation agreement in all residential one-to-four-family homes for sale, which outlines the services Realtors will provide along with the agreed-upon compensation. The proposed settlement should be finalized next month. Additionally, this past legislative session, we worked with Rep. Paula Davis to draft ACT No. 690, which requires all Louisiana real estate licensees to execute a buyer agreement with their client(s) on all residential real estate transactions.
How is the current cost of property insurance and flood insurance affecting the market? What reforms would you like to see in those two areas?
In many cases, particularly in areas south of central Louisiana, real estate consumers either cannot afford property insurance premiums or cannot find insurance products at all to cover their properties. We worked with Insurance Commissioner Tim Temple and other industry partners to assist in passing several bills that we hope will attract new insurance companies to our state and encourage existing companies to increase their number of policies. We continue to support funding efforts for the fortified roof program to provide more protection for property roof structures. As for the National Flood Insurance Program, many property owners cannot afford the rising flood premiums. The industry still has questions on how FEMA determines premiums for properties using the fairly new rating system Risk Rating 2.0.
What can lawmakers do to improve access to homeownership?
We support a few bills currently in Congress: The More Homes on the Market Act would increase the amount of capital gains a homeowner can exclude on the sale of their principal residence. The Neighborhood Homes Investment Act would offer tax credits that would create a pathway for neighborhood stability by incentives to build and rehabilitate homes for low- and moderate homeowners. The Revitalizing Downtowns and Main Streets Act would provide tax credits for adapting commercial properties in downtown areas into affordable housing units.
The Federal Reserve likely will continue cutting interest rates. Can we expect to see mortgage rates come down as well, and if so, when?
We have seen interest rates drop over the last couple of months and we certainly hope to see rates dip to under 6% next year. We are focused on policies that keep housing and property ownership affordable and available all across the state. We will continue to support legislation that encourages property ownership, while finding solutions to increasing insurance costs.
What are your organization’s priorities for the upcoming regular legislative session?
While interest rates and home inventory are big challenges for today’s homebuyer, the overwhelming major issue is insurance—both property and flood insurance. We will continue to work with Insurance Commissioner Tim Temple and the Department of Insurance on finding ways to lower these costs to Louisiana homeowners as well as attracting more companies to our great state.
They said it: “The majority has removed an unattractive wart by using a chainsaw when a scalpel would have remedied the current litigants’ problems and inflicted no collateral damage to our codal system of law.” –Justice Jay McCallum, dissenting from a recent state Supreme Court ruling overturning a law that allowed legislators who are attorneys to delay court proceedings, in Louisiana Illuminator.
Jeremy Alford publishes LaPolitics Weekly, a newsletter on Louisiana politics, at LaPolitics.com. Follow him on Facebook or X (formerly Twitter). He can be reached at JJA@LaPolitics.com.
