Posted By: Diana Olick | Realty Check with Diana Olick, www.cnbc.com, March 9, 2009
Just when you thought it was impossible to find any good news for anyone in the real estate business, deep inside the FY09 omnibus appropriations bill lies a little golden nugget for the Realtors.
No, not a bailout, but the next best thing.
It’s a provision that permanently prohibits banks from getting themselves into real estate (excepting mortgages of course).
Many moons ago, okay in 1999, the Gramm-Leach-Bliley Act made it possible for banks to get into securities and insurance (look how well that went!) but not into real estate—until 2001, when federal regulators suggested banks could get into real estate brokeraging and management. Well the power of the Realtor lobby fought that tooth and nail, and dollar for dollar, and managed to make sure that the rule was blocked each year for the past eight years with a little rider in the annual appropriations bill. This time they made it permanent.
The National Association of Realtors, which doesn’t want to comment on the legislation until its signed, sealed and delivered, has 1.2 million members and its PAC ponied up $3.9 million to federal candidates in the last political cycle. That made them the largest giver. The majority of the cash went to dems, but Republicans got their fair share as well, and now, lo and behold, they have a permanent deal to keep bankers out of their business.
It’s a solid victory, despite the fact that I’m guessing most bankers right now don’t really feel like getting any deeper into real estate than they already are.
Questions? Comments? RealtyCheck@cnbc.com
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