Wednesday, February 28, 2007

Sesquicentennial Celebration for Anoka County--That's 150 Years to You and Me!

2007 is a big year for Anoka County. It marks 150 years since it was officially formed. To honor this occassion, the Anoka County Historical Society is planning a big Sesquientennial Celebration. the scheduled events:

Wagon Train

20 Wagons and 50 head of livestock with travel across the county from Coon Lake to the Anoka County fairgrounds April 12-20

Photo History Exhibits

A traveling historical photo exhibit will be tour through each of the 21 communities in Anoka County.

A stationary historical photo exhibit, Picturing Anoka County--150 Photos for 150 Years, will be on display through the end of the year at the Anoka County History Center in Anoka.

Heritage Quilt Competition and Exhibition

In conjunction with the Anoka county fair, the will be a special quilting competition with a 150th Anniversary theme.

For additional information, on-line historical photos and the entire schedule of events, visit the Anoka County Historical Society website 

Tuesday, February 27, 2007

Dangerous Decorating--Home Improvements that Lower the Value of your Home!

Reality television home improvement shows are no doubt fun to watch. It is amazing to see a small room or entire home transformed into a show place. Some of the most unbelievable transformations are on children’s rooms. They will take a theme like the racecars or princesses and make a child’s dream come true.

As a Realtor, my favorite part of the show Trading Places: Boys vs. Girls, is at the very end when the parents arrive to see the redecorated room for the first time. Whether there are ropes hanging from the ceiling, a psychedelic paint job or artificial grass on the floor, the reactions are priceless. Sure they are saying “awesome” for the television cameras, but are they really happy with the new rooms? As a parent, I know how quickly kids grow out of favorite toys, colors and activities. A theme-based room could be hard to transform back to a normal room when the fad passes or child grows. And what if you have to sell your home? How will potential buyers view that boat on the ceiling or the chalkboard walls?

This isn’t just something that happens on television. People really do crazy things to their homes and it’s not always for their children. Whether it is a unique wall treatment or an indoor hot tub, some people’s individualism hurts the value of their homes.

Here are some of my favorite, unbelievable things I have seen in people’s homes and how the remodel deteriorated the estimated value.

Playground Swings in the bedroom. This family removed a wall from two adjoining bedrooms to create one large room and bolted two playground swings to the ceiling. This home was 1700 ft.., split level home with 3 bedrooms prior to removing the wall. It is now an odd two bedroom. Combined with the possible extreme damage to the structure of the home depending on the weight of the persons using the swings this home would have lost thousands of dollars of market value.

Crinkled grocery bags glued to the wall instead of wallpaper. It is a nice unique look but since it will be difficult, if not impossible to remove, you will need to find a buyer who likes the look as much as you did.

Multi-colored hand painted murals and stenciling painted on walls throughout the home. This can be beautiful to the owner but because it is uneven, it is difficult to repaint. Often sanding and several layers of special primer are required to remove.

Indoor hot tubs. Unless you are installing in a four-season porch, think twice about this, especially if you live in a cold weather state. It just doesn’t make any sense. I have seen them installed in bedrooms and family rooms. Many were professionally installed. Most buyers still didn’t like them because they took away living space. Often buyers were concern about the installation. What if it leaks? Will it wreck the foundation? Does the steam cause mold? Even if the sellers offer to remove the hot tub prior to the closing, buyers have so many concerns that they will walk away from the home. Again your improvement reduced the value of your home buy tens of thousands of dollars.

So does this mean a person shouldn’t personalize their home at all? Of course not! It is your home after all.

What I am suggesting is that when you are considering a home improvement or trying the next decorating trend, remember that your home is your biggest investment and asset. Put the hot tub on the patio, deck or four-season porch. Swings belong in the backyard. And wall treatments need to be removable and easy to repaint. Make your decisions with this in mind and your home will be beautiful and pocketbook will be protected.

Monday, February 26, 2007

Open Houses—Do they Work in a Buyer’s Market?

A homeowner just put their house on the market and their real estate agent recommends an open house every Sunday until the home sells. Is this a good idea?

A different homeowner lists their home and their agent refuses to do open houses since they just waste time and money. Which agent’s system is correct?

Frankly, I don’t think either of these systems is a good idea. Too many open houses can make a seller look desperate. But refusing to do open houses because they don’t work might not be in a seller’s best interest. As a Realtor, I assess each home and family situation to come up with an open house plan that will work for my sellers.

Homes do sell at open houses!

Do you live in a high demand neighborhood with lots of drive by traffic? Will families be passing by on their way home from church or on their way to restaurants and shops? Is your home priced correctly for the neighborhood?

If you can answer yes to these questions, an open house may be an effective marketing tool for your home. Potential buyers who like specific areas will stop to see what is available. If the home is well priced, I have seen buyers write offers on the spot.

One thing to consider is the internet has changed the real estate market. It allows buyers to be very informed by doing research prior to attending open houses. Often net savvy buyers are working without representation and see the insides of homes only at open houses.

If your home is well off the beaten path or you were the only one in the development to add all of the upgrades, open houses might not be successful. Buyers won’t follow more than 3-4 directional arrows and travel more than ½ a mile out of their way. Likewise buyers are frustrated when they do stop but realize that the price tag is $50K higher than the rest of the neighborhood because there are granite counters, cherry wood flooring and custom birch cabinets. If your home falls in either of these categories, open houses might not be successful.

Does your family situation make open houses convenient?
If the only family time you have at home is Sunday afternoons, it is ok to say no to open houses. Some homeowners want scheduled showings with qualified buyers only. This limits access to your home and keeps “looky-lou’s” to a minimum!

Timing and Duration of Open Houses
For most homeowners, I suggest one open house per month and not longer than 2 hours. (I will do two per month, if the homeowner’s schedule allows.)You should schedule the open house at least one week in advance. This allows time to place ads in the paper as well as on the internet.

Open houses are a valuable tool in selling your home. To be effective, they must be combined with other tools in a complete marketing plan to sell your home.

Sunday, February 25, 2007

Winter Hits the Twin Cities--Finally! Important Tips to Protect Your Home!

We have definitely had a wimpy winter by Minnesota standards. But this weekend we are making up for it big time!

Until yesterday, the Twin Cities snow fall total for the season was somewhere around a foot. Since Friday evening and through tonight (Sunday) this whopper of a storm will deliver twice what we have seen all year.

Here are a few reminders of what you should do to protect your home from the accumulated heavy snow:

Get out the snow rake.

A snow rake is like an inverted shovel that is used to rake or pull snow from your the edge of your roof while standing on the ground. The downwind side of your home could have drifts twice as high as the recorded snowfall. Left to melt on its own, the snow can refreeze and cause ice dams. (Icicles are often a sign of this problem.) As an ice dam grows, it will prevent new melt from draining off the roof. This water can be forced under the roofing material and enter your walls or attic. Prevent the problem before it happens with the snow rake it is much safer than climbing on the roof to shovel.

If the edge of your roof is too high to reach with a snow rake or the icicles are already forming, consult a professional as to the best method to clear. It is imperative to address the situation immediately as water damage can cause significant interior damage and eventually mold. The cost to repair at this stage can be astronomical.

Shovel and Clear Around Home.

Dig out any window wells that have filled with snow as well as any stairwell that leads to a lower level. If left uncleared, the snow could cause basement flooding as it melts. Also remember to clear a path to and around your gas meter.

Obviously, this is important so that your meter reader can have access for a correct reading. But less obvious is the risk of a gas leak from damage to the meter by heavy snow. As a precaution, when you clear around the meter, use your hands, not a shovel.

Saturday, February 24, 2007

Rent VS Buy? It's Time to Revisit the Question!

Early indicators for 2007 are that rents are on the increase. As occupancy rates rise, often rent increases follow. If you have considered purchasing your first home before, now is the time to revisit the question:

Should you rent or buy?
I have discovered a great website to help you answer that question. Ginnie Mae is an organization providing that provides the private mortgage insurance to most government (FHA and VA) loans. There website provides tips, tools and ideas to help out the first time buyer.

One of Ginnie Mae's most helpful tools is their Rent versus Buy Calculator. It is simple to use: Enter you current rent, the price of the home you are considering, how long you intend to stay at the home and a few other details. The calculator will provide you with an indication of where you will stand financially if you make the purchase. It is a good tool because it allows you to adjust the estimated property value increase. (In this slower market, it would be safer to consider a 0-2% increase, without consulting a Realtor for an estimate for a particular region or neighborhood.)

Ginnie Mae's site not only has the Rent vs Buy calculator, there is an affordability calculator and loan estimator. There are tips for the first tip homebuyer outlining additional financial considerations and costs for owning a home. There are ideas and articles to help you understand your mortgage options. Check it out and as always, if you have any questions, I am just a phone call or click away!

Friday, February 23, 2007

Private Mortgage Insurance (PMI) Update—Now Tax Deductible

Starting on January 1, 2007, private mortgage insurance became a deductible expense for new borrowers with less than a $100,000 income. This new legislation will help homebuyers who may have chose to a more risky piggy-back type of loan to avoid PMI over the past few years.

So what is PMI?

In a conventional mortgage, a buyer is required to put down a 20% down payment based on the sale price of the home. Private mortgage insurance is paid when a buyer does not the full 20%. The fee is paid monthly by the buyer to protect the lender in the event of foreclosure. It is paid until equity accumulates to a point where there is 20% ownership of the home.

Avoiding PMI with Piggy-back Loans

In recent years, many buyers in an effort to avoid paying PMI have used a piggy-back or secondary loan for their down payment. In this scenario, the second loan is often similar to a home equity loan. Often it will be have an adjustable interest rate and/or a balloon payment that will come due in 3 to 5 years.

So Which is Best? PMI or Piggyback?

It will really depend on your situation. With the deductible aspect to PMI, it is worth considering again. If your home appreciates or you are able to put in some “sweat equity” to increase the accumulated equity of the home to the 20% of the appraised value, in most cases the PMI will be cancelled. However with a second loan, you will continue to make payments until the loan is paid in full.

To make the best decision, discuss your all options with your Realtor and Mortgage or Loan Officer. Working with trusted professionals to explain all aspects of various loan products help you to select the best mortgage that works to meet your financial goals.

Thursday, February 22, 2007

Minnesota Lakeshore Is Affordable Again!

In the past decade the prices on Minnesota lakeshore had become out of reach for many buyers. Prices shot up in the late 1990’s. Lake lots on Coon Lake in Anoka County went on the market in 1998 for $60,000 and were re-sold three years later for over three times that at $200,000. Homes on lakeshore saw similar increases. There didn’t seem to be an end in sight to what someone would pay for lakeshore in the Twin Cities.

Then “The Buyer’s Market of 2006” hit the Twin Cities and north metro. What a welcome relief to would-be lake home owners. The chance to own Minnesota shoreline is once again within reach.

The recent buyers market has affected the prices of lakeshore in Minnesota. With there being so many homes available, buyers have a selection that hasn’t been seen in the past decade. That abundance of homes is in all categories, including the wonderful lakeshore homes coveted by Minnesota sportsmen and nature lovers. To see what kind of an impact the buyer’s market has had Minnesota lakes, I did some research on lake homes sold in the past six months (August 2006 to February 2007). As a Realtor working in the north east metro for several years, I knew it was difficult to find reasonably priced Minnesota lakeshore in for the past few years…especially with a quick commute to the city. I wanted to see if the change in the market had made lakeshore more affordable. What I found is that an in-town lake home is not only affordable, they are available.

Focusing on the north east metro counties of Anoka, Chisago, Ramsey and Washington, I discovered some interesting facts. I set up a search for lakeshore homes sold that had at least 3BR/2BA and a garage and listed after August 1, 2007. The homes had to be a single family dwelling, not a town home or condo. There were 24 homes that met these criteria. I then took a closer look homes that sold for the lowest and highest price in each county. Since most homes sat on the market for several months, there were some amazing price concessions by sellers. The 24 listings were on the market an average of 178 days. But when I looked closer at the homes, I realized that this was not accurate. Many of the homes were cancelled and re-listed so the DOM would start again at zero. (In my estimation, the average time on the market for north metro lakeshore is 9 months to a year.)

So where are the deals on Minnesota Lakeshore? All over! Here are some of the highlights:

Sale Price of Lakeshore Homes in Anoka, Chisago, Ramsey and Washington County Fall06/Winter07

Anoka County
Lowest Sold Price $225,000
Highest Sold Price $507,750
Average $389,550
Total Homes Sold: 5

The lowest priced lakeshore home sold during the past 6 months was in northwest Anoka County in the little community of Burns Township. It was Twin Lakes rambler on 400 ft. of shore with 3BR/2BA and a 2 car garage. It sold for $225,000.

On the other end of the spectrum, in southern Anoka County, a Lino Lakes home with 100 feet of shore on Reshanan Lake. It originally listed for almost 2 years ago for $585,000 but sold for just $507,750. This home is located with a quick commute to either downtown is a multi-level home with 4BR/3BA and a 3 car garage.

Chisago CountyLowest Sold Price $292,500
Highest Sold Price $486,000
Average $382,125
Total Homes Sold: 5

Both the lowest and highest priced sold homes were located in Chisago Township about 45 minutes northeast of downtown St. Paul. The lower priced home boasted 150 ft of shoreline on Chisago Lake. It was a 3BR/2BA/2Car home built in 1956 and sold for just $292,500. On the high end, was a 2002 built lake home on Green Lake with 85 ft. of shore. It was listed at $534,900 but sold for $50,000 less after 6 months on the market.

Ramsey CountyLowest Sold Price $293,550
Highest Sold Price $673,000
Average $423,890
Total Homes Sold: 8

Ramsey County is the heart of the east metro and is home to the capital city, St. Paul. Surprisingly, there were some lakeshore bargains here as well. On the low end of the spectrum, there was a home with 100ft of shore on Goose Lake. The home located in White Bear Lake originally listed for $389,000 but after six months on the market sold for $295,550, nearly $100K less!

On the more expensive side was a North Oaks home with 150 ft of shore on Charley Lake. The home is on a 1.3 acre parcel in a private community. The 2 story was built in 1980 with 5BR/6BA/3Car. After being on the market for just over a year, it sold for $673,000.

Washington County
Lowest Sold Price $399,000
Highest Sold Price $1,599,000
Average $822,483
Total Homes Sold: 6

Washington County was home to the most expensive and fastest lakeshore sales in the north and east metro during the past six months. But there were bargains here as well. At the low end a lakeshore home in Oakdale, on Park Lake sold for at the listed $399,000 in just 45 days. At the other end of the spectrum a Mahtomedi 1930’s charmer on White Bear Lake sold in just 15 days for $1.6 million.

Are you interested in buying Minnesota Lakeshore? Now is the time. There are still hundreds of homes on lakeshore listed on the Twin Cities MLS. Many of these beautiful homes have been on the market for several months. Most of my clients are asking to be emailed with immediate listings of "just listed" and "just reduced in price homes". With the right offer and Realtor who understands the lakeshore market, you could be spending this summer on a Minnesota lake!

Contact me today to be set up for automatic lakeshore listings. Emails will be sent immediately when a price drops on a lakeshore home or a new listing hits the market.

Wednesday, February 21, 2007

Trim Your Oaks NOW! Winter Pruning is Best to Protect Your Investment!

New home developments are abundant in the north metro Twin Cities. From Anoka through Chisago Counties and beyond there are many new communities that have sprung up from Blaine to North Branch. The lot prices can vary from $60,000 to over $200,000. What make one neighborhood more appealing and valuable than the other? Although location always plays a key role, another important factor is the landscape.

Are there any trees? A question often asked by clients as they start searching for a home. Many Minnesota farms have been developed into single family housing developments. While the flat open land was desirable for farming, it does not have the privacy and up north feel of a wooded lot with mature oaks.

If you are fortunate to have mature oak trees on your property, protect your investment!

What is Oak Wilt?

Oak wilt is a disease caused by a fungus which attacks the central system of the tree from the roots to the leaves. The tree attempts to block the fungus, but also blocks all water and nutrients to the branches and leaves. Eventually, the trees leaves wilt and it dies.

Oak wilt spreads through the root systems of near by trees and by fungus beetles that carry the oak wilt spores from tree to tree.

How to Protect Your Trees

The fungus beetles infect trees that have been recently injured or trimmed. These beetles are very active in the spring and summer months. Oaks should be protected from damage and not trimmed from April through July.

Trim large mature oaks now. As a preventative to spring storm damage, have your large oaks trimmed now so that heavy, dead branches won’t fall during tornado season and break other healthy limbs.

Consider Oaks When Planning Construction

If you are planning to built on your property this spring, plan the construction process to protect the trees. Discuss the situation with your builder and fence off the trees from the base of the truck to the branches.

Be prepared with tree paint and apply immediately to any wounds that accidentally occur.

Root System Protection

If an oak is infected on your property or a nearby neighboring property, your trees could be at risk through their intertwined root system. Oak roots travel up to 50 feet out. The fungus can pass underground from tree to tree.

To prevent spread, have the roots cut using a trencher or vibratory plow. The five foot blade severs the roots to protect neighboring trees. Root cutting should be done prior to tree removal.

Many cities in the north metro have tree protection programs and offer a low cost or free root cutting service in the fall.

If you have oak wilt in your neighborhood, doing nothing is not an option. Ignoring oak wilt will cause the lost of trees which directly relates to your property’s value.

Tuesday, February 20, 2007

Moving with Pets--Important things to remember!

Moving can be especially difficult on one of your most important, but often overlooked, family members: your pet. I often hear from clients that their pets begin acting up weeks before the actual move. The resulting behavior can cause destruction in the home you are selling as well as concern for the pet’s reaction in their new location. If Fido or Kitty is a senior pet, a new home can be particularly traumatic. How do you relieve your pet’s anxiety? Preparation is the key.

Before the Move

Visit the Veterinarian for a complete examination. Verify and document that all vaccinations are up-to-date. Inquire about medications for stress and the options of administering before or during the move depending on your pet’s particular needs. Keep copies of your pet’s medical records, including a current photo, in an accessible place.

Check homeowners association and local authorities for pet restrictions before purchasing your home. Many cities and neighborhoods have restrictions on the type, size and number of pets you are allowed to keep in a home. Requesting this information prior to making an offer can save the heartache of your beloved pet being restricted from your new home.

Keep to a regular routine. If your move will require the use of a carrier
, find one of good quality that is sturdy, comfortable and insulated. It needs to be large enough to accommodate your pet and allow movement. Have it out in your house and use it routinely, so that your pet is familiar with his temporary home and comfortable in it.

Moving long distance and traveling by car? Many hotels are pet friendly but some are not. Plan in advance your route and check with area hotels for the ones that will allow your pet to stay with you. Your pet will appreciate the chance to get out of the carrier in the evenings and spend time with you.

Moving Internationally? Pets could require 6-12 months of surveillance or quarantine before being allowed into a different country. Check restrictions and make preparations well in advance of the move so there are no surprises for your family.

Day of the Move

Make sure your pet is safe. Keep in a safe room/kennel or at a trusted neighbor’s or pet sitter’s home while your belongings are being loaded into the truck. (A
pet sitter directory is available at ). Make sure it is a place your pet is familiar with as to not create additional stress. If you do leave your pet in a room in your home, remember to check in frequently. Leave a litter box for cats and let dogs out on a leash for breaks to avoid accidents.

Identify your pet. Make certain that your pet’s collar or tags
have current information with a cell phone number and/or the new home information so you can be contacted in the event of an escape.

Time to load the pet carrier.
Put in your pet’s favorite blanket, toy or bed along with food and water for the trip. Remember a container of additional food and water in case of spills. It is a good idea to pack paper towels and wet wipes to clean up any messes from sickness or accidents during the ride. Don’t leave your pet unattended for more than a few minutes at a time in his transportation kennel.

At Your New Home Sweet Home

Expect some behavior changes as your dog or cat becomes accustomed to his new surroundings. Use as many familiar items from your pets past to make him feel at home. This is not the time to try out a new food or bring in the new pet bed. Bring in his old toys, dishes and blankets to make your old friend comfortable. With lots of love and attention, Fido and Kitty will be back to normal in no time.

Monday, February 19, 2007

Real Estate Agent Selection Primer—How to Choose the BEST Realtor for YOU! (Part Two of Two)

The Twin Cities Fox News affiliate’s investigative team recently ran a new segment on mortgage and real estate fraud. A man was allegedly bilked out of nearly half a million dollars by a loan officer and real estate agent he met in a bar! The story is not a new one but what struck me was the “in a bar” statement. How many people are selecting their advisor on real estate over a beer in the local tavern? Let’s think about this a minute. One of the biggest, most important investments in a person’s life and they rely on an acquaintance in a bar? I hope they at least ordered some appetizers before they signed the contracts!

The average American will buy or sell a home only 2-3 times during their lifetime. It is imperative to have a logical process to select a real estate agent. Purchasing and selling a dwelling for your family is a very emotional situation. If you chose an agent wisely, you will be confident that your Realtor is on your side through the entire purchase and/or sale even when emotions are running high.

As a Realtor in Minnesota, I love assisting people to find the perfect home. My clients come from the referrals of past clients as well as open houses and other marketing avenues. When I meet a potential client, I expect questions about myself and my business. I answer additional questions about the Twin Cities metro real estate market and specifics about homes available. Not all of these potential clients ask relevant questions. They can already be caught up in the emotional buying process or a major life change. There is an easy step-by-step approach that can be used to find the best real estate agent for your family. In part one, I discussed how to prepare yourself mentally for meeting with potential real estate agents. (View part one of the article at ). Here is final step in my step-by-step approach to selecting the perfect Realtor for you.

Six questions to ask a potential agent

Do you have an introductory flyer or personal resume that you could send me prior to our meeting?The way an agent promotes him/herself will give you a good idea of their professionalism. If you receive high quality, well thought out marketing materials in the mail within the next day or two, the agent is on the ball. A well written, professional personal brochure should be part of a Realtor’s marketing materials. If you receive something of less quality or nothing at all, the agent might not be able to pay attention to detail throughout the transaction.

Do you work independently or as part of a team?

If you are part of a team, who will I be working with most often? If you prefer to have someone who can immediately answer the phone and track down an answer, you might like working with an agent that is part of a team. But it is important to understand how the team operates. Some teams will operate with the agents being interchangeable where you will have one agent showing you homes to buy, one agent handling listing your home, and another holding the open houses. Often teams will have unlicensed assistance handling the incoming phone calls.

If you want to work with the same person throughout the transaction, you may prefer an agent that works independently. Often when you call their office, the agent will pick up the phone. They handle all the details throughout the transaction and can answer your questions directly without waiting to contact another source.

Can you give me the names of past clients?

An experienced Realtor will have worked with any number of clients and will be able to provide you with a list of previous clients that you can contact as references. When talking with the references, it would be a good idea to ask if they had any problems during the transaction. If they did, ask how quickly and professionally they were resolved. Also ask how they met their agent. If the agent gives you only a list family members and best friends from high school as references, it may be concerning.

(For Buyers) Can You Help Me Understand My Financing Options?

If you are pre-approved for a mortgage but do not understand the financing paperwork after meeting with your loan officer, a good real estate agent should be able to peruse the documents to note any fees that do not seem correct. Sometimes a phone call by a Realtor to the loan officer on your behalf can resolve the issue. If not, most real estate agents have several good mortgage professionals that they have developed professional relationships with they can call upon. It could be in your best interest to visit with another loan officer to verify that all fees charged are necessary and that you are in the best type of loan program for your situation. Any real estate agent unable or unwilling to assist you in finding the tools to understanding your financing options might not be the best choice.

(For Sellers) What is your listings-to-sales ratio?
Some agents seem to have every house on the block or every house in a neighborhood listed. You see their signs in yards throughout the town. There ads are in your local newspaper and in your mailbox. This is may be an indication of a successful Realtor. But the big question is “Did the homes sell?” In this slower buyer’s market, there are many more homes on the market than buyers. Do you want an agent that can successfully get you to list your home or one who will actually get the home sold? If the agent is unsure of their ratio, you can figure it out for them. Ask how many homes they listed last year. Then ask how many listings they sold. (Make sure that the agent doesn’t include sales of homes where they represented the buyers.) Divide the listings sold by the total number of listings to get the ratio. If the ratio of listings-to-sales is less than 50%, you might want to select a different agent. Successful agents won’t sell every home they list, but their success ratio will be over 70%, even in a slow year.

(For Sellers) How will you market my home?
A comprehensive marketing plan should be prepared for your specific home prior to signing any contract. Good agents establish a marketing plan for each home they list. Your Realtor should provide you with a schedule of advertising and open houses. They should outline what publications and websites your home will be listed in and the timing for their inclusion. If there is going to be a sign in your yard, your agent should tell you whether their will be a brochure box with flyers for potential buyers driving by. Anything from the number of pictures in the MLS or whether there will be a virtual tour should be discussed and outlined.

Sunday, February 18, 2007

Real Estate Agent Selection Primer—How to Choose the BEST Realtor for YOU! (Part One of Two)

The Twin Cities Fox News affiliate’s investigative team recently ran a new segment on mortgage and real estate fraud. A man was allegedly bilked out of nearly half a million dollars by a loan officer and real estate agent he met in a bar! The story is not a new one but what struck me was the “in a bar” statement. How many people are selecting their advisor on real estate over a beer in the local tavern? Let’s think about this a minute. One of the biggest, most important investments in a person’s life and they rely on an acquaintance in a bar? I hope they at least ordered some appetizers before they signed the contracts!

The average American will buy or sell a home only 2-3 times during their lifetime. It is imperative to have a logical process to select a real estate agent. Purchasing and selling a dwelling for your family is a very emotional situation. If you chose an agent wisely, you will be confident that your Realtor is on your side through the entire purchase and/or sale even when emotions are running high.

As a Realtor in Minnesota, I love assisting people to find the perfect home. My clients come from the referrals of past clients as well as open houses and other marketing avenues. When I meet a potential client, I expect questions about myself and my business. I answer additional questions about the Twin Cities metro real estate market and specifics about homes available. Not all of these potential clients ask relevant questions. They can already be caught up in the emotional buying process or a major life change. Here is a great step-by-step approach to selecting the perfect Realtor for you. Part one of this article outlines how you can prepare yourself to set up meetings with potential Realtors. Part two will give you specific questions you can ask of potential agents so that you can make a good decision.

Step ONE
Ask YOURSELF these six questions?

Who do you trust for advice?
Is it a parent or grandparent? Maybe a close friend or uncle? Or is it your sibling or boss? Think about the qualities that person possesses and why you look at them as an advisor. If your trusted advisor is your grandfather, you might prefer working with someone older. If you tend to bring your problems to your best friend, you might want a Realtor with similar characteristics to your friend.

How demanding are you?

If you are an impatient person who needs answers as soon as you think of a question, you will need a Realtor that is available to you. If you are more laid back, you might prefer a Realtor with a similar style.

Do you prefer to use email or the phone as your main source of information?

Some Realtors are very computer savvy and will answer an email within the hour. Others answer emails once a week or less. There are Realtors who return calls only one time a day or week. There are others that always answer their own phone and others that have an assistant to field calls and answer basic questions.

Are you into gadgets?

If you are listening to your Zune while you surf the net on your wireless laptop, you might prefer working with an agent who presents your market analysis in a Powerpoint presentation or emails it to you in a pdf file. If you prefer a paper document to refer back to and make notes on, a Realtor with more a more traditional style might be what you need.

Do you have expensive tastes and exclusive brands? Or are you more conservative?

If you like the finer things in life, you might prefer a Realtor who drives a BMW and signs your contract with a Mont Blanc pen. If you are more conservative, a Realtor in a Ford F250 that uses personalized ballpoints might be more your style.

Step TWO

Now that you have answered these questions, you have a bit of an idea as to what you are looking for. Armed with this information, it is time for the second step. Research websites of potential agents BEFORE you meet them. Read their profiles and determine what their style is. If you cannot ascertain their style from their site, move to the next agent. There are hundreds of good agents out there. But if they cannot market themselves, how will they be able to market your home? Come up with a list of 4 or 5 potential agents and visit your state’s department of commerce website to check for violations on each potential agent’s record. Also, check independent local sources like the Mpls/St Paul Magazine’s listing of Super Agents.

Now you are ready to interview the potential agents. Get some great questions ready so that you can find the best Realtor for you. Having trouble coming up with great questions? Real Estate Agent Selection Primer—How to Choose the BEST Realtor for YOU! (Part Two of Two) will give you some advice.

Friday, February 16, 2007

Zillow—Valuable Tool or Inaccurate Values?

When Zillow first hit the web last year, I was intrigued. Wells Fargo Bank had previously offered a similar tool on their website but it was no longer available. When I checked out Zillow, I wasn’t surprised to find that similar to the bank tool, the numbers were only accurate in areas where homes were similar in age, design and lot size. If you live in an eclectic neighborhood with radically differing styles of homes, near a lake or in the country, the value could be off by thousands. So when I checked it out, I took the information with a grain of salt. After all, the value of my own home since it is located in the country was based on its sale price from 10 years ago and its current tax value.

Evidently the Wall Street Journal Real Estate Journal had some of the same observations as I had with Zillow. Recently they looked at 1000 recent home sales transactions in seven different states and compared them to their “Zillow Zestimates”. According to the article, “Zillow came within 5% of the price in a third of the transactions studied by The Journal. It was more than 25% off target on 11% of them. In 34 of the 1,000 transactions, Zillow was off by more than 50%.” There was an overall median difference between the actual sales price and the Zillow estimate of 7.8% which is very close to the margin of error Zillow estimates at 7.2%. Read the entire article at

For certain homes in certain areas, Zillow is a great tool. I recently visited the site and was surprised at how their service had expanded during the past year. Not only could someone find an estimate of value for a home but there is a listing search as well. Buyers can search homes that are currently listed, both FSBO and with Realtors. There are color photos, aerial views, street maps as well as values. As an agent, I will only be listing homes on Zillow that fit the criteria where an accurate “Zestimate” will come up. But it is a tool I will use. My clients were impressed as it was another avenue to bring in buyers.

Zillow will not replace the knowledge and expertise of an experienced real estate agent. But for quick values for homes with similar styles built in many city developments, it is surprisingly accurate. With all of the added features and information, Zillow can be a useful tool in the right hands.

Thursday, February 15, 2007

Affordable Minnesota Lakeshore

So you are once again dreaming of a lake home? The Land of 10,000 Lakes translates into millions of feet of shoreline in the state of Minnesota. But often it seems as only the very wealthy can live on the water’s edge. Is that an accurate perception? Stop dreaming and consider a few options that will make paradise more affordable.

Channel Shore
Shoreline along a channel is a great option for a full recreational lake. Many large lakes will have channels or narrow extensions that lead to other lakes or ponds. Usually there is not a place for a beach but you can have a slip or short dock for your boat. The channel will provide access to the main lake. The view will probably include homes on the opposite shore of the channel but if your goal is affordable use of a full recreational lake, this is a great alternative.

Smaller Lake with Channel to Full Recreational Lake
Often the lakes in Minnesota are connected to one or several smaller lakes. This can be a great opportunity. Shoreline that is shallow or weedy is not considered prime but if it has access to a larger lake, it could provide the same enjoyment at a much lower price.

Small Acreage Lake
Smaller lakes can be of interest to the more laidback water lover. Often there will be restrictions disallowing motors or only small motors. These smaller lakes can still be great for fishing, canoeing, kayaking and swimming. Some will allow docks and beaches but check with the DNR for specific restrictions. A small lake will still offer wonderful natural views at a significantly lower price than a full recreational lake.

Environmental Lakes and Wetlands
Very shallow lakes wonderful for privacy but not great for recreation. If you are looking for a home with awesome views of wildlife, this may be something to consider.

Deeded Access
Many homes and associations near a full recreational lake have been developed with deeded access providing use of the lake. The ability to have a dock, use the beach, or moor a boat, will be outlined in a legal agreement specifying what uses are allowed. Not all deeded access is created equal! Request a copy of all of the specific uses and rules before writing an offer so you can fully understand the access available as a home owner.

Lake View
A home with a beautiful lake view but no shoreline or lake access, can provide the wonderful picturesque views everyone dreams of without the high lakeshore taxes.Location with Public Access NearbyA final option is to look for a home that is near park with public lake access. I sold one such home where the public access to a good-sized full recreational lake was about a quarter mile down the street. This family uses the lake to canoe, cross country ski and fish without driving or trailers. There was none of the additional cost or taxes associated with lakeshore property but all of the benefits!

Lakes and Shoreline Link
Department of Natural Resources Lake Finder Comprehensive search engine to find information regarding the size, depth and condition of Minnesota lakes by county and lake name. There is even information on approximate numbers and types of fish found in the listed lakes.

Wednesday, February 14, 2007

Forget Jack! This is the House Students Built—Forest Lake High School Students—And Now its For Sale!

Carpentry shop class is NOT what it used to be in Forest Lake, Minnesota. Not content to build a shelf or piece of furniture, these construction students put their knowledge of math, engineering and construction and met the challenge of building an entire house in the school parking lot.
“This is a real world project that helps them see the importance of what they are doing in school,” said teacher, Kevin Rivard. “There are a lot of good jobs for kids who are not college bound. This allows them to get the feel for trades and to apply the skills they learn in school to do real things.”

The students had expert and professional assistance throughout the construction process. Professional contractors volunteered their time and talents to work directly with the students on the electrical, plumbing,
flooring, drywall and cabinetry. They learned to install everything from a bathroom vanity to an asphalt roof.

The one story rambler has been built on a 2-sided block foundation and designed to be easily moved. It is a 3BR/2BA home with 1352 finished square feet. It features a private master bath, custom oak cabinets, laminate flooring and Andersen Windows. All kitchen and bathroom fixtures are installed and plumbed. The home meets all Minnesota state building codes and has passed electrical and plumbing inspections.

It is truly a unique and impressive project and now it is For Sale!

The call for bids is out and the home will be sold on March 15, 2007 at the Forest Lake School District office. Bids will be opened at 6 pm. At that time all bidders will have an opportunity to increase their bid by submitting a final sealed bid at 6:30 pm. There is a minimum bid requirement of $49,900 (plus MN sales tax of 6.5%). Each bid must be accompanied by a check for $1000 as security. For additional information on the bidding process contact Larry Martini at 651-982-8125 or visit the Forest Lake District website at
Interested parties will have the opportunity to come and inspect the home on two different occasions prior to submitting a bid. The house will be open for inspection from 1-3pm on Sunday February 25, 2007 and from 9-11 am on Saturday March 3, 2007.

The home has to be moved from the school parking lot to its new location no later than May 30, 2007. It’s a great opportunity as there are more than 25 lots listed on the MLS within 20 miles of the Forest Lake High School priced between $60,000 and $120,000.

Tuesday, February 13, 2007

Staging for a Quick Sale—Cleaning for a Buyer!

Clean! OK, that seems easy enough. Most people clean on a daily or weekly basis but now you are selling your home. People who don’t know you will be walking into your home and assessing your property to determine if it is a place that they want to bring their family into. This means you need to clean until the place SHINES. And yes that does mean before every showing and open house.

So sellers scour the sink and clean the carpets and put up the for sale sign. But after the first few showings, their Realtor calls with feedback from potential buyers. Unfortunately, this can be where sellers find how good their preparation really is…When you’ve work for days and are told the house is “dirty”, what a slap in the face.

So let’s take a look at what is often overlooked by eager sellers and not overlooked by potential buyers!

Refrigerators—Clean inside and out! Remember a different family is going to keep their food in this appliance and they don’t want it to be repulsive! Throw out half-eaten food or store in sealed storage containers. Get rid of that moldy orange way in the back behind the drawer. Throw away that weird mustard that came with last year’s holiday basket. Take down all notes, magnets and papers from the outside and clean any discoloration. If they are not essential, don’t put them back on. Tuck them in a drawer or throw away. Carwax works well on white, smooth appliances to remove yellowing. Remove all drawers and shelves and clean until all grime is removed. Open the doors and check along the inside edge—especially note the rubber molding around the edge where food and spills can collect.

Range/Ovens—Clean your stove from top to bottom, inside and out. Use non-abrasive cleaners to remove all of the stuck on food from the range top. If it is stained and/or damaged, consider replacing. Clean the microwave and oven. Yes, potential buyers will look inside. If you are storing crackers and cereal inside, it doesn’t say to the buyer, this person can’t cook. It says the microwave doesn’t work! If there is burnt-over or rotten food inside the oven, it says, this family doesn’t clean!

Bathrooms—Take an honest look at your shower and the flooring around it. If it looks substandard to you, it will look gross to a potential buyer. Remove old discolored caulk and put it new. Open the toilet lid and make sure that it is clean inside. And it goes without saying that one pair of dirty underwear on the floor can blow the whole deal!

Walls—Wipe down walls by often used light fixtures--Especially if you have little ones. Also, move that trash bin in the kitchen and towel in the bathroom and check behind. It may require some scrubbing. If the stains cannot be removed, consider repainting.

Basements and Garages—These just cannot be a dumping area for all of the things you don’t know what to do with! Clean them out so that potential buyers can open the doors, walk around and see all the way to the corners. If you have to store some items in your garage or basement, they need to be boxed and stacked neatly with plenty of room for a buyer to see what the foundation looks like.

Litter Boxes and Kennels—Pet areas must be cleaned every day and before every showing. Beautiful homes are not considered if it appears that the pets have destroyed the home. If there is an odor, sellers assume it will not go away simply by removing the pet. They assume that the smells have permeated the floors and walls. If possible, let your pet stay with a trusted friend during the duration of the sale of your home.

Light fixtures and Vents—Look up! Sellers often spend hours on their hands and knees scrubbing the corners and sweeping the floors but forget to look up toward the ceilings.
Dirty ceiling fans and light fixtures are commonly overlooked by sellers but not buyers. They turn on that fan you haven’t touched in six months and all of the dust and dirt is suddenly airborne. Remove the glass from every light fixture and clean off the grime. Wipe down every blade on every ceiling fan. Vacuum the top of every curtain and drape. Check every corner for cobwebs. Remove every vent whether bathroom or air return and wash in mild soapy water to remove the dust.

So, if your home is not selling it’s time to get going. Take another look around your home from a buyer’s point of view and let’s get cleaning.

Saturday, February 10, 2007

Are You a BUBBA?

Most people, whether in the real estate industry or not,have heard of a FSBO, For Sale By Owner, seller. The acronym has been used for quite awhile as there has always been a segment of the market that chose to sell their home directly to a new buyer. But, there's a new acronym being used by Realtors these days--BUBBA or Buyers Unrepresented By a Buyer's Agent. It is making it's way into the real estate agent vocabulary because this market segment is growing.

In 2006, according to the National Association of Realtors 2006 Profile of Home Buyers and Sellers, nearly a quarter of all sales (23%) were BUBBAs. Although many of these home buyers did work directly with a builder or at a sheriff's foreclosure sale, 9% purchased directly from the home seller.

The internet is probably the most contributing factor to the growth of this buying segment. Buyers are certainly more educated--shopping on-line for as many as 6 months prior to making their house purchase. The homes are listed on the web. There are guides as to how to purchase a home. The whole process is less mysterious and seemingly simple that many self-educated buyers are foregoing working with a Realtor.

Are You Considering BUBBA? Before you move forward unrepresented, here are a few things to consider.
BUBBA can cost more. Buyer's representation does not cost anything. But can save thousands. When you sign a contract for buyer representation, your agent owes specific fiduciary duties to you to work in YOUR best interest. They are required to keep your information confidential. A Realtor does this as a profession, not once every 10 years like most buyers. They are experienced in negotiating a deal on a home that is in your best interest.

So how does a buyer's agent get paid? Every home listed in the MLS states a commission agreed upon by the seller with his agent to be paid to the buyer's agent of the particular home. Yes, the seller pays the fee for you to your agent.

But this does raise the question, "If I buy directly from the seller and he doesn't pay a commission, won't I get a better price?"

Probably not. Think about it this way, the seller set the price in the first place. If he is not working with an agent, how can you be certain that you received a good price on the home? And why would a seller, who doesn't know you, give you the savings he intended to pocket by not hiring an agent.

In this buyer's market, with so many different homes to choose from, it is easy to be overwhelmed in the purchasing process. What if the seller is has a charasmatic personality who uses a three year old refinancing appraisal to set his price? Is it a good deal?--Probably not.

Buying a home is not as simple as walking into a discount store for a new computer...And that can be overwhelming. There are details to a purchase that many home buyers just don't anticipate. How old is the roof? When can we take possession after closing? Is the septic system in compliance or does it need to be replaced? Are there encroachments, like a neighboring fence or driveway sharing issues? Are there assessments pending and who will pay for them?

All of these are situations an experienced Realtor will try to anticipate and resolve in writing as the transaction moves toward the closing.
Some people are accidental BUBBAS. They start out in a "learning" stage...That time period of six months to years where they are "dreaming" of a new home but don't want to commit or be pressured into a contract. They wander into an open house and it IS their dream home. Since they didn’t have an agent when they first came in, they feel uncomfortable informing the seller that they want representation and just move forward without one.

As a Realtor, I try to coach potential clients into developing a relationship with an agent early in the process. If you want to see a home, contact that agent and sign a contract for a specific house. That way your interests would be represented, if the house is perfect for your family. But you would not be locked into a 6 month contract, if you are not ready to make a decision.

Before becoming part of this growing trend in home purchasing, do research and carefully consider your options. You may be giving up more than you think to when making the one of the most important financial decisions of your life.

Friday, February 9, 2007

Homes! Not just a place to live…A Smart Investment

When my husband and I bought our first home, we didn’t really have our financial future in mind. We were going to be getting married and needed a place to live. After 4 years of college and sharing dorm rooms and rental houses with friends, we knew that a lease wouldn’t work for us. Without any financial planner’s advice, we instinctively made one of the best financial decisions of our lives…One that would affect our bottom line net worth for years to come.

Recently, I got together with four single women friends from high school. It was interesting to see how their financial paths differed over the past 20 years. All four started out with similar degrees from four year colleges. The four started with similar salaries but in different industries. The two gals who purchased their homes were doing much better economically than the two who continue to live in apartments. As a Realtor, this intrigued me and I decided to look into it a bit further.

Homes are Smart a Investment for Anyone

According to the Federal Reserve Board, VIP forum, your net worth is directly tied to whether you own or rent a home. The statistics are astounding:

According to, the national wage for the average American worker is $40.409. If an average American owns his/her home, chances are that his/her net worth will be 12 times higher than your renting coworker. Even at a low income, you can have significant net worth, if you own your home.
Stop Increasing Your Landlord’s Net Worth
With every rent check you send in, your landlord gets a little richer. And you don’t. It is that simple.

Many young single people are waiting for the “right” time to buy a home. Single women don’t want to buy a home and “put down roots” until they are in a permanent relationship. Single men don’t want feel tied to a house or community. This is old-fashioned thinking. The mortgages products offered today allow almost anyone with a stable income to purchase a home. Whether you are married or single, man or woman, the earlier you become a homeowner, the more financially stable you will be.
So what does this mean to the average American? Don’t wait!
Are you a college student? Consider buying a home near campus and rent out rooms to other students. Your renters will often pay your mortgage!

Single with limited funds? Start small and consider roommates. Remember as a homeowner, you will be responsible for maintenance and repairs so figure all costs into your budget when making your decision.

Think you may relocate soon? If you won’t be staying in the area for three years, it may be best to rent. If you currently live where the rental market is active, you may want to purchase and keep as an investment if you have to move.
Be Smart! Treat Homeownership Like an InvestmentMaintenance is essential for your home to accrue in value. Periodic updating and basic home care is required. You have to keep the gutters clean and the roof in good repair. The heating system needs to be serviced and the exterior painted or stained to avoid weather damage. A good home repair book will give the first time homebuyer a guide to the routine maintenance required for your home.

Of course to continue to accrue net worth, this does mean that you need to keep the equity “IN” the home. Avoid enticing offers to refinance with 0% down so that you can take a vacation or buy a new car. Using an equity loan can be beneficial to you if you are using for home upgrades, remodels or to purchase a second home for recreation or investment.

Want to learn more?

Contact me! As a Realtor I can help you through the buying process and set you on the path to homeownership. In Minnesota, the buyer doesn’t pay an additional fee to use a Realtor. Sellers traditionally pay the Realtor fees. And the advice from an experienced real estate agent is invaluable to find the home that best meets your needs and situation.

Copyright 2007 Teri Eckholm

Thursday, February 8, 2007

Home Staging Tips to Help YOUR Home Sell in a Slower Market

Let’s face it; many real estate markets are experiencing a slow down the likes of which we haven’t seen for years. For a home seller this means setting the price right. But equally important is the concept of home staging. The first step is back to the basics: unclutter, fix and clean! But what is the second step and third?

In the Twin Cities market buyers have on average 25-50 homes that will meet their needs. A typical showing day with buyers will mean visiting 7-10 homes and buyers do get confused. As the day wears on, buyers start to distinguish homes by their characteristics. Some descriptions are not flattering. Recently I was with a buyer who was remembering homes as “the lizard home” and “ one with the Nasty bathroom”. That day there was also the house with “neon green room” and the ever, unpopular “retro house with the orange counters”. So what can you do to make your home memorable for the right reasons?
Paint ProperlyIf adjoining rooms are painted in the same color palette, hour home will appear more spacious. Don’t take short cuts. If you don’t have time or patience to properly tape trim and ceilings, hire a professional. Painted woodwork and ceilings are noticed and sometimes worse than not painting at all.

Go Luxurious
Invest in accessories to accent your home. Big, fluffy coordinating bathroom towels and mats warm up the bath. Fresh flowers on a beautifully set dining room table look inviting. A color-coordinated rug in the foyer will make a wonderful first impression.

Cush-up the Carpeting
Don’t replace the carpet on the cheap. Invest in the BEST padding you can find. Buyers will in most cases have to remove their shoes when walking through your home. In their stocking-feet, they will feel the difference!

Make it Match
Slipcovers are a quick and inexpensive way to update and coordinate mismatched furniture. Put away the old blankets and cozy up the room with a beautiful accent throw and a few pillows.
Empty the ClosetsMake certain the closets are neat and organized. Replace and paint any shelves and organizers that appear dingy.
Replace Handles, Knobs and SwitchplatesInexpensive yes; but often overlooked. Handles that are outdated or missing and switchplates that are dirty or worn send the wrong impression. If they are replaced to look new and shiny, it shows that you pay attention to the details of your home.

Pack the Personal Items
The Elvis collection has to be packed! Likewise, take down the annual school photos of Junior from age 5 to 18. Use the “3 in any direction” rule. No more than three accent pieces should be able to be seen in any direction. Anymore than three is a distraction. If your photos or collection was on the wall, remember to patch the holes and repaint.

The Sun Shines When Windows Sparkle
In feng shui teaches that windows are consider the “eyes of the home” Make sure your windows are sparkling clean inside and out. Avoid the use of vinegar as a cleaner, as the smell may linger.

Before you scoff at spending money on a home you no longer plan to live in, remember this...It is still your home until it sells. It is in many cases your biggest financial investment. Consider it as a small investment for a big pay off or in this case, sale, in the end.

Wednesday, February 7, 2007

Taking "BUILDING" Blocks to a New Level--Real Estate used to send messages!

Did you realize that every building has it's own unique shape from above? Who would have thought that some of those shapes would resemble letters of the alphabet!

This is an amazing new way to look at real estate! The creators of must have stayed up many nights searching out aerial views of buildings to find a shape resembling each letter. When you view each letter or building a Google map indicates where the structure is located. Many are in the U.S., but some are located in other areas of the world.

Just type in the message and the program does the rest to create your message using the top views of the buildings. The site has a cool feature allowing you to email your friends' a unique greeting. A fun way for both kids and adults to get their message across. And with the Google map feature, they just might learn something.

Tuesday, February 6, 2007

It's COLD out there...Time to think about Carbon Monoxide Safety

With the subzero wind chills of the past few days, more Minnesotans have been hunkered down in their homes with the fireplaces roaring and furnaces blowing away. Unfortunately, some fellow Minnesotans will be exposed to carbon monoxide during this cold snap. In the past five years more than 2500 people have been hospitalized and 140 people have died from carbon monoxide poisoning in Minnesota. There are simple and inexpensive ways to protect your family from this deadly poison. The time is now to take those steps!

So what is carbon monoxide and where does it come from?

Carbon monoxide (CO) is a gas produced when fuels like coal, wood, natural gas and propane are burned. This gas cannot be seen and does not have an odor. In a properly ventilated home, CO gas would go up the chimney flue and not accumulate. But poorly maintained appliances, tuck-under or attached garages, and even heavy cigarette smoke can cause a build up of CO when there is not proper ventilation. When homes are tightly sealed against the elements, there is a higher risk of poisoning.

How can I tell if I have been exposed to Carbon Monoxide?

That's the sad thing about CO poisoning. Most people die or become seriously ill because they think they have the flu. The initial symptoms are similar: nausea, headache, fatigue. When a person has been seriously exposed there is confusion. This combined with severe drowsiness is often a lethal combination as the affected person or persons cannot think straight and often just lie down and go to sleep without knowing that they are being poisoned.

In January 2007, a new law took effect requiring that all new homes and apartments constructed in Minnesota to have carbon monoxide detectors installed within 10 feet of each bedroom. Existing homes will be required to have them in 2008 and existing apartment buildings by 2009. But don't wait for the law to take effect. Protect yourself and your family by purchasing a CO detector with an alarm. For less than $40, it is one of the best gifts you can give to your loved ones.

Monday, February 5, 2007

Extra Tips for Selling in Winter

A couple of weeks ago, I had to show a home on acreage early in the morning. It was January and we finally had a few inches of snow. Actually, more like half a foot of the fluffy white stuff had fallen overnight in the area where this home was located. From the agent's notes on the MLS, I knew the property was vacant, but had hoped the owner had the good sense to plow the driveway and shovel the walk. No such luck.

My buyers and I did get into the home. It had been recently "staged" and was spic and span. "Was" it is key word. We removed our shoes in the entry, but there was no rug or mat for our shoes. So the snow melted all over. I did look for paper towels, but since the home was vacant, the only towels available where the decorative towels hung by the stager to dress up the bathrooms. We knew that we could not use those. Unfortunately, we had to leave the entryway with water all over. I did contact the seller's agent and advise him of the situation as soon as we left. But this situation could have been prevented.

Here are a few extra tips for getting you home sold in the winter:

Shovel and salt. The outside of your home will always give the first impression. If it doesn't appear cared for with a shoveled walk and driveway, it sets the wrong impression. Make certain to shovel paths to any outbuildings or sheds that the buyer will want to view. Don't forget to salt or sand the icy spots. A rug or mat in the entry for shoes is essential during the winter months.

Light Up the Entry. Most showings during the week will in the evening. It gets dark at 5 pm in during the Minnesota winter months. There is nothing worse than have to dig out the flashlight in order to find the lockbox and key. If your home is vacant, install exterior lights with motion sensors or put on a timer so that evening showings aren't hazardous to your potential buyers.

Dust. With most forced air furnaces running around the clock, there is additional dust floating around. Make certain to change that furnace filter every 30 days.

Scent with Sense. Don't overpower the showings with strong scents. Try warming Cinnamon sticks in water on the stove just prior to the showing. Or bake cookies. Avoid too many air fresheners. Many people have allergies to these products. If it is too overpowering, they won't stay long enough to see the home.

Friday, February 2, 2007

Why Some House Flips are Flops

How did it happen? You spent months researching how to invest in real estate. You went to seminars, read books and magazine articles showing the easy way to buy properties to fix up and sell for profit. You may have worked with a great Realtor to find the perfect property or came across a FSBO that was a tremendous deal. After the closing you worked hard to rehab the home to sell quickly: fixed the plumbing, put in new cabinets or carpeting and repainted with neutral colors. Now the home is on the market and it is NOT selling. What went wrong?

Although I am aware that each situation is different, I would like to share a story of first time real estate investors gone wrong. If any part of the story starts to sound familiar, you might want to revise your real estate investment plan.

Two years ago, I was contacted by a couple for a market analysis on a property they were preparing for sale. I met with the owner at the vacant home. She was extremely excited because the home they had bought as an investment was almost ready to list. It had new flooring, paint, carpeting, cabinets and countertops in the kitchen and bath. I casually asked, “what made you take on this endeavor?’ The answer was quick and direct. “We are going to make a ton of money!”

I prepared the market analysis and came up with a market value of $299,000-309,900. About two months later the home was listed for sale by owner for $349,900 or 12-15% higher than I recommended. I decided to keep an eye on this house to see how the first time investor would fare.

The home was re-listed in August with a Realtor. However on closer inspection, the Realtor was the Mrs. Seller who just got her license. Sometime in October they decided to reduce the price to $299,900 but the summer selling season was over. Minnesota had entered a real slowdown in the market and the listing was cancelled in November.

I noticed the home again hit the market last fall. It was listed by a different Realtor but the tax records indicated that the owner was the same. The price was now $269,900 and the home in need of TLC and repairs. This time the home sold in a couple of weeks as it was a great deal.

So what happened? Based on my experience and what was going on in the market, I think these new investors attempted to be landlords when the home didn’t sell for the price they wanted. Renters can be very rough on homes and after rehabbing once, they didn’t have the heart to try again.

In my estimation, this couple may have just broken even but more than likely lost money. They had originally paid $240,000 for the home. They probably had invested a minimum of $7,000 in materials on the repairs that were originally outlined when I viewed the home for the market analysis. The home actually sold for $267,500 with the seller contributing $7,500 for closing costs. Add in a modest 5% commission of $13,000 (though it was more likely 6 or 7%), they may have broke even.

This is not an isolated case. I am tracking another home with another first time investor that I believe is headed down a similar path. It is not as easy to be a real estate investor as the infomercials would have you believe.

There is money to be made investing in real estate especially in the changing market with the high rate of foreclosures. But keep your expectations realistic. Work with (and listen to) an experienced Realtor when selecting a property to invest in. Do a cost analysis including all repair costs and compare to an estimate of what the refurbished home will sell when complete. Keep in mind that the market is always changing and plan accordingly. Have your Realtor do an updated market analysis prior to listing the home. If the market has changed, make certain that you price your home accordingly. Treat your investment like a business and stop dreaming of a “ton of money”. If you don’t adapt to the changing market and you price the home too high, it won’t sell.

Real Estate investing can be very profitable but it is not for everyone. If you are not prepared to work with professionals, listen to their advice, keep abreast of the market and change with the times, it may be best if you invest elsewhere.

Copyright 2007 Teri Eckholm

Thursday, February 1, 2007

Fearing Foreclosure? There may be help available.

Foreclosure is sadly, not as uncommon as it was in years past. The influx of ARM's and zero down financing and refinancing has put many a homeowner into this financial situation.

There is help out there for families facing foreclosure. The Foreclosure Prevention Hotline is an initiative to help those experiencing issues with their mortgages.
This is a service being managed by the Homeownership Preservation Foundation and employs 4 different credit counseling agencies to provide free counseling for consumers--all are HUD certified and have been trained in housing and credit counseling. The counselors can also act as a facilitator between the
consumer and the lender.

For additional information call 1-888-995-HOPE or check out their informative website at