Tuesday, August 31, 2010

First Time Buyer Question—Is a Home Still a Good Investment?


Since the economy, in a word, tanked a few years ago and the values of homes in some areas plummeted, I often get asked the question, “Is buying a home really a good investment?" It was for decades considered one of the safest investments a person could make; the epitome of the American Dream. A few years ago, skyrocketing values seemed to put home ownership out of reach for many but with the market downturn many would be first time homebuyers are confused. Does owning a home make sense as a financial investment?

In my opinion, YES, buying a home is a wise investment and not just because I am a REALTOR®, but because I, too, am a homeowner. The key is treating your home like the investment that it truly is. It takes discipline and time for your investment to grow. And like any other investment, if you have to sell when the market is down, there is a chance that you will not realize as much profit as you may have expected.

So what are some of the key points that must be considered when investing in your first home?

  • Buy Smart
**Price **Interest Rate **Type of Mortgage **Resale Potential **Equity Builder?

  • Maintain and Protect Your Investment
**Home maintenance **Insurance
  • Don’t Put in Your Asset in Jeopardy
The best way to have a healthy balance sheet when you decide to sell your home is to Buy Smart in the first place. Buying smart is not just about getting the home at a low price though that is a very important piece to the puzzle. With many homes at rock bottom prices, it is a good time to consider buying a first home. But buying smart also means getting a mortgage that you can afford and that is safe, preferably at a fixed rate rather than an adjustable rate that can fluctuate into something that you cannot afford. Interest rates are at record-breaking low rates. Talking to a knowledgable loan officer is a great way to get started in the home buying process and find out what options are available to first time buyers now.

But buying smart goes beyond the price paid and the loan used to finance a first home. It is also buying with resale in mind. Many, who purchased homes in the price climbing frenzy of a few years ago, snatched up any home they could after submitting multiple purchase agreements on several homes. They didn’t worry about the perfect floor plan or that the home was on a busy road or next railroad tracks or if it had a weird small room that could not be used for anything. Now, if they are faced with trying to relocate, they are frustrated that buyers refuse to compromise on aspects that they overlooked.

As a REALTOR® who works often with first time buyers, I spend time helping my them to understand the positives and negatives of the location of each property they view. I point out how something quirky like having no basement or having a hot tub built in to a bedroom could affect the resale value by limiting potential buyers. Paint and wallpaper can be easily changed but foundation, plumbing and property location are much more expensive to deal with. Oddities it a home can drastically affect value when it is time to sell.

Lastly, buy smart by determining whether equity can be built with good old fashioned hard work! If the home hasn’t been updated, a good sprucing up could raise its value. A house that has an unfinished basement, could build equity if it can be done at a reasonable cost. Don’t take shortcuts and avoid permitting because that can be costly if you go to sell. Is landscaping your forte’? Look for a home with a yard that can be upgraded over the years. Just be frugal and realistic in what your resale will be in the end.

Beyond a smart buy, maintenance is essential as is proper insurance to be certain a home owner can afford the required repairs should the unexpected happen. Time after time I have to bear the bad news when presenting a market analysis at a home where the interior and/or exterior has not been repaired or replaced in decades. These homes are not worth what a neighboring, updated home is worth. Doing several projects over time allows a homeowner to enjoy the improvements while retaining the property value. Likewise, not insuring a home properly can be a huge risk. Worse yet, are the homeowners that make a home insurance claim and receiving payment for a repair but opt to use the money for something else.

Finally, it is important for a homebuyer to not put their investment in jeopardy. Many of the people who lost their homes in the market downturn put their homes in jeopardy but taking risky loans against the equity. Some people took home equity loans at reasonable rates but didn’t use the funds to improve their home. Some of these loans were at very high adjustable rates and as the payment rose, the homeowners just couldn’t make the payment. When I was growing up, I remember learning to never take a risk with anything you couldn’t afford to lose. I think a home falls into this category.

Like any investment, a home’s value will fluctuate. But a house is unique as an investment because it serves a dual purpose: It is a your place to live as well as a way to increase your net worth. By using the money that would be paid for rent and putting it toward a house you can afford with a plan to protect and maintain your property, a home purchase is still a good investment.




Copyright 2010 Teri Eckholm 

Thursday, August 26, 2010

Memories of the Great Minnesota Get Together—The MN State Fair Starts Today!


Did you feel it when you woke up this morning? That tingling of anticipation? That unmistakable rush of excitement when you heard that the gates opened at 6 AM this morning? If you did, you are undoubtedly a Minnesotan! Yep the cars and people started streaming onto the streets of the MN State Fair at the crack of dawn this morning. All the TV news programs were there showing what we could expect new in the line of food on a stick…or heart attack on a paper tray if you saw the chicken-fried bacon strips and deep-fried bologna. (But don’t worry…there is a health care booth on scene to check your blood pressure and heart rate!)

People who are not from our state don’t always feel the rush of nostalgia and longing for these ten days that wrap up our Minnesota summers. They don’t realize that our fair is a permanent location that opens to this huge EVENT just once a year! They have never had the opportunity to by a ticket and attend the evening concerts at the Grandstand. See a Dairy Princess have her likeness carved out of butter. Strolled through the horse, pig , and poultry barns to see the prized hog and sheep shearing competitions. Marveled at those daredevils in stunt shows or tried your own stunt by cruising on a burlap sack down the Giant Slide.

So as a REALTOR®, I like to entice people to consider relocating to Minnesota. We are not buried in snow year-round around here, ya know! It is a beautiful state with amazing and fun events…And the Minnesota State Fair is one of my favorites!

From my earliest memories, some of my favorite times were spent at the MN State Fair. It was a family event where we would meet up with our grandma, aunts and cousins. We would buy Salt Water Taffy, drink all the milk we could drink for a quarter (I think it is $1 now) and play games in the midway. There was the year my 5 year old brother stopped to look at a toy display and got lost…unfortunately, we found him. (Just Kidding...Love ya Mike!)
There was the year I went with my best buddy from high school for three days straight. As a college freshman at Hamline University, we were right across the bridge from the fairgrounds. During a lull in orientation weekend, I convinced several new friends from out of state to walk over and enjoy the last day of the event. A year later I went with my new boyfriend to four grandstand concerts in one week. He is now my husband and over the years we have seen several shows including Kenny Rogers, Rick Springfield, Eddie Rabbitt, Johnny Cash and Alabama….from the names of the bands you can tell we haven’t gone to a concert for a few years.

When my oldest was still stroller aged, we took him for his first visit to the fair. After a real-lemon lemonade, he took one of the pieces and stuck it is his mouth. And suddenly someone shouted, “Hey look at the baby sucking lemons!” Yep…people-watching is one of the favorite pastimes at the fair. It is especially scoping out people enjoying the tons of various foods...usually on a stick. I heard that there are 60 different food-on-a stick choices this year.

As the kids got older, we made it a point to stop at the Education Building to see the exhibits and collect all the free stuff from the colleges and organizations. Several of the pine trees the kids won from the forestry booth are still alive…though much taller…in our yard today. Another highlight was the Home Depot booth to build a souvenir. Sure you could do this on any Saturday morning if you were under 12 at a local store but it was so much more exciting to do it at the fair!
See that is the joy of the Minnesota State Fair…Everything is more exciting there. It is quite an event. Twelve glorious days at the end of summer to people watch at its best. It ends Labor Day so hurry!










Copyright 2010
terieckholm.com

Sunday, August 15, 2010

Top Ten Reasons People LOVE to call North St Paul Minnesota Home!

The Minneapolis/St Paul area is made up of dozens of cities, suburbs and communities all with a style of their own. I wanted to showcase some of the dynamic features of each community I work in so people relocating to the area could learn more about what makes the town special. The first northeast metro suburb I have featured is my hometown: North St Paul. There is so much more North St Paul Minnesota has to offer than being home to the world's largest snowman! Take a look and see the top ten reasons people love to call North St Paul home!




If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me a call or visit my website for a FREE Relocation Packet , Homebuyers Success Packet or sign up for Listingbook Twin Cities Home Search. I specialize in acreage and lakeshore properties in the north and east Twin Cities metro area including Ham Lake, Lino Lakes and all communities in the Forest Lake School District! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.



Copyright 2010 Teri Eckholm http://www.terieckholm.com/

Friday, August 13, 2010

Drought Over! Will MN Lakeshore Prices Rise with Lake Levels?


As we prepare for another round of potential thunderstorms this morning, I began to wonder how this summer’s rainstorm after rainstorm has affected the drought conditions that have been plaguing Minnesota for several years. It is no secret to anyone living in the area that the 10,000+ Minnesota lake levels have been low over the past few years as we watched docks get longer to reach the water at lakes throughout the state. There was more than one local news report over the past few years warning boaters to be cautious when touring local lakes for underwater hazards due to low water levels. But this summer we have been blessed (or cursed to those affected by the flash flooding) with abundant rainfall! Last night alone, rain gauges across the Twin Cites with outstate areas boasting several inches. Eagan, Minnesota located just south east of the Minneapolis/St Paul airport had a whopping 3.97 inches of rain last night!

So how have the summer storms of 2010 affected the Minnesota drought? In a word, significantly!

According to this cool tool,
the drought impact reporter, Minnesota has gone from being categorized as100% abnormally dry or worse last year to no drought reports anywhere in the state! As early as 6 months ago, several counties across the arrowhead region of Minnesota were reported as extremely dry. Hopefully this is a step toward our lake levels coming back.

The good news is prices on lakeshore have been as low as the lake levels this year! Though few lake shore homes are in foreclosure, the down market has caused many sellers that need to sell their prized lakeshore for rock bottom prices. In many cases, list prices are down tens of thousands lower than in previous years.


Here are just a few DEALS on lakeshore homes that I have noted across the north and east Twin Cities metro this past week:

  • 4BR/2BA 50’ Shore on Coon Lake in Ham Lake listed at $235K
  • 2BR Forest Lake home with 75’ lake shore on Clear Lake Listed under $230K
  • 2BR/2BA home with 55’ Shoreline on Forest Lake listed for $250K
  • 3BR/2BA on Bald Eagle Lake, acre lot and 175’ shore listed for $500K
FEATURED LAKESHORE HOME
278 Janice Ave, Shoreview MN 3BR/2BA on private lot, update with view and access to full recreational Lake Wabasso $329,900
CLICK HERE to Take Virtual Tour
For additional information on these or any other lakeshore home in the Minneapolis/St Paul area, call or text Teri Eckholm, REALTOR® with RE/MAX Specialists at 651-336-7073.
If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me a call or visit my website for a FREE Relocation Packet , Homebuyers Success Packet or sign up for Listingbook Twin Cities Home Search. I specialize in acreage and lakeshore properties in the north and east Twin Cities metro area including Ham Lake, Lino Lakes and all communities in the Forest Lake School District! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.




Copyright 2010 Teri Eckholm 

Sunday, August 8, 2010

Almost Speechless Sunday--Going Above the Crowd at the Minnesota State Fair!



RE/MAX real estate professionals are known to go above the crowd...usually in the famous red and white balloon. (Okay, if you want to see the balloon pictures I took in White Bear Lake last year, click here.) But I took the opportunity to take a quick trip above the crowd on the Skyride, one of the permanent fixtures at the Minnesota State Fair, last summer. Quite a view that shouldn't be missed if you are going to the fair this summer!

If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me a call or visit my website for a FREE Relocation Packet. I specialize in acreage and lakeshore properties in the north and east Twin Cities metro area including Ham Lake, Lino Lakes and all communities in the Forest Lake School District! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.

Copyright 2011 www.terieckholm.com