Saturday, July 30, 2016

It’s a Seller’s Market in the Twin Cities, so Why should I pay a BUYER’S Closing Costs?


The market is hot and sellers are in the driver’s seat once again in the housing market. So why in the world would any one of them be expected to kick in for a buyer’s closing costs? 

One of the items on the seller’s estimate of proceeds included in every market analysis I do has a place for a “Seller's contribution to a Buyer’s Closing Costs.” I always include several thousand dollars as an estimate to prepare my clients that this could come up at negotiations. A significant portion of buyers, whether using  FHA , VA or conventional financing, will require assistance with their closing costs. 


Just the other day, a potential seller said that he didn’t think he should have to pay a first time buyer’s closing costs.  I had to explain to him that buyers in ALL price points, whether purchasing a first home or moving up to a second property, might ask for seller concessions. You might be asked in negotiations to contribute to a buyer's closing costs so they can BUY your house! 



After our conversation, I decided to see what how often homebuyers are asking for closing costs in the Minneapolis/St Paul north metro. I looked at the sales of single family residential homes in Anoka County during June 2016. Even I was surprised by the results, well over 50% of homebuyers received closing cost assistance during the month. But when I broke it down by price, I was even more surprised. I found that in the price ranges from $100,000-$400,000 more than 60% of buyers negotiated for the seller to pay some closing costs. And from $400K to $500K, over 50% still requested and received assistance. Even with homes sold at over $500,000, 1 in 4 buyers received seller paid assistance. 


I decided to look at all four north metro counties to see if this was just an Anoka County phenomena. Nope….nearly the same results when I reviewed the aggregate of sales for Anoka, Chisago, Ramsey and Washington Counties together. 


Why Do So Many Buyers Need Help? Today most buyers are required to put down a minimum of 3% of the purchase price of the home as a down payment. If a buyer wants to avoid private mortgage insurance using conventional financing, this will require 20% down. The closing costs for a buyer include title insurance, home owner’s insurance, appraisals, loan origination fees, name search fees, filing fees and more. As a REALTOR® working throughout communities in Anoka County and the north metro Minneapolis/St Paul area, I see these closing costs will run anywhere from $4000-$8000 and even more for more expensive homes. Add this amount with a required down payment and few buyers will have sufficient funds to purchase a home.


Understanding Closing Cost Assistance Buyers have the option of waiting and saving additional money to cover the down payment and closing costs or asking for seller assistance. In many cases a financial institution will allow a seller to assist a buyer by paying either points to reduce the interest rates and/or closing costs.


How does this work? Let’s say that a home is on the market for $200,000. The buyer writes their offer for $200,000 and their financial institution allows up to 3% seller’s assistance with fees and closing costs. They decide to ask the seller in their purchase agreement for $5000 in seller paid concessions, thus the net offer to purchase the home is $195,000. If the offer is accepted, the seller’s proceeds at closing would then be reduced by the $5000. Sellers do not have to come up with the funds in cash if there is sufficient equity in the home to cover both the buyer's and the seller's costs.


If a seller does not want to pay the closing costs, the buyer in many cases, will not be able to purchase the home. 

Sellers Can Still Receive a Full Priced Offer! Take that example with the home listed at $200,000, if a buyer wants to offer full price but needs $5000 in closing costs, he would just write the offer price at $205,000 . The seller's net offer is full priced.

When a seller looks at their home sale as a business deal where the bottom line is key, being open to assisting a buyer with closing costs is a very smart decision. As long as a seller is happy with the NET number received, it doesn't matter whether some of the proceeds went to pay closing costs or not. 
  
Need to know more about buying or selling a Twin Cities home? Let me be your professional guide. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of Boardman Realty, a call or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2016 www.terieckholm.com

The Benefits of an Indoor Sport Court in a Minnesota Home




Playing basketball outdoors in the summer has it's advantages.  Especially on  a perfect 75 degree day with puffy white clouds, a slight breeze and no humidity. However, in the dog days of summer when the humidity is tropical, the sun is scorching and the mosquitos are rampant, an indoor game might be preferred. 

This made me think of how awesome it would be to have a personal indoor sport court at home...climate controlled throughout all four seasons.  It is not just a dream idea either. Builders do design them into homes throughout the Minneapolis/St Paul metro. An indoor court at home would be a great place to for kids to blow off steam during torrential summer downpours or after school when snow is piled up along the driveway. It would also be awesome for any  aspiring athlete to have the ability to train on a daily basis for team tryouts? 

Scientific research shows that it takes 3 hours of practice daily over the course of a decade to raise a talented athlete to the elite status. Most aspiring players end up spending countless hours away from home training for their sport but what if those hours could be spent at home instead? This is one of the big appeals of an indoor sport court.

Families I know in the north metro have installed backyard batting cages for their kids with baseball and softball collegiate dreams . It's great for those on acreage with abundant space and for three of four season. But it doesn't provide any advantage in the winter. Spring baseball tryouts are usually well before all the snow has melted. There are few options for playing catch or practicing pitching in January and February. And similar situations arise for those who play golf and hockey.

There is one family I know with a couple of daughters in gymnastics and dance. This family repurposed a huge polebarn into a mini gymnastics practice facility complete with a beam and trampoline indoors. But due to lack of heat,  it lost it's appeal during the winter months. It's hard to warm up and perform when the temps are below zero in the barn.

This is a common issue for Minnesota moms and dads of young athletes. Where does a parent bring a child to get in that very important daily practice without jeopardizing time spent on schoolwork and other activities. Having a gym at home is would be very valuable to many sports minded families. 

This leads many to consider the luxury of an indoor sport court whether for our teens to enjoy a friendly afternoon of basketball or to practice and train for baseball tryouts. Indoor courts are can be designed to be very versatile spaces with something for every member of the household. They are fast becoming  a very attractive selling point in the luxury market but can be incorporated into mainstream homes too.

Is a indoor sport court worth the investment cost? That depends. Like any other home feature, it will only be worth it if it is used. But if you have an active family and it's winter in Minnesota, the odds are good that an indoor court could be the favorite room in the house.

FEATURED LISTING: North Oaks home with an indoor sport court!
A luxurious 4BR/4BA/4Car executive rambler with walkout basement and indoor sport court. Download flyer and take virtual tour here.



Need to know more about buying or selling a Twin Cities home? Let me be your professional guide. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of Boardman Realty, a call or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2016 www.terieckholm.com

Tuesday, July 26, 2016

What is the Value of My Ham Lake Home?



The Ham Lake summer market is HOT! Home buyers are still searching for acreage homes but few good, affordable options have listed in the north and east Minneapolis/St. Paul metro this summer. 18 homes have sold and another 26 are in pending within the city of Ham Lake's borders since June 1.  AND 8 of the active homes have an accepted purchase agreement tooCurrently there are 56 active homes listed in Ham Lake (49 previously owned and 7 new construction). About 25% of these properties are priced under $300K while most are priced at well over $500,000.

Are you planning to sell your home in Ham Lake, Minnesota soon? Do you need more information on where to start? 

When you need to sell a home in the Ham Lake area, I will help you get the process started quickly. My innovative marketing and top notch negotiating skills will get your property sold FAST and at the best possible price too.  A market analysis by a professional REALTOR® is your first step in the home selling process. It will give you an ACCURATE VALUE of your current home...not a quick computer generated one. 

Interested? Read testimonials from my sellers

Selling acreage is one of my specialties. I have 15+ years experience with septic systems, compliance tests, well disclosures and other rural real estate issues.

For additional information about working with me, contact me to obtain a FREE Home Value Report. Or better yet call me, Teri Eckholm/Boardman Realty 651-336-7073 and arrange a no cost/obligation market analysis on your home today.

FYI-- I do answer my own phone so when you call, you will be talking directly to me!



Copyright 2016 www.terieckholm.com

Gated Communities in the Twin Cities? Not Quite, but Close.

 
 In many parts of the country, there are gated communities with gate out front where entrance is limited. Some of these communities have a full time guard to watch the entry and allow approved guests in as necessary.

In the community of North Oaks, while not technically gated, the private road/no trespassing signs are not a joke. This unique development is not specifically a "gated community" but the roads are privately owned by the homeowners. Every entrance to the city is posted as a private road and there is a private security guard watching the entrance or patrolling the streets as necessary.  

North Oaks, originally a 5000 acre farm, was developed for upscale, mostly acreage properties, built around Pleasant Lake and the concept of persevering the natural beauty of the area. Though there are 600+ conservancy acres and 500 acres of residential open use land, the city owns no property. All parks, trails and recreational facilities are owned and maintained by the homeowners association. Each homeowner owns the road frontage to the middle of the street, effectively making all roads resident owned and private.

So what does this mean? If you have not been invited into North Oaks by a resident, you are quite simply trespassing. There is a sheriff that patrols the community on an exclusive basis. Interestingly, residents who are selling a home can only have “invitation only” open houses or private scheduled showings. Public invitation open houses are not allowed as residents must know specifically who is coming and going from their homes.


The residents of North Oaks take their privacy and private roads very seriously. With or without gates. 



Featured North Oaks Listing: 
 Stunning Rambler with 4BR/4BA/4+Car on 2 Private Acres.   CLICK HERE to take tour and download a flyer 


Need to know more about buying or selling a Twin Cities home? Let me be your professional guide. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of Boardman Realty, a call or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2016 www.terieckholm.com

Wednesday, July 13, 2016

Is YOUR Real Estate Agent a Dabbler?


A decade ago, during the first big real estate surge, I was an agent. I started in the business a few years prior to when everything exploded. I didn’t become an agent because there was “easy” money to be made. I transitioned out of a corporate marketing job to help people through the complicated process of buying and/or selling a home. And when the going got tough, I didn’t hang up my license or take up a part time job for cash. I was a REALTOR® and in the business for the long haul. 

Once again the housing market is strong. And with the strong market come hundreds of new agents (and those dusting off their licenses that have been on ice for since 2007). These dabblers are jumping back into the real estate game. Often they start by contacting friends and relatives to “help” them as their first clients. Is your agent one of these real estate dabblers

Why it Matters 

One of the many things I have learned is that real estate is a business of continuous education and change. REALTORS® who are in it as a profession learn something from every transaction and apply it to their next deal.  A new agent or one who sells a home or two a year doesn’t have that bank of education to draw from.  This helps with negotiation when reviewing offers and writing an offer that will make the cut in a multiple offer situation. This is essential when assessing properties with a first time home buyer and determining the best list price for a property. 

My experience helping home buyers and sellers whether their move was during a down market or in this most recent upswing is invaluable to my clients. I put this knowledge to work to help them make the best decisions for their situation. In the past few months, my expertise has saved my client’s thousands of dollars regardless of whether buying or selling. Dabblers don’t have this expertise.

Who do you want on your side? A seasoned professional or a dabbler?

READY TO MAKE YOUR MOVE? Let me be your professional guide. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of Boardman Realty, a call or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2016 terieckholm.com

Friday, July 8, 2016

It's a Crazy Market for First Time Buyers!




I haven't written a blog post since March. It's not that I have been slacking off or there is nothing to write about in the Minneapolis/St Paul real estate market. On the contrary, I have been just too darn busy writing offers for buyers. (And fielding them for my sellers). It is not a market where you write one offer per buyer when they find their perfect dream home. Oh no, I am talking multiple offers for the same buyers on dream home after dream home until they get an offer that is accepted.

First time home buyers are having the most difficult time with this market. They don't have time to think or process whether or not the house is a good investment. They have to make a decision and write up an offer immediately. And not just any reasonable starting offer, it has to be a good offer because 9 times out of 10, there will be multiple offers.

Advice for Home Buyers

1. Work with an EXPERIENCED Realtor. My 15+ years of experience means something. I know how to negotiate and write a good offer that will increase your chances of getting it accepted. There are tricks to this trade and an experienced agent will coach buyers to write the best offer for the situation.


2. Be Preapproved. Your offer will not be taken seriously if it doesn't have a pre-approval letter (or proof of funds when paying cash).

Advice for Sellers



If you are selling in this market, it might cross your mind that you do not need an agent. Statistics show that homes sell faster and for more money if it is listed on with an agent. There are numerous hiccups in a home sale that can arise in a frantic market like we are seeing in the Twin Cities metro. Not only is it difficult to assess multiple purchase agreements should there be more than one offer. Buyers rush writing offers to get in first. This often leads to buyer' remorse before the sale closes. There is additional negotiation that happens after the inspection. With a good agent by your side, a seller can focus on packing rather than dealing with the details of the closing process.

READY TO MAKE YOUR MOVE? Let me be your professional guide. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of Boardman Realty, a call or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2016 terieckholm.com