How to sell your home in the dead of winter

SMART MOVES: ELLEN JAMES MARTIN

Are you planning to sell your home during the normally austere period at the opening of the year? Don't hesitate, says Mark Nash, a real estate broker and author of the forthcoming book "Real Estate A-Z for Buying & Selling a Home."

Many prospective home buyers wait several weeks after their holiday bills are paid before venturing out on a property tour. But, as Nash points out, every season has its determined buyers. "Depth-of-winter buyers are especially assertive," he says.

Whether 2007 will indeed prove a strong year for home sales is subject to debate among housing analysts. Skeptics note that many prospects are nervous about the stability of home values, citing the large volume of unsold properties in many communities.

"For those who hold prime properties, any time of the year is the right time to sell — including the dark winter months," says Joan McLellan Tayler, a real estate author and former realty company owner. "Some homes are so exceptional they're snapped up quickly under any circumstance. Others can take longer to move in the winter."

Here are several tips for homeowners on making the most of a post-holiday sale:

Pick a listing agent who has weathered several post-holiday cycles. Whether or not you're selling in a popular part of town, Nash says it's especially important to hire an agent with an established track record. Occasionally, a sage agent will suggest that a home's sellers briefly defer an early-winter sale because of adverse market conditions. But Nash says most homeowners should resist the urge to postpone.

Though it's tempting to wait for the early-spring selling season, Nash says homeowners should remember the costs connected to hanging on. If you must move due to a job transfer, a divorce or some other life transition, don't underestimate the costs of keeping up a vacant house. Not only must you meet your mortgage payments, but also your insurance and utility bills.

Let your interior lead the way to a quicker wintertime sale. After New Year's Day, your first challenge should be to remove any remaining remnants of holiday decor. "Holiday decor says to buyers that you aren't prepared to move out so they can move in. It clutters and detracts from the home," Nash says.

Once the decorations are gone, Nash urges homeowners to go on a cleaning crusade, purging the property of superfluous items and then rendering it dust- and spot- free.

Homeowners without a design-trained eye might consider investing in the services of a property "stager," a professional who helps rearrange and augment the sellers' furnishings for maximum appeal to visitors.

Lighten the look of your walls. For several years, America has had a love affair with forceful hues in homes. And many owners are happiest living with high-energy paint colors — the kind they see used on the home-redo shows they watch on TV.

"But most sellers forget that marketing a home is not the same as living in one," says Nash, who stresses the importance of freeing a home of its heavy paint colors before attempting to sell. Also, avoid using bold paint colors when repainting.

When repainting your walls in preparation for a sale, you needn't pick sterile white to lighten and neutralize your look. Good choices include linen-like tones with just a hint of another pleasing color, such as yellow, brown, green or blue.

Generate talk about your wintertime sale. Clearly, excitement is in shorter supply for many people during January and February than in the weeks leading up to the winter holidays. So it's often helpful for you and your listing agent to use a creative marketing strategy.

Nash, who sells homes in the Chicago area, tells the true story of one Illinois couple whose listing agent was stumped on how to attract home shoppers to what he describes as their "blah house" when it went up for sale last February.

What finally worked was a "Garden of Eden" theme, in keeping with the fact that the homeowners were avid gardeners. Though their flowerbeds were buried in snow, the agent asked for photos showing their flowers blooming in summer. These were enlarged to poster size, mounted on tall easels and placed next to windows throughout the property.

"The 'Garden of Eden' created buzz among neighbors, real estate agents and horticulture groupies in the darkest days of early February. I think we all loved the break from winter; it was so bright, hopeful and cheery," Nash recalls.

No matter the time of year, creative marketing won't make up for an overly steep price tag or a property in poor condition. But it can help tantalize shoppers and their agents into seeing a home they might otherwise have ignored.

CONTACT ME TODAY for More Tips on SELLING YOUR HOME!

The Real Estate Market is Looking Up!

Market correction may have nearly run its course, but it's not full speed ahead

Where does the real estate market shakeout leave us in 2007? Sellers can't command 2005 prices, but buyers can't expect lowest-ball offers to always work.

What's the shape of a post-bubble, post-correction real estate market? And more to the point: What does that mean for you in the new year?

Those questions are becoming increasingly relevant as the latest sales data show a small but unmistakable uptick in activity and declining unsold inventories. In late December, the National Association of Realtors reported that existing home resales were up by a hair in November -- 0.6 percent -- the second straight month of modest increases off the cyclical trough in September.

On Dec. 27 the Commerce Department reported sales of new houses rose 3.4 percent over the previous month, while builders' unsold inventories dropped to their lowest level since last February.

All of which suggests that the 18-month market correction that followed the four-year housing boom has just about run its course. From a national statistical perspective, we're somewhere near slack tide -- but no one's looking for another frothy high tide anytime soon.

Some local markets are moving contrary to the relatively flat national trend. Three dozen metropolitan areas -- primarily markets with moderate prices and solid employment growth -- were still racking up low double-digit house price inflation at the end of the third quarter of 2006, according to federal data. Dozens of others -- primarily where unemployment has been an economic drag -- showed continued signs of modest deflation in home values.

In the main, however, the housing market appears to have weathered the correction phase of the cycle without the blood running in the streets that some bubble-bust bears had forecast. Median prices of resale houses have fallen 3.6 percent nationally year-to-year, and anecdotal reports of 10 to 20 percent asking-price reductions in formerly hyperinflated markets are commonplace. But that's what corrections are all about, as opposed to outright busts.

Moderate price cuts also eventually stimulate buyers -- who'd been sitting on the sidelines wondering when the market might bottom out -- to wade back in and start shopping again. That's where we appear to be at the moment, and where we're headed in 2007, absent unexpected economic jolts to the global capital markets that could send mortgage rates spiking. In that event, all bets are off.

So what are smart strategies in a slowly recovering real estate environment for heads-up buyers and sellers? One good rule: Think baby steps instead of big leaps. Sellers shouldn't assume that with the trend line turning positive they can suddenly price their house for what they might have commanded in early 2005. Forget about it. In most places, buyers still have the upper hand. There's plenty of inventory to choose from, shoppers are picky, and unrealistic pricing is a guaranteed route to sitting dead in the water for months, unvisited and unsold. Be real on pricing. And be happy there are buyers out there again.

On the other hand, smart shoppers should recognize that the game is changing, the spring buying season is just on the horizon, and that lobbing low-ball offers at already marked-down properties isn't a winning strategy. If you are seriously in the market, be prepared to pay a price that might not be as low as you'd hoped, but that just might be your last shot at a particular house before it sells for closer to the asking price a few weeks from now.

Shoppers also need to understand that today's prevailing mortgage rates -- a little above 6 percent for 30-year money, and the high-5 percent range for 15-year loans -- are less than a point above 40-year lows. They won't be around indefinitely, so a fairly priced house combined with a near-historic low-cost mortgage adds up to a potentially great deal.

A second essential for the emerging market: Smart buyers and sellers need to be well-informed. They need to plug themselves into all the key local data that shape pricing and deal-making -- time-on-the-market, inventory declines and increases, the overall pace of sales, and the average gap between asking prices and closing prices. Be in command of these numbers and you will be well equipped to play heads-up ball, whether as buyer or seller.

A lot of this data is available online and offline from realty websites, regional or local multiple listing services, Realtor associations, and mortgage lenders and brokers. It's also available person-to-person from the front-line experts on any given micro-market: the realty agents who "farm" specific neighborhoods or market segments. They make their living, in up cycles and down cycles, by listing, selling and thoroughly knowing what's happening inside their target areas.

Better yet: There are no commissions for information from these specialists. All you need to do is show that you're serious and you can compile a lot of valuable market intelligence for free.

IF YOU WANT INFO ON THE CURRENT MARKET CONDITIONS CONTACT ME TODAY FOR A FREE CONSULTATION!

Wells Fargo Economists Optimistic about 2007 Economic Growth

Despite the current economic slowdown, Federal Reserve interest-rate increases, home price declines, higher oil prices, and the war in Iraq, Wells Fargo’s senior economists forecast U.S. economic growth in 2007.

“The [stock] market’s recession fears are overblown and the U.S. economy will reveal incredible resilience in 2007,” said Dr. Scott Anderson, senior economist for Wells Fargo & Company, during the company’s annual economic forecast teleconference. A Webcast of the call is available through Jan. 13, 2007.

“The drivers that had been pulling down the U.S. consumer and economy in the first half of 2006—such as rising energy prices and interest rates, sluggish wage growth, and a sharp drop in housing demand—began to recede or stabilize in the second half of 2006.”

“We’ve still got fiscal juice,” said Dr. Jim Paulsen, chief investment strategist of Wells Capital Management. “We’ve had mortgage rates come back down in the last half of the year. We’ve had gas prices come down. Liquidity is growing over 9 percent year over year. We have a weaker dollar. All of that is juice for growth next year.”

“The decline in home prices hasn’t yet resulted in a decrease in consumer confidence and spending, or a general decline of household wealth and it’s unlikely to occur next year,” Anderson said. “The housing slowdown has been offset by strong stock market wealth, so household wealth continues to grow.”

Inflation and gross domestic product growth

Gross domestic product growth is expected to rebound as soon as next quarter. Paulsen said he predicts a 3.5 percent growth rate for 2007 based on his expectation that the housing and auto markets will flatten out. Anderson said growth will accelerate in early 2007, reaching an annualized quarterly growth rate of about 2.8 percent, from recent annualized quarterly rates of around 2.0 percent.

“Lowering interest rates under current conditions is like throwing more fuel to an already burning fire. What the Fed needs to do today is encourage U.S. consumers and the government to save, not consume,” said Wells Fargo senior economist Dr. Eugenio Aleman.

Labor market

“New legislation on minimum wage could put pressures on the cost of labor, adding to the already serious concerns on the labor market,” Aleman said. “The strong movement against immigration could further complicate prospects for some industries that have thrived under the ‘no intervention’ policy by federal authorities.”

“Job growth appears steady outside the weakening auto and housing sectors,” Anderson said, “and payroll growth over the past year rose substantially, suggesting a healthy and tighter labor market.”

He said that continued job growth and improved real wage gains will help consumer spending withstand the lagged effects from Fed rate hikes, high debt-service burdens and energy prices.

Energy

The war in Iraq is still unpredictable and many forces could put more pressure on the price of petroleum. “Commodity markets are going to go higher next year with a weaker dollar,” Paulsen said, “but oil is still overpriced in relation to other commodities.”

Consumer spending

Anderson said there are tentative signs that consumer spending and housing demand is responding to the improved financial picture. He forecasts a 3 percent growth rate in consumer spending next year, down from 3.1 percent in 2006. Besides higher real wage growth, drop in energy prices, and easing of financing costs, Anderson said he sees little prospect for major wealth loss in average households.

Some economists have said home price declines could to lead to a general decline in household wealth that would put a crimp in consumer confidence and spending, but Anderson said that level of lost wealth has not yet occurred and is unlikely to occur next year.

Housing market

Anderson said most of the damage in the housing market already has occurred and there are signs of recovery—mortgage purchases are up about 15 percent since the beginning of November. Existing home inventories have plateaued over the last four months, and the Wells Fargo National Association of Home Builders index has held above its September low for three consecutive months with builders reporting an improved sales outlook.

Investments

Paulsen predicts next year will be another good one for the stock market—with stock prices likely rising. He also sees good profit trends, investment liquidity and expects that long-term Treasury yields will remain at 40-year lows.

Global economy

The economists agreed that the U.S. dollar’s steady depreciation against the country’s major trading partners will become an important theme for next year.

“Strong growth in China and India are contributing to downward pressure on many goods, however, at the same time, the entrance of these countries’ large populations to the mainstream consumer market are helping push commodity and petroleum prices up. Thus, the net effect on global inflation is still uncertain,” Aleman said.

Wells Fargo’s Economists offer their economic analysis at: www.wellsfargo.com/com/research/economics/ and www.wellsfargo.com/com/research/investments/.

Note: Comments by Wells Fargo’s economists during the teleconference are their own opinions and should be attributed to them as individuals, not to Wells Fargo & Company.

More 2007 Predictions:

Real estate: Listing glut of 2006 may shrink

The real estate forecast for 2007 focuses on "absorption,'' as some sellers step back and more buyers step forward.

By Jim Buchta, Star Tribune

In a stagnant housing market, optimists already are calling 2007 the year of recovery.

"To me, the stars are all starting to align," said Todd Shipman, outgoing president of the Minneapolis Area Association of Realtors. "It won't be a boom year, but we're back on track."

Is that shameless optimism or an educated guess?

Shipman, a sales agent with Sky Sotheby's International Realty in Edina, said several facts point to a turnaround: Mortgage interest rates are lower than expected, the inventory buildup has started to slow and housing affordability has risen to its highest level in more than a year.

Still, the market will face plenty of challenges during the coming months, including increasing mortgage foreclosures, stagnant home prices and a glut of homes for sale.

According to a forecast released Thursday by the Minneapolis Area Association of Realtors, the number of closed home sales in the Twin Cities metro area during 2007 is expected to increase only about 1 to 2 percent, with the median sale price -- the point where half sell for more, half for less -- increasing about the same amount.

"It's going to be a slow recovery," Shipman said.

Still, those are enviable numbers compared with overheated markets such as Boston and Las Vegas, where median sale prices have fallen more dramatically.

Nationwide, existing home sales during 2007 are expected to decrease just 1 percent compared with 2006, according to the National Association of Realtors. In addition, the median sale price is projected to rise only 1.4 percent during 2006, to $222,600, and only another 1 percent during 2007.

"It should be a rather unexciting year in real estate," said George Karvel, professor of real estate at the University of St. Thomas in St. Paul. "The most exciting part will be that it should not be as hyperactive as it had been."

Absorbing a big supply

The theme of the coming year will be absorption, as sellers step back to avoid stiff competition and buyers step forward to take advantage of low interest rates and seller flexibility.

Karvel said that during the recent five-year run-up in prices, future demand was satisfied, leaving a dearth of buyers and too many listings.

At the end of the December, a seven-month supply of existing homes was on the market in the Twin Cities metro area, according to the Minneapolis association's weekly housing-supply outlook.

Mark Allen, association CEO, is confident that inventories will level off in the coming year, as home builders slow the pace of new construction. There will be fewer "opportunity sales" of the type created in recent years by the strong demand and double-digit price increases.

Allen predicted that the inventory level of 2006 will be a record, with new listings falling slightly during 2007 to the second-highest ever.

Home builders, who have experienced one of the worst years in a decade, are expected to see some improvement during 2007 as buyers regain their confidence -- and sell their existing homes.

Nationwide, the Commerce Department said that at the November sales pace, it would take 6.3 months to sell the nation's entire inventory of new homes.

"I think we're all feeling quite cautiously optimistic that the worst is behind us," said Wendy Danks, marketing director for the Builders Association of the Twin Cities. "Builders have paid attention and have stopped putting things in the ground" if they don't have buyers.

Through November, the number of planned new units in the Twin Cities metro area was down almost 26 percent compared with the first 11 months of 2005.

David Lereah, chief economist for the National Association of Realtors, predicted that sales of new homes will fall 17.7 percent in 2006 and then fall another 9.4 percent during 2007.

That shift is directly tied to the number of existing-home sales, as prospective new-home buyers delay their purchases for fear of not being able to sell their existing homes.

Plus, the high cost of new construction makes less-expensive existing homes all the more attractive to budget-conscious buyers.

Condo supplies are high

The condo market, which has been sagging under the weight of excess supply and has contributed to the bulk of all new construction in the metro area this year, has been particularly vulnerable.

But Tom Melchior, multifamily real estate analyst for Larson, Allen, Weishair & Co., said there could be a very modest turnaround in the condo market during 2007 as sellers get more realistic about pricing and unsold inventory finally moves.

"It won't be a great year, but it will be better than 2006," Melchior said.

Based on current demographic trends and buying patterns, he expected the pool of condo buyers to remain steady during the coming year but the supply-demand ratio to equalize somewhat as the number of new projects dwindles.

Whether buyers are shopping for new construction or existing homes, it's going to be a standout year, particularly for those who were priced out of the market during record sales periods and are now able to take advantage of seller discounts.

On Thursday, the National Association of Realtors said that home sales in November dipped 10.7 percent compared with November 2005, pushing the median sale price down 3.1 percent. That was the fourth monthly median-price decline and an indication that sellers are dropping prices.

The association predicted that mortgage interest rates will gradually increase during 2007, but marginally, to 6.7 percent for a 30-year fixed rate mortgage, by the fourth quarter of 2007.

Still, for some, the hangover isn't going to subside anytime soon. Sellers will struggle, buyers will worry and builders will hope.

And it's also going to be a year of reckoning for people who bought at the peak of the market a year or two ago and have to move, for homeowners with adjustable-rate mortgages they can't afford, and for buyers with subprime mortgages that they can't pay.

Subsequently, foreclosure rates are expected to rise dramatically as modest appreciation rates make it difficult for some people who are forced to sell to recover what they owe on their mortgages.

"For some people this hasn't hit home," said Tom Musil, director of the Shenehon Center for Real Estate at the University of St. Thomas.

"People got used to prices going up and up and up. ... This is when the reality comes to your doorstep."

HAPPY NEW YEAR!

Predictions

It's that time of year when EVERYONE starts looking at their own Crystal Vall to determine what the New Year has in store. Here's what the Minneapolis Area Association of Realtors predicts as well as what I think is going to happen. We'l see in the end who is right!

Minneapolis Area Association of Realtors Predicts:

Home sales will rise 1 to 2 percent and record inventory levels will dip.

Median sale prices are expected to rise 1 to 2 percent during 2007.

Mortgage interest rates should top out at 6.7 percent for a 30-year, fixed-rate mortgage by the fourth quarter of 2007.

T. J. Larson Predicts:

Home sales will rise 5 to 6 percent and record inventory levels will remain steady.

Median sale prices will rise 4% percent during 2007.

Mortgage interest rates should top out at 7.1 percent for a 30-year, fixed-rate mortgage by the fourth quarter of 2007.

What do you think? If you are considering buying or selling...give me a call! I'd love to hear from you!

From Mercury News:

Real estate update: Seasonally adjusted rays of hope


In a small sign that the nation's housing market might be turning up, sales of existing homes edged higher in November, according to a report today from the National Association of Realtors.
Sales of existing houses, condominiums and co-ops were up 0.6 percent on a seasonally adjusted basis from the month before to an annual pace of 6.28 million homes, the Realtors reported. However, that rate was still down sharply -- 10.7 percent lower -- than in November 2005. And the median home price of $218,000 was down 3.1 percent from a year ago.
The number of homes on the market, meanwhile, dropped 1.0 percent, leaving a supply that would last 7.3 months at the current sales pace.
``It looks like we may have reached the low point for the current cycle in September,'' David Lereah, the Realtors' chief economist, said in a statement. ``We've entered a more sustainable period of home sales now, and we expect greater support for prices over time as inventory levels are eventually drawn down.''
Market conditions are tilted more toward buyers than sellers, Realtors said. Buyers are benefiting from a plentiful supply, relatively low mortgage rates and sellers' willingness to negotiate on price and other terms of a deal, the group said.
Today's news on existing-home sales follows Wednesday's report from the Commerce Department that found unexpected strength in new-home sales. Even so, economists expect more price cuts in the new-home market as builders try to sell off their inventory.
Mortgage rates climbed this week, but 30-year fixed-rate loans still remained slightly below where they were a year ago, according to a report today from Freddie Mac.
The mortgage giant said 30-year fixed-rate loans were at 6.18 percent, up from 6.13 percent last week but down from 6.22 percent a year ago.
``Mortgage rates edged up over the week following news of a jump in consumer spending in November,'' Frank Nothaft, Freddie Mac's chief economist, said in a statement. ```Financial markets were concerned that stronger spending could keep inflation elevated. These worries were further compounded by the releases of new and existing home sales for the same month, which both exceeded market forecasts and caused Treasury bond yields to continue to rise.''
Rates on other popular loans:
• 15-year fixed-rate mortgages: 5.93 percent, up from 5.89 percent last week and 5.76 percent a year ago.
• One-year adjustable-rate mortgages: 5.47 percent, up from 5.44 percent last week and 5.15 percent a year ago.
• Five-year hybrid ARMs: 5.98 percent, up from 5.96 percent last week and 5.76 percent a year ago.
The usual fine print: Here in super-expensive Silicon Valley, where many buyers need jumbo loans, the rate you pay may very well be higher. And most buyers pay up front a percentage of the loan value, known as points.
For more real estate news, check out our Square Feet blog.
A huge legal victory for AMD over Intel, or really not that big a deal? It depends on which Silicon Valley microprocessor maker you ask.
In a statement today, Sunnyvale chip maker Advanced Micro Devices wanted to make sure we all know about Wednesday's ruling by a federal judge in Delaware requiring Santa Clara rival Intel to turn over documents about its international business practices to a court-appointed special master.
``Intel's acquiescence to the special master's findings is a big win for AMD,'' Thomas McCoy, AMD's executive vice president for legal affairs and chief administrative officer, said in a statement.
AMD filed an antitrust lawsuit against Intel in June 2005, contending that the larger chip maker abused its global market power by coercing computer makers not to buy AMD processors. Intel, for its part, has acknowledged it had a huge lead in the market, but has said that's because it was a more reliable supplier.
Intel, meanwhile, told the judge it wouldn't object to the special master's recommendation that it turn over the documents. For that matter, Intel noted that it hasn't been decided yet whether the documents will be admissible as evidence in court.
``There's a long road ahead of us,'' Intel spokesman Chuck Mulloy told Bloomberg News.

It was a Better Year in Real Estate Than You Might Think!

Here is an interesting perspective on the 2006 Real Estate Market.

2006: It Was A Very Good Year

The end of the year is at hand and with it some relief. Despite claims of an impending real estate bust that will rival the Great Depression, for the most part 2006 merely represented a slow-down from the torrid and unsustainable pace of 2005.
According to the National Association of Realtors, annualized home sales as of October -- the last figures available at this writing -- were expected to reach 6.24 million, a very good year by most standards but down 11.5 percent from 2005. As to prices, by October 2006 they were down 3.5 percent nationwide when compared with a year earlier -- but many metro areas actually showed strong price gains: As of the third-quarter NAR reported that of 148 metro areas, 21 had double-digit price increases for the year, 102 had price gains, 45 had declines and one was unchanged.
For the year, the National Association of Home Builders reports that on a year-over-year basis, total housing starts were down 25.5 percent in November. Permits during the month -- a strong guide to future construction activity -- were 31.3 percent below a year ago.
To put matters in perspective, while 2006 sales were off from 2005, it's fair to say that 2005 was a ridiculously-good period; a perfect combination of low rates, supercharged real estate activity and easy financing. No doubt 2006 price levels and sale activity would have been seen as astonishingly good not too long ago.
Sales and prices would have been in far worse shape during 2006 had interest levels risen. Figures from Freddie Mac show that interest rates for 30-year fixed-rate loans topped out in late July at 6.8 percent while in mid-December the same loan could be had at 6.12 percent, a significant decline. Relative to rates seen during the past 45 years, 6.12 percent is very much toward the bottom. (And for the record, yes, I thought rates in 2006 would breach 7 percent, if not more.)
Why interest rates have stayed so low is an outright mystery. The federal government has added at least $1.5 trillion to the deficit in the past five years. Trade with other nations is upside down -- we spent $432 billion more than we took in just during the first six months of 2006.
Given that capital is so much in demand you might expect interest rates to rise. Such an expectation is firmly within the realm of logic and reason and yet rates have fallen since this summer. Higher rates would not only impact sales and pricing, they would also jolt many current owners with ARM financing because the indexes used to calculate ARM rates move up and down with the short-term marketplace.
Move indexes a little higher and borrowers today who are at the cusp of affordability might find themselves awash in mortgage debt they cannot support. To relieve the pressure of higher monthly costs, many of these owners would be forced to sell with some speed and lots of concessions. More homes on the market would increase supply and thus push down prices.
There are some who argue that 2006 has been a trough of sorts and that with a growing population and a strong job base we will see a return in 2007 to a stronger market with more sales and higher prices.
While a marketplace renewal would be delightful, one cannot ignore the possibility of higher mortgage rates and the continuing and widespread use of toxic loans -- those interest-only and option ARMs that now finance so many transactions. The routine use of stated-income loan applications, applications where income is typically not verified, is also a source of apprehension.
It hardly seems like a coincidence that toxic loans were first popularized around 2001, that many had five-year start periods during which time borrowers could make tiny payments and that in 2006 -- five years later -- we saw a vast increase in foreclosures, up 68 percent in November from a year ago according to RealtyTrac.
Rather than worry about national trends it's best to look at local values. It's useful for property owners and would-be property owners to speak with nearby brokers once a year. Such "tell me about the market" sessions can include a careful look at local sales in the past year, community trends and new factors which may impact area home values such as a nearby school opening or road construction. (And for brokers, it's a chance to meet new folks and reconnect with long-time residents.)
You might be surprised by what you find. In my community, according to Metropolitan Regional Information Systems (MRIS), November unit sales were down 19.6 percent from a year ago -- while average prices were up 1.64 percent!
Go figure. With such contrary results it's hard to explain the present much less predict the future.

More Evidence Twin Cities Property Values on the Rise Compared to Suburbs!

Minneapolis and St. Paul rank among the nation's top cities in housing-value gains from 2000 to 2005, compared with surrounding metro residential areas. Median value, owner-occupied housing, 2005

1. Chicago $245,000 $233,500 105% 18%
2. Minneapolis 226,900 235,900 96% 17%
3. Boston 420,400 394,800 106% 15%
4. St. Paul 200,100 235,900 85% 13%
5. Atlanta 218,500 177,200 123% 13%
6. St. Petersburg 166,500 163,300 102% 11%
7. New York 449,000 419,200 107% 11%
8. St. Louis 103,300 141,800 73% 11%
9. Seattle 384,900 290,200 133% 11%
10. Oakland 487,300 655,300 74% 10%

*Percent increase in the city's ratio with the metro (Minneapolis: 82 to 96 percent, a 17 percent increase )

People Continue to Move INTO Minneapolis/St. Paul

Urban flight is a MYTH.

More and more people realize the benefits of living in the urban core of the Twin Cities.

And why not? What with all of the tremendous variety of arts, restaurants, night clubs, shops, parks, lakes...Minneapolis and St. Paul really has it all AND you don't have to drive in a soul crushing freeway commute if you live and work in the city.

Here's an article from the cover of today's startribune.

After years of "white flight" to the suburbs, Minneapolis and St. Paul are leading a nationwide urban comeback.

Kathy Arnell didn't have just your typical annoying 45-minute commute from Champlin to Minneapolis. When Arnell, a registered nurse, was on call for 24 hours at a time, sometimes she made the commute twice in one day.
"When our children graduated from high school," said her husband, Brian, "we were gone -- and we haven't looked back."
Today it's a quick hike to work for both of them from their new downtown loft, with its 17-foot ceilings and breathtaking views of a glittering Minneapolis skyline and summertime fireworks along the Mississippi River.
With that move, the Arnells became part of what's shaping up as one of the nation's most remarkable urban comebacks. By two key measures -- rising home values and attractiveness to affluent white families -- Minneapolis and St. Paul rank among the few cities rebounding so far this decade, census figures show.
Among the nation's 40 biggest metro areas, both cities rank among the top five in value increase of owner-occupied homes, according to a research team at the University of Virginia. And both are among the top 10 in the rate of increase in the median income of white families -- a key indicator for sociologists tracking the return to cities of well-heeled folks blamed for "white flight."
Not everyone is celebrating. Property taxes and foreclosures are rising. Houses with a history are being bulldozed for what some call "monster homes." Homes that immigrants could buy for $40,000 in the late 1990s now cost more than four times as much. Affordable rentals are being converted to condos. Poverty is rising in the suburbs, faster than in most metro areas nationwide.
Overall, a plus
But analysts tracking these changes say the side effects can be managed, and the upgrade in the end is worth it.
"Suburbs have been eating the cities' lunch for so long that when you see it going in a different direction suddenly, your first impulse is to think there's something 'wrong' here," said Alan Berube, research director for the Metropolitan Policy Program at the Brookings Institution in Washington. That's "because nothing in your lifetime has gone right in the city. But I don't think something bad is happening here. It's a rediscovery of urban assets that have been undervalued for decades."
Call it a coastal effect
Today Minneapolis and St. Paul are benefiting from some parallel trends, including an overheated housing market on both coasts.
"In Santa Barbara today, a million dollars gets you a dump, a shack," said Jennifer Newton, a 34-year-old writer, who along with her husband, Christopher, a 33-year-old computer programmer, bailed out in 2004.
Weary of paying nearly $2,000 a month for a nothing-special apartment in Southern California, the couple drew up a 13-point list of needs and launched a quest for an American city that could fulfill them.
They landed on a street called Margaret, on St. Paul's East Side, paying $199,000 for a house that had changed hands 12 years earlier for $68,000. Today the couple proclaim themselves "deliriously happy transplants." They've bought ice skates and find the rink next to St. Paul's stately Landmark Center to be practically European in its winter magic.
Less crime, more culture
Some factors behind the rebound are true of many cities nationwide. Crime has eased since the early 1990s. Downtown cultural attractions have multiplied. Older baby boomers are returning to city life after raising kids in the suburbs -- and the kids themselves are choosing cities, too.
If the rebound is faster here than most places, experts say, the factors probably include:

• One of the nation's fastest rising levels of traffic congestion, frustrating folks long accustomed to easy mobility.
Scott Hughes works in construction management and is often on the road. He and his fiancée -- he's from Burnsville and she's from Bloomington -- landed in south Minneapolis partly because when traffic is thickest, "I am usually going the opposite direction," Hughes said. "And when I have to head downtown, I am already close."

• A high percentage of older homes.
Character and craftsmanship are often mentioned as important draws by recent buyers in city neighborhoods, and University of Virginia researcher William Lucy has documented that, city or suburb, the presence of pre-World War II homes is a huge draw.
Lauren Mihajlov, a marketing manager, said she left Champlin for the Cedar Lake area of Minneapolis partly for "a house with character that's not like every other in the neighborhood. ... Between the commute and the 'five-styles-of-homes-available-in-this-development' -- all beige! -- I thought I was going to lose my mind."

• Aggressive spending by state and regional agencies, as well as nonprofit groups and corporations.
On the Minneapolis riverfront alone, "the level of public investment was huge," said Mark Bjelland, a geographer at Gustavus Adolphus College in St. Peter, Minn., who has studied the transformation. Riverfront land now occupied by lawyers and corporate executives, he recalls, was once considered so worthless that its owners gave it to the government rather than pay taxes on it.
Understanding the risks
Crime and city schools remain hurdles for many, and cause some to leave after making the jump. But most people understand that going in.
Cyndi Harper and her husband, who make more than $100,000 a year between them, left their Roseville apartment in the fall of 2000 for a first home in the Willard-Hay area of north Minneapolis.
"My husband's brother and his family were living six blocks away, so we knew what we were getting into," she said. A big attraction was the price: "We would have paid $100,000 more for the same house in another neighborhood."
Six years later? "So far, so good. We are happy with where we live."

If you are considering a move, contact me today and I can help you get started!

HAPPY HOLIDAYS!

From my darling Lily Margaret (9 weeks) to you - Happy Holidays Everybody!

Home Ownership is Possible for EVERYONE!

Home for the holidays

For the first time, the Dixon family will celebrate the holidays in their own home. Think it's impossible for you? Dreams do come true.

Last February, Michael and Johanna Dixon and their five children moved from a confined, cockroach-infested apartment to a renovated four-bedroom home with gleaming hardwood floors in north Minneapolis.
It wasn't until he got the keys and walked around the house a couple of times that Michael knew it was real: He and Johanna owned a home, a first in both of their families.
"I was just blown away," he said. "Owning a home is a big monument in my life."
The Dixons are one of the many families at home for the holidays this year with the help of the dozens of nonprofit organizations in the Twin Cities.
They paid $190,000 for a house they bought through the Minneapolis Community Development Agency's Home Ownership Works (HOW) program, which makes rehabilitated homes available to buyers who meet income eligibility requirements.
To increase their buying power and help make their mortgage payments more affordable, the Dixon's took advantage of first-time home-buyer financing. The HOW program provided a $30,000 deferred mortgage that doesn't have to be paid back for 30 years or until they sell their home.
Since moving in, life has changed for the Dixons. They have the space to entertain family and friends, which they plan to do during Christmas. They're actively involved with the block club, and they've made new friends, including their neighbor, "Miss Kathy," who bakes cookies with the kids and helped them decorate their bikes for the National Night Out parade in August.
"I can tell they have a sense of pride," Johanna said of her children. "To me, owning a house is like starting a foundation for wealth in our family."

Is Now the Right Time to Refi?

Here's the latest from Kenneth Harney of the Washington Post:

Rush to refinance makes sense for some borrowers

Attractively low mortgage rates mean it might be time to refinance -- if you fall into one of several categories of homeowners.
By Kenneth Harney, Washington Post Writers Group
You might be thinking Christmas, Hanukkah, Kwanzaa and sugarplums, but thousands of your fellow homeowners have been thinking refinancings, rate reductions, cash-outs and money-saving debt consolidations.
For the past two weeks they've been bombarding lenders with applications for mortgage refinancing -- driven by the most attractive rates in the marketplace in more than a year. Refinancings were up in mid-December by 60 percent over the same period last year, and they accounted for more than half of all new home mortgage applications -- the highest since the spring of 2004.
Thirty-year fixed rates slipped below 6 percent two weeks ago, and although they've rebounded slightly, they are still nearly a percentage point below where they were last summer. Fifteen-year fixed-rate loans in the mid-to-upper-5-percent range are readily available to applicants with solid credit.
Could a holiday season refinancing be in the cards for you? Maybe, but it probably depends on whether you fit into one of several categories where today's rates make a lot of sense:
• You have an adjustable-rate mortgage that's facing a "reset" into higher payments in the six months ahead. Your loan might be a payment-option mortgage, an interest-only mortgage originated in 2003 or 2004 with a three-year reset, or simply an adjustable tied to sort-term Treasury rates that's already costing you more than the fixed-rate alternatives.
• You have a "piggyback" first and second mortgage package that was originally intended to let you purchase your house with a minimal or zero down payment while avoiding mortgage insurance premiums. But now the floating-rate second is above 8 percent and you want to bail.
• You need cash for a home improvement project, a business investment or to buy a vacation home that's now available at a bargain price. Even though the fixed rate on your first is below 6 percent, the opportunity to cash out thousands of dollars and refinance into a larger replacement first percent is compelling.
So many current homeowners fit into these categories that Anthony Hsieh, president of LendingTree.com, the online network of 200-plus mortgage companies, predicts that this month's refinancing boomlet could stretch into 2007 -- provided, of course, that rates remain close to 6 percent.
"This [boom] has legs," he said. "This is no head fake, it's for real" because mortgage money at 6 percent offers such exceptional problem-solving opportunities.
For example, Douglas Duncan, chief economist for the Mortgage Bankers Association of America, estimates that $1.1 trillion to $1.7 trillion of adjustable-rate mortgages are scheduled for payment resets in the coming 12 months, and that $600 billion to $700 billion is likely to be refinanced by homeowners eager to avoid higher monthly outlays.
Some of these loans are "nontraditional" mortgages that combine low initial payment periods with drastically higher payments after several years. For thousands of those borrowers facing big payment jumps -- 50 to 100 percent and even higher -- a refinancing into a fixed-rate mortgage is a no-brainer, according to Duncan.
Other people who purchased during the housing boom years using popular "3/1" adjustables in the mid-4-percent range for the initial three years now face significantly higher payments because short-term interest rates today are much higher.
Consider this example provided by LendingTree: Say you bought your house in late 2003 with a $200,000 "3/1" adjustable at 4.375 percent with a margin of 3.75 percent and a 20 percent down payment. Your principal and interest payments have been $998.57 for the first three years. But now you face a reset into a 7.53 percent rate on your $197,000 balance -- and a monthly payment hike of $383.
Your heads-up alternative: Refinance into a new 30-year fixed-rate $197,000 mortgage at 6.1 percent. Sure, your payment will be $196 higher than your current 4.375 percent rate, but not what you'd pay if you stuck with your current loan's post-reset rate.
Here's another scenario: Say you have a great rate on the $200,000 first mortgage that you took out in 2002 -- 5.5 percent. But you need $25,000 cash for a kitchen remodeling or business investment. On the one hand, you hate to get rid of a once-in-a-lifetime 5.5 percent rate. On the other hand, you have the opportunity to pull out the $25,000 with a refinancing, add it to the $192,500 balance on your current loan, and walk away with a new $217,500 replacement mortgage at 6.1 percent fixed for 30 years.
Your new monthly payment: About $184 higher than your current.
A Christmas gift from Santa? Hardly. Cash-out refinancing costs money. But your 6.1 percent fixed rate -- not far above 40-year record lows -- should still look good years from now.

Profile of Summit-University Neighborhood!

Elegance restored, history preserved

The Summit-University neighborhood in St. Paul offers interesting character and a variety of home prices.

After eight years of living in California, where real estate prices are sky-high, Charles Goenner knew he'd found a deal in the Summit-University neighborhood of St. Paul: a decrepit 1880s Victorian-style house on Dayton Avenue.
"I thought, 'someone has to save this house,' " he said.
Goenner moved in and started renovating. That was more than 20 years ago and since then, much has changed in the neighborhood.
Goenner's story is common in Summit-University, which now has some of the Twin Cities' grandest homes.
But it hasn't always been that way. During the 1950s and 1960s, many once-grand houses fell into disrepair after a wave of residents fled to the suburbs.
Other homeowners simply lacked the resources to fix up those houses, many of which are now among the most expensive in the Twin Cities.
Realtor Steven Rosnow, a former Summit-University resident who has been selling homes in the area since 1997, said that history is the neighborhood's biggest draw.
"It's surely the most historic neighborhood in the Twin Cities," Rosnow said, noting that most of the housing stock was built before World War II.
"The neighborhood has come a long way," he said. "A lot of people have spent most of their adult lives working to better the neighborhood."
Summit-University's southern boundary is Summit Avenue, which is lined with elegant Victorian-era mansions. Other historic areas within the district include Cathedral Hill and Ramsey Hill.
Because many of the original mansions, rowhouses and brick apartment buildings have been converted to condominiums, home prices are diverse. They ranged from $69,900 to $1.7 million during the past year, according to the Minneapolis Area Association of Realtors.
The neighborhood is also popular because of proximity to shopping and restaurants along University and Selby Avenues.
Goenner on restoring his home and living in Summit-University:
What drew you to the house? I had never thought about living in an old house, but once I found it, I thought, 'Wow, this is really remarkable stuff compared to new-construction.' It's a three-story Victorian, with a big wraparound porch. It looks like Grandma's house. It was a substantial middle-class house when it was built in the 1880s.
What was the house and neighborhood like back then? There were a lot of scary things that occurred on a regular basis. It was a garbage house; it was completely wrecked, but it had some potential. There were 13 rental units in the house. Across the street was a halfway house and kitty-corner was another. Next door was a drug den. Once I moved in and started renovating, I got very active with historic preservation.
What's the neighborhood like today? It's 100 percent changed. It's a very nice place now. It's more of a traditional neighborhood that used to exist where you can walk to the stores. It has a lot of character; it's clean, safe. I like it and have no plans to move.

Another Present from Uncle Sam?!

Great News Out of Washington for Homebuyers

If lawmakers get their way, Private Mortgage Insurance (PMI) will become tax-deductible for home loans originated after January 1, 2007. PMI is a requirement for most home loans in which borrowers make a down payment of less than 20%.
The bill has already been passed by Congress and awaits the President's signature before it becomes law.
While the new deduction is restricted to homebuyers whose annual household income does not exceed $100,000, the legislation could impact nearly 50% of all homebuyers, according to a SMR Research study of homes financed in 2005.
Up until now, many homebuyers have used "piggyback" loans in order to avoid paying PMI. A piggyback loan is where the homebuyer obtains two mortgages, a first mortgage for 80% of the purchase price, and a second mortgage for the remaining funds required, outside of the down payment.

Since many homebuyers have chosen a Home Equity Line of Credit (HELOC) as their second mortgage, their required monthly payments have increased significantly as a result of the actions of the Federal Reserve. Today, many homebuyers with a HELOC are now paying more than they would have if they had chosen PMI with their original mortgage.
What does this legislation mean to you?

Under the law, homebuyers will have more financing options available that offer greater tax deductibility and lower monthly payments. This means a homebuyer could potentially afford a more expensive home! In addition, homebuyers could qualify for traditional mortgages rather than the more expensive options they were forced to pursue in the past.

Contact me immediately to determine how you can put this information to use, and get off to a great start in 2007!

Home for the Holidays!

FHA brings the holidays home with a special homes sales event

To help increase homeownership opportunities during this holiday season, the U.S. Department of Housing and Urban Development is launching its special "FHA Brings the Holidays Home" sales campaign. This campaign is especially designed for low- to moderate-income families that may believe homeownership is out of their reach, by offering special incentives on the sale of HUD-owned single-family properties across the country.
During the sales event, homebuyers who purchase a HUD-owned home and finance the purchase with an FHA-insured loan will be entitled to valuable sales incentives including:
$2,500 holiday home improvement allowance $500 selling broker bonus Minimum required downpayment of only $100 The incentives are effective for HUD homes sold between Friday, December 8, 2006 and Friday, January 5, 2007 to homebuyers who intend to occupy the property as their primary residence for at least 12 months and who do not currently have an FHA-insured mortgage.
full story
Source: U.S. Department of Housing and Urban Development

Sold Property Data Available on EdinaRealty.com

Edina Realty delivers what consumers want!

RMLS has made information available on properties that have sold within the past two years, and Edina Realty is among the first companies to provide this data to the public. Sold Data Search - Click here to view
Consumers can find limited information about sold listings; enough to satisfy curiosity and see the historical trends, but then directing them to your professional real estate marketing expertise if they are considering entering the market as a buyer and/or seller.
Consumers can search by:
A specific address
A specific City or community
Interactive Virtual Earth™ Map
City and Map searches can be narrowed using optional search criteria for price, year built, number of bedrooms bathrooms, or the property type. When the search is performed, the results appear in a single line display. Click any address and the single line will expand to display a photo and basic property details.
Sold Data Displayed:
Sold price
Bedrooms and baths
Address
Date of sale
Property type
Property style
Garage stalls
School district
Lot size
Parcel ID number
Accurate & Up To Date Data
Edina Realty offers consumers 24 months of ACCURATE transaction history updated daily from RMLS, versus other sites like Zillow.com that have data pulled from Public Records, which can be several months old.
The question is not if consumers will be able to view information on sold properties, but WHERE they will view it. It is paramount that the consumer recognizes that the best, most reliable source for real estate information and services are knowledgeable Real Estate experts - Edina Realty agents!

Put a NEW HOME under the tree this year!

Best time to wrap up home shopping

The holiday season is a great time to be a buyer: There are fewer other buyers looking, and only motivated sellers have their home on the market.
Between Thanksgiving and New Year's Day, even through Super Bowl Sunday in many communities, few people think of buying a house or condominium. However, if you can drag yourself away from holiday festivities, it's the best time of the year to be a home buyer.
There are two reasons: Only serious, motivated sellers have their houses and condominiums listed for sale during this slowest time of year, and competition from other prospective home buyers is at its lowest, so your purchase offer will be extremely welcome and seriously considered.
And there's yet another reason why the end of 2006 is an especially good time to be a home buyer. In most cities, it's a buyer's market, meaning there are more homes listed than there are qualified buyers, so sellers (and their listing agents) are extremely anxious.
Shop for a mortgage first
However, before rushing out to buy a house or condo, smart buyers first get approved in writing for a home mortgage. This is a slow time of year for mortgage lenders, so they welcome loan applications.
Although mortgage brokers can arrange mortgage pre-approvals, the letter or certificate must come from an actual lender, such as a bank or mortgage banker. Most home mortgage pre-approvals are valid for 60 to 90 days.
Don't even consider a mortgage "pre-qualification," which means only, "We looked at your loan application and you appear to qualify but we haven't actually verified your credit and income." In other words, a mortgage pre-qualification is worthless.
However, home buyers should understand that a lender's mortgage pre-approval is subject to the lender's appraisal of the home you decide to buy, and reverification of your credit and income. So don't apply for additional credit or go out and buy a new car before you complete your home purchase.
Work with buyer's agent
After getting a written mortgage pre-approval from a lender, the next step is to work with an experienced buyer's agent who understands the market in question.
Ask friends, relatives and business associates for recommendations of buyer's agents. Although any licensed agent can be your buyer's agent, many agents prefer to list homes for sale rather than working with home buyers, who can be "time wasters."
A buyer's agent costs nothing extra. The listing agent of the house or condo you purchase will split the sales commission with your buyer's agent. Only in the rare event you buy a "for sale by owner" home and the seller refuses to compensate your buyer's agent would you owe any sales commission.
Comparative market analysis
When you find the house or the condo you want to buy, before making a purchase offer ask your buyer's agent to prepare a written CMA (comparative market analysis). This analysis is the same form the listing agent prepared for the seller when the house or condo was listed for sale.
However, your analysis will be up to date, whereas the seller's market analysis might be several months old. The analysis shows recent sale prices of comparable nearby residences (never older than six months), current asking prices of similar neighborhood homes and asking prices of recently expired comparable listings (usually overpriced).
As a savvy home buyer, you probably will have inspected many of the homes on the analysis. With the help of your buyer's agent, you can use the CMA information to arrive at a fair purchase-price offer.
Many buyer's agents recommend making a purchase offer based on a per-square-foot basis. For example, if nearby homes of comparable quality construction recently sold for $150 per square foot, you might want to make your purchase offer based on $150 per square foot.
Be sure to attach a reasonable good-faith deposit check to your purchase offer. If you are making an offer far under the seller's asking price, a substantial deposit accompanying it will often assure the seller that you are a serious buyer.
You can be sure your buyer's agent will use the CMA prepared for your use to show the home seller and the listing agent that your purchase offer is reasonable.
However, if the seller doesn't accept your purchase offer, a luxury of buying during this slow season is that there are few other home buyers in the market. You usually needn't be in a rush to respond to a counteroffer or make a new purchase offer.
Waiting a few days to respond, presuming you still want to buy the residence, will often make the seller think, "That was a pretty good offer. Maybe I should have accepted it."
Keep your offer simple
As experienced buyer's agents will tell you, it's best to keep your purchase offer as simple as possible. "A confused mind usually says no" is a very true motto. So include only a few contingency clauses in your purchase offer. Typical contingencies are:
1. Lender's appraisal contingency. Presuming you need a mortgage to finance your purchase, be sure to include a lender's appraisal contingency clause in the purchase offer. If the home doesn't appraise for at least the amount of your purchase offer as accepted by the seller, then you don't have to complete the purchase and can get your good-faith deposit fully refunded.
2. Professional home inspection contingency. Smart buyers make purchase offers contingent on their approval of a professional home inspector's report to be obtained by the buyer after the seller accepts the purchase offer.
The cost is usually around $300. Buyers should always accompany the inspector for the two- to three-hour inspection, because it is a good way to become familiar with the home and to discuss any unexpected material defects that are discovered.
A good approach for home inspection is to hire a member of the American Society of Home Inspectors (ASHI). To find local ASHI inspectors, go to www.ashi.org or phone 1-800-743-2744.
If the professional inspection report reveals serious undisclosed home defects, as the buyer you can cancel the purchase and obtain refund of your good-faith deposit, reopen negotiations with the seller to obtain a repair credit, or if the seller refuses to renegotiate, go ahead with the purchase anyway (presuming you want the home to that extent).
3. Sale of your current home contingency. During the past few years of a seller's market in most cities, this contingency fell out of favor with sellers and agents. But amid a buyer's market, many sellers will accept a purchase offer contingent on the buyer's sale of their current home.
However, to be fair to the seller, most sellers will insist on keeping their homes listed on the market while the buyer tries to sell his/her current home. In addition, most realty agents suggest a 48-hour or 72-hour contingency-release clause. That means if another buyer produces an offer acceptable to the seller, the first buyer then has 48 or 72 hours to remove his/her contingency clause for sale of their current residence.

THREE THINGS TO CONSIDER WHEN REMODELING

With Winter upon us it is a good for many of us to start thinking of some home remodeling plans. Here's some tips:

Home improvement shows may show a complete makeover in a matter of days. It is simple, cheap and it's a super way to have the latest look for your home. Not so fast!!

There are three things to consider. The first is the amount of time it takes for an actual makeover. True updates, especially in a kitchen or bath will take you and me a lot longer - even with professional help. The TV shows are using a team of experts and everything has been set up in advance, so they have all the materials, supplies and tools on hand. If you take into consideration all the pre-planning, that time table will be extended considerably.
Secondly, budgets may not be realistic. Do the math. They may have shoppers looking for down-and-dirty deals. They may also have access to items such as ceramic tile or appliances at a cost much less than the average shopper can pick up. If you've ever been involved in remodeling, you know it's going to cost more than your estimate. That's why contractors usually bid high or give you a range of costs.

Another thing to think about is the quality of the purchase. Buying cheap isn't always the best choice.

Now, let's talk about that third item, getting an up-to-the-minute look in your home. Major remodels can cost thousands of dollars. If you want the most value for those dollars, be careful about being too trendy. Whether you are staying in your home forever or selling it in 7 or 10 years, it will be a detriment to have your home scream 2006! Buyers often have a hard time seeing past the dated look. So, even if you choose quality fixtures and finishes, they will only see the amount of work involved to bring your home up to current standards.

For the best results, work with a designer, architect or space planner. They will have the resources and ideas to assist you in making the best decision for how you live now and in the future. Of course, if you want my advice, I'd love to come over and let you know how your remodel might possitively (or negatively!) effect your re-sale value.

The Best Time to Buy is NOW!

All signs point to NOW being the best time to make your move.

All indications are that the local market is PICKING UP.

Be prepared for a slew of articles next month discussing the rebounding market in the Twin Cities!

Check out the article...HERE!

Texas Realtor Offers Guns to Homebuyers!

Where's Charlton Heston when you need him?


Real estate agent gives guns to homebuyers

HOUSTON (Reuters) - A Texas real estate agent looking to add more bang to her business is offering clients in law enforcement a free Glock pistol if they buy a home from her.
Julie Upton, a Houston-area real estate agent, spurned traditional buyer incentives like free gasoline cards or home improvement store gift certificates.
Instead, she placed an advertisement offering a pistol with the purchase of any home worth at least $150,000 in the city police department's monthly publication, "Badge & Gun."
The free guns are only for those in law enforcement, said Upton, who is married to a police officer.
"We thought it would be a good way to entice other police officers," Upton said. "And whether people want the gun or not, it has stirred up a lot of attention."
Upton has given away two pistols to police officers who purchased homes from her. The guns cost about $500.
And so far the advertisement has not generated negative attention from the anti-gun lobby, she said.
In Texas, no license is required to own a rifle, shotgun or handgun, but a permit is needed to carry a concealed weapon, according to the National Rifle Association.

Real Estate Reads

Ok...so maybe READING about Real Estate may not exactly qualify as "entertaining"...nonetheless the StarTribune reported on some decent options if you are interested.

Real Estate Reads

Jim Buchta - StarTribune
Looking for a last-minute holiday gift? Here's a sampling of the latesthousing-related books about buying, bubbles and building.
By the end of the year, my desk is piled high with press releases, newspaper clippings and books. Lots of books; too many to ignore for another year. So, dear reader, as I go in search of my desk top, I do so with you in mind. Here's what I found.
"Closing Costs," by Seth Margolis, is a novel that chronicles the wackiness of the high-buck Manhattan real estate market through the experiences of a group of New Yorkers whose lives intersect in interesting ways. It's a fun-to-read, engaging look at how the other half lives, and buys and sells. It's written by a well-known mystery writer, who was inspired by his own forays into the market. ($24.95, 320 pages, St. Martin's Press.)
Speaking of engaging reads (I know, this isn't going to help those of you who are still trying to understand the difference between a conforming and non-conforming mortgage -- we'll get to that later), don't miss "The Tao Gals' Guide to Real Estate."
The subtitle of this book is "Six Modern Women Discover the Ancient Art of Finding, Owning, and Making a Home," and as you might expect it's the story of how a group of women use the Tao Te Ching as a guide to the practical aspects of buying a home (and their love lives, too, but that's another section of the paper).
Part how-to manual, part spiritual guide, this is a must-read for any woman who has ever considered buying a house. This one barely missed my list last year -- it was published in early January -- but it's too good to forget. ($14.95, 304 pages, Bloomsbury).
On to the nuts and bolts. With more people looking to retire the rake and shovel, townhouses and condos are a major force in today's market. If you're thinking about jumping on the maintenance-free bandwagon, I recommend "Everything You Need To Know Before Buying a Co-Op, Condo or Townhouse" ($18.95, 245 pages, AMACOM Press) by Ken Roth.
Written in mostly plain-speak by a real estate lawyer, this book highlights some of the joys and perils you might face in a community association.
At least once a day, sometimes twice, someone asks: "Bubble or no bubble?" Can't find my crystal ball, but Blanche Evans, editor of Realty Times, an online real estate website, takes a stab. She offers "Bubbles, Booms and Busts," an A-to-Z primer on how real estate markets work and how to proceed as a buyer or seller in these changing times. ($16.95, 196 pages, McGraw Hill)
Evans (let's call her Busy Blanche) also wrote the "Guide to Home Selling" and the "Guide to Home Buying." Buyers and sellers need all the help they can get right now. Both are published by the National Association of Realtors.
Don't fret, I didn't forget about those of you who plan to build, or simply have a high interest in new home design and construction. Taunton Press, publisher of Fine Homebuilding Magazine, offers several new titles you might want to consider. "The House You Build -- Making Real-World Choices to Get the Home You Want" ($34.95, 202 pages), by architect Duo Dickinson, is a very nice-to-look-at book aimed at helping readers navigate the home-building process. It focuses on 20 projects built during the past decade and includes details about budgeting, site development and design fees.
And "The Face of Home," by architect Jeremiah Eck, is another Taunton standout that you won't want to miss. This is the book that will help you decode the details that make you love or hate a building, and will help you understand the hallmark of good design. ($40, 217 pages.)
Speaking of Fine Homebuilding, the magazine celebrated its 25th anniversary this year, and to mark the occasion the company published "The Best of Fine Homebuilding: 25 Years of Great Building Tips" ($8.95), as well as a compilation DVD called "The Best of Fine Homebuilding" ($125). These are gifts that will appeal to those who know -- and care -- about the difference between a mortise and a tenon.
OK, so those are the highlights from my desk-top dig. But I was curious about what real estate titles were popular outside of the Star Tribune. I checked Amazon.com, which recently listed as its No. 1 best-selling real estate book "The Insider Secrets of the World's Most Successful Real Estate Investors" by Mark Evans ($16.95, 288 pages, BookSurge Publishing). That's as good an indication as any that even though the market isn't what it was last year, investors haven't given up on it.
Happy reading, and happy holidays.

Weekly Twin Cities Real Estate Market Activity Report

Activity in the Twin Cities residential real estate market rebounded for the week ending December 2 following the annual Thanksgiving pause. New listings were 6 percent greater than the same week in 2005, the first year-to-year increase in weekly seller activity since August; however, pending sales were down by 15 percent relative to the same week last year.

Falling interest rates and seasonal price moderation have prompted the positive effect on affordability, and REALTORS® should emphasize this improved buying climate to consumers. Our market has bounced back near the affordability range that drove the boom market of the first half of this decade, which will motivate wise buyers to vacate their spectator seats to participate in a housing market that is in their favor.

Are prices hot, or not so hot? It depends

The third-quarter house price index shows prices are up, down or steady, depending on where you live.

Is real estate heating up, cooling down, headed for a deeper freeze, or just hanging in there despite the challenges?
Pick your theory, as the latest federal report on home real estate price appreciation offers support for each scenario. The third-quarter "house price index" compiled by the Office of Federal Housing Enterprise Oversight examined changes underway in 275 of the largest U.S. markets.
Unlike other studies, the index survey tracks actual value shifts in millions of existing houses whose mortgages are owned or included in securities guaranteed by Fannie Mae or Freddie Mac.
Now to the four scenarios: Yes, real estate is heating up. You have to be in the right markets, of course, but there are several dozen hot spots spread nationwide. Take Bend, Ore., where house values appreciated at a stunning 30.7 percent during the 12 months ending Oct. 1, according to the survey. No dramatic bust or correction going on there. Or Myrtle Beach, S.C. (21.7 percent), Salt Lake City (20.4 percent) or El Paso, Texas (18.6 percent).
Overall, 37 metro markets saw average home appreciation rates of at least 15 percent during the 12 months covered by the survey, and 16 states had average gains above 10 percent. If that's not hot, it's at least warm -- exceptionally for a post-boom correction cycle. All these local markets continue to defy the gloom and doom predictions of the real estate bears.
The fastest-appreciating states for home prices this past year? Idaho (average 17.5 percent gain), Utah (17.4 percent), Oregon (16.9 percent) and Arizona (16.4 percent).
Everybody knows about the second scenario: Yes, real estate is cooling down. The third-quarter index documented that conclusively. The average appreciation rate for houses nationwide dropped to 0.86 percent during the quarter, or just 3.4 percent annualized. That's chillier than it has been since mid-1998. In five states -- Michigan, New York, Rhode Island, New Hampshire and Massachusetts -- the quarterly rate actually went slightly negative. It's unusual for an entire state to show net price depreciation for a quarter, but houses in economically hard-pressed Michigan slipped below zero for the entire 12 months of the study, depreciating by an average of 0.06 percent.
The deeper-freeze scenario? There's less hard evidence in the latest federal statistics, but some sobering trends appear in two categories of real estate markets: First are those areas where the regional economy has been struggling, where corporate layoffs and plant closings have pushed unemployment higher, and where there is little in the way of immediate relief in sight.
Examples include large swaths of the industrial Midwest -- Canton, Cleveland and Akron, Ohio, for instance, and Detroit -- each of which saw quarterly net depreciation slightly below 1 percent. Other areas fared even worse, such as Lima, Ohio, where the average house lost 3 percent of its market value during the quarter. Burlington, N.C., took the heaviest quarterly hit in the country -- 3.4 percent depreciation, an annualized 13.6 percent.
In the second category are the boom-era shooting stars where excess appreciation has burned itself out and prices are now flat at best: Half of all California markets saw quarterly declines in market values in the latest survey. San Diego and San Francisco both registered 0.2 percent depreciation for the quarter or nearly 1 percent on an annualized basis; Santa Rosa and Santa Barbara, Calif., and Sarasota, Fla., (all down 1.2 percent for the quarter, nearly 5 percent annualized); New York's Long Island counties of Nassau and Suffolk (0.7 declines), Boston (down 0.4 percent), and Barnstable, Mass. (2.1 percent decline).
Without question the most impressively documented scenario is that many large metro markets -- including some that experienced high gains during the boom years -- are still hanging in there and registering net appreciation, albeit at lower rates.
Examples include Fort Lauderdale (10.3 percent annualized quarterly gain), Naples, Fla. (10.8 percent), Los Angeles (7.4 percent), metropolitan Washington, D.C. (3 percent), New York City and its northern New Jersey suburbs (3 percent), Seattle (14.8 percent), Miami-Miami Beach (14.7 percent), Chicago (5.2 percent), Orlando (6.5 percent) and San Antonio (9.9 percent).
Twin Cities-area prices rose 0.06 for the quarter and 2.82 for the year.
The takeaway message from these seemingly contradictory patterns: Even in a general national cooling trend, the performances of individual local real estate markets are governed by the fundamentals of their own economies. There is no single scenario at work here.
But there is some positive news overall: In the words of Patrick Lawler, chief economist for the agency that produces the price index, "the transition from sizzling markets to normal or weak markets has been orderly so far, and recent drops in interest rates lessen the likelihood that precipitous changes will occur." (To see the full third-quarter house price index, go to www.ofheo.gov.)

Don't let the doom-sayers Scare you Away!

One rule of thumb when looking at how the Media covers Real Estate is to realize that typically they are 6 months LATE. Whether it's the booming of downtown condos or the recent adjustment in growth, the Media tends to sensationalize (fear sells!) and generalize.

Finally the word is starting to trickle out: Things aren't so bad after all!

Here's a recent article by Keith Harney - one of the Doomsayers himself- with a mea culpa about the current market:

Housing market looks more like a correction than a crash

Here are some other things to keep in mind when you take the long view of the Real Estate market:

• Home price declines are very rare. In fact, the national median home price has not declined since the Great Depression of the 1930s. Stock market collapses, OPEC oil crunch, economic recessions, and even wars have not negatively impacted national home prices since the 1930s. There have been few times when local prices declined. In nearly all these cases, the price declines were accompanied by sharp prolonged job losses. It is difficult to foresee a price decline in a job creating economy.
  
• Homes trade far less frequently than financial assets (about one home sale every 7 to 10 years for most homeowners). There are also larger transaction costs associated with selling a home due to the lengthy careful examination demanded by home buyers and sellers. Therefore, home prices are not prone to fluctuations as in the stock market. There are neither panic sells nor margin calls associated with homes.
  
• Many non-quantifiable factors could be important for this metro market in determining home prices. Access to cultural life, the quality of museums, nearby local and national parks, water views, exclusive neighborhoods, weather, the international airport, city vibrancy, restaurants, and a host of other non-quantifiable factors could have an important influence on the overall pricing.
  
• There are immense tax benefits to owning a home. These tax considerations were not considered in the analysis. For example, the 1997 law permitting primary owner occupants to trade down without having tax consequences. Also most home sales results in no capital gains tax. In addition, lengthier capital gains tax rates were reduced in 2003, thereby providing higher return for home investors. These positive benefits show an even stronger case for housing fundamentals in supporting home prices.
  

AFFORDABILITY

Another area we see the Media screaming about is affordability. Now this is an area that I believe deserves some scrutiny, especially when you consider that our Incomes have not gone up at the same steep rate (seemingly) of the local real estate market. It's easy to get caught up in hyperbole, so let's look at the facts.

Because home prices have risen faster than income, the ratio of price-to-income is currently above the historical norm. This measure is frequently cited to imply that there is a housing marketbubble.

However, mortgage rates declining to historic lows have been a major force in boosting home prices in recent years. Recent higher rates are still at historically favorable levels. Lower rates allow homebuyers to obtain a larger loan without necessarily increasing monthly mortgage payments.

A more relevant measure for assessing the risk of a home price bubble is the median mortgage servicing cost relative to the median income. This ratio is near the local historical average. It implies no widespread financial overstretching to purchase a home in the region.

Speaking of Fall:

l(a

le
af
fa
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one
l

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-- E. E. Cummings (1894-1962), American Poet

It Truly is a Buyer's Market!

Perhaps the worst kept secret in history - the current Real Estate Market clearly favors Buyers.

No doubt you have seen the headlines:

Buyer's Market? Existing-Home Prices, Sales Fall

Home prices keep tumbling

In a cooling housing market, buyers holding better cards

So is the sky falling? Is the bubble bursting?

Hardly. In fact, in most areas prices are continuing to go UP. Yep. The appreciation continues.

So why is this a Buyer's Market? Well, that's because rather than the steep climb in price we have seen over the past 10 years, prices are starting to moderate. This is a good thing for all involved because eventually it will provide more opportunity for EVERYONE!

As prices moderate -and yes in some cases even drop -it will allow more Buyers the opportunity to buy.


While Sellers will see less steep appreciation they will instead experience a more healthy -and sustainable- growth. And while they might not get top dollar when they sell the opportunity for them to get a killer deal when they buy will be there as well.

All markets are cyclical and Real Estate is no different. However, in the history of the United States only one commodity has continually and consistently gone up in value over time. Not stocks. Not gold. One thing: REAL ESTATE. It truly is still the best place to invest your money. The fact that you get to enjoy living in your nest-egg is just a bonus!

A lot of smart people are reaping the benefits of all of the current buying opportunities in the current market. Do yourself a favor - don't miss out!