Real Estate - Trends, News & Tips

Bank owned offers

2011-03-03T05:57:00.000-08:00

So you've decided to enter the 2011 market and are considering buying a bank owned property. You've heard there are 6 on every block and that the bank will thank you for taking it off their hands. Sounds great, right? Not so fast. Here are some tips to help you navigate purchasing a bank owned property.

Write your best offer. Banks are not in the business of giving away properties. Bank properties are typically priced aggressively and in our market are selling very quickly.
Read through the fine print. Many REO companies are requiring buyers to use the Banks pre-filled purchase agreements. Often times there are additional fees buyers need to pay.
Find out about delinquent taxes, delinquent water bills, and anything else that may come back to haunt you.
A deal is not a deal... until it is signed by the seller. Verbal offers back and forth mean nothing to banks. They are looking for highest and best.
Have an inspection. Often times we find mold, frozen / leaking pipes and clogged sewer lines among other issues.
Talk to the neighbors if possible. See if you can get the phone number for the previous homeowner.
Hire the best lender. Banks have penalties for not closing on time. Typically between $50-$100 per day.
Do your final walk through.
Earnest money is non-refundable. Don't expect to get it back after the inspection contingency is removed.
Expect delays on the sellers side. Give yourself some time after closing. Most banks will take up to 3 days to review the final settlement statement, which means you can't move in.
Buy a home warranty! There will be issues. Keep in mind most bank owned properties have been vacant for years, not months.

Good luck. Please don't hesitate to call or email me for more information. I'd love the opportunity to work with you. Naturally, I do all of this for my clients.

Thank you,
Craig

Progress is being made

2010-02-26T04:45:00.000-08:00

Great article released from the Minneapolis association of Realtors on the current housing market and where we are headed. http://mplsrealtor.com/downloads/inside/press-releases/news_2010-02.pdf

Prevent Foreclosure Now!

2010-02-18T04:49:00.000-08:00

There is an epidemic going on in this country and it concerns me a great deal. The epidemic is

called “Foreclosure” and it is happening all around us. It is fairly silent problem. The people

who need help aren’t asking for it. They are too embarrassed to talk about it so they don’t get

the help they desperately need. We are seeing people literally leave their homes in the middle

of the night so the neighbors don’t see what is going on. I need your help.

At Edina Realty we are becoming highly skilled working with banks to keep homeowner’s in their

homes or working out “short sales” so the damage to their credit is signiﬁcantly less than a

foreclosure.

I am asking you to become interested in the lives of those around you. I don’t want you to

become someone who prys into the personal lives of people who don’t want you involved.

However, it’s typically not hard to recognize when someone is having trouble ﬁnancially. When

you see that, be interested enough in helping them to have the courage to ask if they are in

trouble. Let them know there is help out there. The biggest problem to this epidemic is people

think they are alone. Let them know that there are 4.68 million homes that are projected to sell

this year. At the same time, there are 5.5 million homes that have mortgages that are in default.

This isn’t a small problem. It is an epidemic.

Did you know that someone who has gone through a foreclosure won’t be able to get another

mortgage for 5-7 years? Did you know that many employers will not hire people who have a

foreclosure that shows up on their credit report? Did you know that a foreclosure can damage

your credit score by 250-300 points and that will make it more difﬁcult and more expensive to

borrow money through any source?

There are options other than foreclosure. In 2009/10 the banks are realizing that it’s better for

them to work with homeowner’s rather than work against them. If things are handled properly,

it’s possible to get the banks to take a signiﬁcant loss and have only minor damage to your

credit. The main thing is to make sure they work with people who know what they are doing.

Please care enough about your friends, relatives and neighbors to encourage them to ask for

help if they need it. I am here to help. Please have them call me. I promise I will treat them

with respect. I will let them know they are not alone and I will ﬁght to help them. They just need

to know they are not alone and I will ﬁght to help them. They just need to know how important it

is to contact me early in their troubled times. Many times I am talking to people who are too far

along. At some point, it is actually cheaper for the bank to just foreclose. No one wants that

(not even the banks).

Announcing my move to Edina Realty.

2009-11-14T03:35:00.000-08:00

I am please to announce my affiliation with Edina Realty. My email address is craig@craigkanis.com and my phone numbers are as follows - c: 612-518-6221 and office: 952-898-1224.

Please drop a note or stop in. The location is Hwy 50 and 35 in Lakeville.

Thank you, Craig

Rates are down

2009-10-07T11:10:00.000-07:00

30 year conventional rates are down to 4.75% today.

Pending sales up, home prices down.

2009-08-12T13:54:00.000-07:00

Pending sales are up and home prices are down in the Twin Cities metro area, according to the latest numbers from the St. Paul Area Association of Realtors.

The association said Wednesday there were 5,174 pending sales in the 13-county area last month, a nearly 16 percent increase from the 4,462 pending sales reported in July 2008.

The number of closed home sales is also up for the year to date, to 24,533, 13 percent higher than the same period a year ago.

Prices, though, remain sharply lower than a year ago. The median sales price of a Twin Cities home in July, at $171,000, was down from $173,500 the previous month and nearly 18 percent lower than a year ago.

The numbers represent a continuing trend as more people take advantage of deals resulting from lender-mediated foreclosures and short sales — which both dampen prices and drive up the number of sales. Government efforts to stimulate the economy — from low interest rates to an $8,000 federal tax credit for first-time home buyers — are also helping boost sales.

Median Prices increase!

2009-07-20T08:48:00.000-07:00

This is an excerpt from the Minneapolis board of realtors.

Prices creep up as traditional sales grow
Minneapolis, Minnesota (July 10, 2009) – After increasing by $12,000 from April to May, the median sales price in
the Twin Cities housing market jumped another $8,500 in June as traditional homes—those excluding foreclosures
and short sales—again increased their market share, according to the Minneapolis Area Association of
REALTORS® (MAAR) based on data from the Regional Multiple Listing Service of Minnesota, Inc.

View the rest of the article.

Short Sales - The best option to avoid foreclosure

2009-07-17T19:20:00.000-07:00

Many homeowners are facing the idea of letting their home go to foreclosure. It is in the best interest of the lender and the seller to try and work out a lesser payoff 'aka' short sale on the property. This prevents the lender from having to take the property back that is stripped of copper, appliances, mechanicals... or just plain trashed. The key to negotiating a short sale is to start early, have a solid plan of action and be persistent. Short sales do take some time to complete, but you are much better off in the long run to try this process before the bank forecloses on the property. Please feel free to call me or email me if you or anyone you know is having to make this hard decision.

FIRST-TIME HOMEBUYER TAX CREDIT - Modified in American Recovery and Reinvestment Act - February 2009

2009-02-16T09:24:00.000-08:00

FIRST-TIME HOMEBUYER TAX CREDIT
As Modified in the American Recovery and Reinvestment Act
Major Modifications Italicized
February 2009
FEATURE

REVISED CREDIT –
EFFECTIVE FOR PURCHASES ON OR AFTER JANUARY 1, 2009 AND BEFORE DECEMBER 1, 2009
Amount of Credit

Maximum credit amount increased to $8000

Eligible Property
No change
All principal residences eligible.

Refundable
No change
Purchasers will continue to receive refund for unused amount when tax return is filed.

Income Limit
No change
Same income limits continue to apply.

First-time Homebuyer Only
No change
Still available for first-time purchasers only. Three-year rule continues to apply.

Revenue Bond Financing
Purchasers who utilize revenue bond financing can use credit.

Repayment
No repayment for purchases on or after January 1, 2009 and before December 1, 2009

Recapture
If home is sold within three years of purchase, entire amount of credit is recaptured on sale. Applies only to homes purchased in 2009.

Termination
December 1, 2009

Effective Date
All revisions are effective as of January 1, 2009

April 9, 2008 - January 1, 2009 - Frist Time Homebuyer Tax Credit White Paper

2009-02-16T09:03:00.000-08:00

TAX CREDIT AS CREATED JULY 2008
APPLIES TO ALL QUALIFIED PURCHASES ON OR AFTER APRIL 9, 2008 - January 1, 2009

Amount of Credit
Lesser of 10 percent of cost of home or $7500

Eligible Property
Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence.

Refundable
Yes. Reduces (or can eliminate) income tax liability for the year of purchase. Any unused amount of tax credit refunded to purchaser.

Income Limit
Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000).

First-time Homebuyer Only
Yes. Purchaser (and purchaser’s spouse) may not have owned a principal residence in 3 years previous to purchase.

Revenue Bond Financing
No credit allowed if home financed with state/local bond funding.

Repayment
Yes. Portion (6.67% of credit or $500) to be repaid each year for 15 years, starting with 2010 tax filing.

Recapture
If home sold before 15-year repayment period ends, then outstanding balance of repayment amount recaptured on sale.

Federal Government Stimulus

2009-02-13T20:07:00.000-08:00

The current bill in front of the US Senate sounds like it all but done. If passed tonight, it will include an $8,000 tax credit to first time homebuyers. The previous tax credit passed last year was $7500, but had to be repaid over a 15 year period. The new measure does not need to be repaid. There has never been a better time for a first time buyer to purchase a home. Interest rates are hovering around 5%, housing choices are plenty and the you get an $8k check from the government if you purchase before August 31st of 2009. Happy shopping... Christmas has come 10 months early this year!

Housing Market showing signs of stabilization

2009-02-13T19:58:00.000-08:00

For the week ending January 31, new listings continue at a lower level than seen last year, clocking in at 1,635—a 15.3 percent drop. Conversely, pending sales continue to raise and with 673 recorded for this week's report—25 percent above last year. Basically, this is all welcome news. Having fewer listings on the market, combined with an increase in pending sales, helps to reduce the Months Supply of Inventory to 13.5 percent when compared to lastyear at this time—down from 8.9 to 7.7 months. This means it will take the current supply of houses for sale 7.7 months to sell (on average). Prices will be the last piece of the puzzle to recover. Currently we are experiencing approximately a 60 percent foreclosure sales average. So nearly 2/3rds of all sales are lender mediated.

Weekly Market Activity Report

2009-01-15T12:33:00.000-08:00

As prepared by the Minneapolis Assocation of Realtors.

The New Year rang in with the normal post-holiday increase in new listings, but
listings are still down from the same week last year. Pending sales ( homes awaiting closing ) for the week
ending January 3 showed a strong increase during the year-end transition, rising
nearly 40 percent compared to last year. Over the last three months of the year,
pending sales were 18 percent higher than last year. Local housing inventory
has reached its annual low point but looks to rebound in the opening months of
2009.
This week's edition of the MAAR Weekly Market Activity Report features
updated figures from several important metrics:
In December, Days on Market Until Sale dropped 6.3 percent compared to last
year. The market appears to have reached a plateau in the amount of time
needed to sell a house, and this welcome decline certainly could continue into
the next year. Percent of Original List Price Received at Sale closed at 90.0 in
December, 1.3 percent lower than last year.
The new Housing Affordability Index (HAI) for January is extremely positive.
Last month we stated that the HAI of 180 was the highest we had ever
recorded. Now it's even higher, jumping an additional 12 points to 192. The rise
reflects the help that interest rates and softer prices have given to the market.
(Note: The decline in prices is driven by the significant amount of lendermediated
home sales and its benefit is not equal to all buyers.)

Feds to take over Fannie and Freddie

2008-09-11T12:06:00.000-07:00

Senior officials from the Bush administration and the Federal Reserve called in top executives of Fannie Mae and Freddie Mac, the mortgage finance giants, and told them on Friday that the government was preparing to place the two companies under federal control, officials and company executives briefed on the discussions said.

The plan, which would place the companies into a conservatorship, was outlined in separate meetings with the chief executives at the office of the companies' new regulator. The executives were told that, under the plan, they and their boards would be replaced and that shareholders would be virtually wiped out but that the companies would be able to continue functioning with the government generally standing behind their debt, people briefed on the discussions said.

It is not possible to calculate the cost of any government bailout, but the huge potential liabilities of the companies could cost taxpayers tens of billions of dollars and make any rescue among the largest in the nation's history.

2008-04-17T11:35:00.000-07:00

Spring inventory growth remains staid in the Twin Cities housing market as the annual influx of new properties for sale has not been as rambunctious as the levels seen over the last few springs. The total number of homes for sale in the metro area currently sits at 31,615 up only 3.0 percent from the same time last year -- the lowest such year over year increase for some years. Home sales remain relatively slow as well, with newly signed purchase agreements ( pending sales ) from the last three months trailing the same period last year by 16.6 percent.

A little real estate perspective

2008-02-15T09:13:00.000-08:00

This is from a couple of recent publications:

· While sales of existing homes are off from their high, 2007 was still the fifth best year on record for existing-home sales.
· We’re still within 2% of the all-time high median existing-home price set in 2006.
· There isn’t a single investment that doesn’t have a bad year. Accordingly, homebuyers in for the long haul always come out ahead in building wealth. The average return on a 5% down payment over 10 years is usually 3-5 times greater than stock market returns.
· Sellers controlled the market in the past, but this is now a great opportunity for buyers to negotiate. Buyers can find the property of their dreams now that they could not afford 4 years ago.
· Homes are more affordable than they have been in years. Home buyers who are willing to brave the harsh and cold meteorological landscape are finding the home buying environment quite warm and welcoming. The MAAR Housing Affordability Index (HAI), which measures how affordable Twin Cities housing is to its residents, jumped in February to 149—the highest level in nearly four years—thanks to continued declines in mortgage rates, a smorgasbord of homes to pick from and a seller psychology that is motivated to move and ready to negotiate.

New Construction Auction

2008-01-27T04:47:00.001-08:00

HOUSES ARE NOT SELLING FOR 50% OFF IN OUR AREA! Ok, now I feel better. The media is loving this coverage. First of all, there were only 200 properties on the auction of the more than 4,000 new homes currently on the market. Most of the properties were in smaller towns west and north of the cities. There were a few local properties, but all had reserves on them... So, even if you won the auction there is no guarantee that you could buy the home.

Clearly people can see through this. Only 150 people showed up to the auction. Please contact me if you have any questions or concerns about the value of your home. Don't let the media ruin your day.. remember, they are trying to sell airtime. Rates are low, houses that are priced right and staged well are selling.

Have a wonderful day.

Stimulus Plan - What's in it for housing

2008-01-25T06:52:00.000-08:00

If the House bills stays in tack as it moves to the Senate for passage, it will allow more subprime mortgage holders to refinance into federally insured loans by raising the limit on Federal Housing Administration loans from $362,000 to as high as $729,750 in expensive areas. Increase the availability of mortgages by providing a one-year boost to the cap on loans that Fannie Mae and Freddie Mac can buy, from $417,000 up to $729,750 in high-cost markets. Our market appears that it would see an increase up to $625,000 for conforming ( non-jumbo ) loans. Conforming loan rates are usually about 1% point less than jumbo loans... This would difinitely be a great boost for the real estate market above $450,000.

Have a great weekend.

CK

Fed Lowers short term rates

2008-01-22T09:18:00.000-08:00

The Fed Reserve Board lowered the target federal funds rate, or the interest banks charge one another for overnight loans, to 3.50 percent and the discount rate, the interest the Fed charges banks directly, to 4 percent. This doesn't normally have a short term affect on mortgage rates, but rates on 30 year mortgages did drop a little to around 5.375.

Short Term Pain, Long Term Gain

2008-01-09T06:25:00.001-08:00

I found this to be an excellent article on the Twin Cities housing outlook. Have a great day.

http://www.mplsrealtor.com/Segments/Realtors/housingmarket07.pdf

8 Strategies for sellers in 2008

2008-01-08T07:18:00.000-08:00

Here are eight strategies for buyers and sellers who want to make a housing move in ‘08:
1. Understand what “market value” means. It’s not what your friend sold his house for two years ago or even two months ago. It’s not the value your latest tax assessment was based on or what an appraiser said the house was worth a year ago. It is exactly what someone is willing to pay for your house today. Hence, price realistically and broaden incentives, such as closing costs and throw-ins like appliances, flat-screen televisions, etc. There is an old saying: “There’s nothing wrong with a home that the right price can’t fix.”
2. Don’t be an as-is seller. That is, unless you absolutely have to be one. Potential home buyers aren’t looking for fixer-uppers in the current market unless they are rock-bottom, bargain-basement priced. Large volumes of foreclosed homes are already being sold in poor condition at auction.
3. Hire a top performer. These days, you need an agent who outshines the others and routinely posts better-than-average sales numbers year after year. Agencies may try to steer you toward less-seasoned agents, but if you’re paying the commission, then the hire should be your call. The best agents have an innate sense for that right price and right marketing plan. They can suggest the necessary repairs and tweaks while targeting your home to the right buying group.
4. Know your market’s nuances. No two markets are exactly alike. Yes, most sellers are now swimming upstream. But there are always counter currents to consider. In many areas, modestly priced homes have bigger buying pools because tighter mortgage qualifications are keeping buyers out of more expensive homes. A little research and a savvy agent can give you an edge and an education.
5. Use the Internet. According to compete.com, total time spent online rose 24.3% from the fall of 2006 to the fall of 2007. Yes, people are still scoping out newspaper classified ads and real estate listing magazines, but more and more Americans have been wired to at least start their home shopping online.
6. Use other people’s money. You don’t have to sell for a big loss to get out from under your rising mortgage payments. If you can, rent out your home for a sum that covers your house payments, insurance, taxes and maintenance costs. Do try to roll in a slight buffer to cover unanticipated expenses. And realize you’ll need capital to refresh the place when the market stabilizes and you take off your landlord hat to prep the home for sale again. Or consider offering lease-to-own terms to your renter and you may not have to worry about the future sale.
7. Become a “lender.” Tough times call for unconventional measures. Consider carrying part of the buyer’s note with interest, secured by an asset belonging to the buyer. Do so only after a thorough credit check and only if you can afford to wait for the balance of the purchase price. This, by the way, is not a game for the faint of heart.
8. Simplify and neutralize. In this sales environment, you’ve probably already been told to focus on curb appeal, add fresh landscaping and de-clutter the house by removing family photos and heirlooms or other items you don’t need or use on a daily basis.
But let’s take it a step further. Paint your rooms neutral colors. Hire a redesign or home-staging firm to help you present your home in optimal condition and give potential buyers a chance to envision their possibilities there. And while you’re at it, get a pre-listing inspection, which will reveal any defects your home has and allow you time to make repairs. Then provide a copy of the report to buyers, attaching a list of the fixes you made.

8 Smart Moves for Home Buyers

2008-01-07T09:38:00.000-08:00

Buyers are in an enviable position, with plenty of homes on the market, and sellers who are willing to bargain. Here are eight tips for buyers.
1. Negotiate, negotiate. There’s a glut of homes on the market — more than twice the average inventory in some markets. Yet there are fewer prospective buyers with whom to compete, and considerably more room for after-the-purchase value appreciation than a few years ago. Sellers are fixing up their places like never before in hopes one serious buyer will come along. Your chance to pick up a quality home for a big discount may never be better than the present. Keep those counter-offers coming. And let the seller pay all the commissions! Remember, virtually everything in a real estate transaction is negotiable.
2. Think local. I’ve said it before: All real estate is local. Employ the standard strategy of examining recent sales prices of local comparable, or “comp” houses. But take it a step further. Ask your agent for the original listing prices of comp houses and compare them to the actual sales prices. Many Internet sites also have this information. This data will give you the clearest picture of what sellers were willing to accept for their homes in your neighborhood and can help you determine just how low you can go on your offer.
3. Don’t bank on further market drops. If you have the means, pounce on that oh-so-sweet deal. This cycle appears to be at or near the bottom. You can’t confidently count on the market sinking any lower, even though it may.
4. Keep resale potential in mind. Sure, you always seek out properties with that at-home feel. But if you can find homey in or near a growing medical district, growing university or other vibrant employment center, your resale universe down the road will always be larger than the market average.
5. Look beyond cosmetics. A tired-looking house in a great area may be a much better bargain in the overall scheme of things than a sprightly, higher-priced home in the same area. Yet many of these slightly worn homes, lest they be on the foreclosure auction block, are getting roundly ignored. There are some diamonds in the rough out there now!
6. Consider off-peak sales seasons. Yeah, there’ll still be bargains aplenty come the prime spring and summer selling season and plenty of inventory to peruse. But fall and winter can be the time of especially acute seller discontent. Sellers may be more motivated to take your lowball offer then — especially if it’s the only one they get!
7. Use your buying leverage. Ask the seller’s agent when the seller bought the home, how much he paid for it, and why he’s selling. In a seller’s market, the seller would likely thumb his nose at you upon such a request. Now, they may give it a thumbs up instead.
8. Ask for contingencies. When you’ve agreed on a sales price, make your offer contingent on the home appraising at that sum, on passing the buyer’s inspection and on you obtaining financing. Work in as much legal wiggle-room as you can so you’ll be able to back out without risking your earnest money should things go sour or another opportunity arise.

Housing Supply Outlook

2007-11-06T07:08:00.000-08:00

New construction listing inventory continues to drop as builders cut back on new projects and focus on selling existing units. The number of new construction units on the market has fallen by 17.5 percent when compared to this time last year and are being sold at 7.4 percent less per square foot.

Condominiums face a tough road ahead. Their sales have dropped the most of any property type, keeping their supply levels high despite a drop off in new listings.

The middle-upper price ranges found between $250,000 and $500,000 are more stable than others, seeing far less growth in inventory than other price ranges and a relatively smaller drop in buyer demand.

Massive inventory growth is taking place in the lowest price ranges, possible due to the role of sub prime foreclosure.

Foreclosures seem to be peaking in the state of Minnesota as the 2 year arms originated in 2005 are adjusting at this point causing a severe spike in payments for those folks.

Inventory is up slightly...

2007-02-05T08:37:00.000-08:00

to end up at 20,009 active listings in the 7 county metro area this week - that's less than I thought it would be. That is a 1.0% increase. The inventory is still growing at a slower pace than last year so that's good news too!!!!!

New pendings were up nicely at 24.1% over lat week and that is a 14.3% increase over the same time last year. The total number of new pendings for the 7 day period ending on Wednesday the 31st was 737 that compares to 594 for the week before.

Market activity

2007-01-24T08:49:00.000-08:00

The Twin Cities Realtors Association said there is some evidence that the local market is on an upswing. January has been especially good for market activity.The average sale price of a home in the Twin Cities in December was about $286,000, according to the Twin Cities Association of Realtors.That's up 2.2 percent over the previous December.

2007-01-10T12:14:00.000-08:00

Existing-home sales for 2006 are expected to come in at 6.50 million, the third highest on record, with a total of 6.42 million seen in 2007. New-home sales in 2006 should tally 1.06 million, the fourth highest on record, with 957,000 projected this year. This backs up the National Association of Realtors theory of a soft landing for the real estate market.

2007-01-10T09:35:00.000-08:00

The real estate market has really started to heat up this week. Inventory continues to drop, interest rates remain low and the spring market is right around the corner.