Property Flipping

Property flipping is a large problem in the real estate market. This happens when a person buys a home and puts it right back on the market anywhere from twice to ten times what he or she paid for it doing little to no rehabilitation on the home.  An article on nhi.org by Ada Focer stated that

“…the truth is that behind the paperwork of property flips are a lot of lies orchestrated to create an illusion that the properties are worth more than they are, or the buyers are financially stronger than they are, or both. When markets cannot differentiate between illusions of value and the real thing, everyone gets hurt – not just the buyer, but the whole neighborhood.”

The threat of flipping is very real and is all over the country. On February 18th, 2011, Robert W. Dufresne of Golden Valley, MN pleaded guilty to swindling investors out of more than five million dollars in a flipping scheme that spread out over multiple states. He faces up to 20 years in prison for the mail fraud charge.  The entire article can be found here:

http://tcbmag.blogs.com/daily_developments/2011/02/mn-man-pleads-guilty-in-5m-house-flipping-scheme.html

and here, along with various other MN scammers that have been caught recently:

http://www.flippingfrenzy.com/category/minnesota/

While many people see property flipping as deceitful and wrong, the truth is that while an seller may have hiked up a price and done the minimal rehabilitative projects that the house needed to get on the market again, no one is forcing these people to buy it. A woman in Baltimore purchased a home for $83,000 from a man who got it for $15,000 and when the city tore her neighbor’s house down, hers collapsed. While it may seem wrong to most people that this happened, the truth is that the man didn’t make her buy the house. She had the choice to have an inspection done and she chose not to. Unless he lied on the paperwork and marketed the house as something it wasn’t, the situation isn’t illegal.

Property flipping, when done with integrity, can be good for a neighborhood. It keeps the values of the surrounding houses up and the community healthy. It can also be a fun project for couples who don’t mind moving from place to place. When a legitimate investor hires contractors to fix up the home, he or she is giving jobs to the community. Most flipped houses are foreclosures and when they are purchased, it takes that burden off of the community and other house values instantly increase, and if you think about it, would you rather live next to some vacant house with a jungle yard, or a home that is cleaned and fixed up? (That is very much a rhetorical question, I know I would way rather live somewhere that I can charge people to go on a safari)

It seems that property flipping can be a pretty controversial topic in the real estate world, but when it is done well and with honesty, it has an overall positive effect on a community.

Articles on house flipping:

http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=2467

http://www.nhi.org/online/issues/113/focer.html

http://www.mkemortgage.net/content/house_flipping_434.htm

The Birthplace of Minnesota

Stillwater, founded in 1837, is known as the “birthplace of Minnesota” and is a town that has a unique mix of a bustling main street, filled with stores of all kinds, and a quiet surrounding scenery of bluffs, forest and the river. The streets of downtown are teaming with old fashioned candy shops, wineries, antique stores filled with treasures from the past, and one-of-a-kind eateries that are exclusive to the town. There are numerous bed and breakfasts tucked away in the quiet hills of the town, perfect for a low-cost romantic get-away.

As a one of the the biggest tourist attractions in the state, this little town sees people from all over the world year round. The locals embraces the traffic that the tourism brings, and the they offer many different options for a day of fun. There is everything from lunch on the river paddlewheel boats or 40’s style dining train to trolley tours of the town (say THAT five times fast) to hot air balloon and romantic gondola rides.  The places to eat range everywhere from old fashioned malt shops and burger joints, built for families and kids, to high-end restaurants where couples go to for a romantic evening bathed in candlelight.

For history buffs, there is no end to the places that one could visit. Many of the buildings and houses are from the original town. There is a historic courthouse that offers tours and a place for weddings, and multiple houses sprinkled throughout the town that were the homes of famous writers and celebrities. One could spend the day walking around, looking at the homes and guessing the history, but a more efficient way to get the information would be a trolley tour. They last about 45 minutes and cover as much of the town as possible.

Honestly, I could spend my entire day going on and on about this beautiful little haven tucked into the scenic St. Croix bluffs, but this is one time where curiosity getting the best of someone is going to lead them to find their own little piece of history.

Informational Websites:

http://www.ci.stillwater.mn.us/

http://www.onthelake.net/mn/stillwater/index.html

http://www.co.washington.mn.us/info_for_residents/parks_division/historic_courthouse/

http://www.ilovestillwater.com/

Curb Appeal

It is said that first impressions are made within the first 10 seconds of meeting someone. The same can be said for a house. If a buyer gets a bad first impression driving by a home and seeing the outside, chances are they won’t be interested in setting up a showing. A good landscape and overall outside appeal are critically  imperative to snag the interest of a potential buyer.

Now is the special time of year when those who are blessed with a green thumb break out their gloves and mini shovels and trek out to the backyard to dig holes that will be filled with bulbs and seeds. For those of us whose thumbs are only slightly tinted green (when held in just the right lighting), the pre-potted plants do the trick. Whoever came up with the idea to sell plants that are already started was just awesome, plain and simple. These lovely little beauties are already started and if you remember to water them, they are almost impossible to kill. It’s a win/win situation where both the gardener and the flowers are happy.

Plants and flowers are not only beautiful to look at, but they are said to produce about 30% of the Earth’s oxygen. They also help give a home one of the least expensive ways to get desired attention, and gives the seller the means to add just a little bit more on to the asking price. The biggest strategy for plants, flowers and trees in a yard: curb appeal.

There is a great video on curb appeal and the kind of investments that can be made to achieve it. The video can be found here:

http://simsburytv.org/video/4055820

Curb appeal isn’t just plants, however. There are many small changes that can be made to spruce up your house’s exterior. Try getting a new door, or shutters. Try painting your old door or even the whole house. Replace exterior knockers and door handles with something brass and fancy looking. Mailboxes, outside lights, and well placed stones can help do the trick. There are so many different ways to make a house look better and more pulled together and they don’t have to be done all at once. You can take your time and budget to do them little by little.

There are so many helpful articles out there, I have compiled a list of some that I found:

http://www.kiplinger.com/features/archives/2009/03/improve-your-curb-appeal.html

http://www.goodhousekeeping.com/home/renovation/boost-curb-appeal-mar02

http://landscaping.about.com/od/designexamples1/Landscape_Design_Ideas_The_Essentials_of_Curb_Appeal.htm

http://briankoester.com/2011/05/home-improvement-projects-that-increase-curb-appeal/

http://www.infotube.net/blog/2010/04/stepables-plants-for-pathways-boost-curb-appeal.html

Hopefully these have helped to give you some new ideas to freshen up the look of your house this spring!

Why It’s Better to Use a Realtor

There are times when ‘doing it yourself’ is good. Not everyone needs someone to mow their lawn or clean their house, but with huge financial investments such as buying or selling a home, it would seem that the obvious choice would be to use a professional. Realtor.com says it best when they state that

Real estate transactions involve one of the biggest financial investments most people experience in their lifetime. Transactions today usually exceed $100,000. If you had a $100,000 income tax problem, would you attempt to deal with it without the help of a CPA? If you had a $100,000 legal question, would you deal with it without the help of an attorney? Considering the small upside cost and the large downside risk, it would be foolish to consider a deal in real estate without the professional assistance of a Realtor.

It seems that using an agent would be the obvious choice, but there are people out there that would rather do it themselves than worry about having to pay a commission. This may seem like a good idea to some, but the fact is that people who want to do it themselves often have a harder time getting the price they want for their house. Agents are trained professionals that know how to negotiate a closing so everyone walks away from the table satisfied.

For those still skeptical, think of it this way, would you rather give a real estate agent the small percentage of the commission that averages a few hundred to a few thousand dollars and sleep well knowing that all the paperwork is tight and right, or save the commission and risk not only getting less money for your home than what it is worth (potentially losing much more than what you would have paid in a commission) but also not being sure if the paperwork is sound.

It seems like a good idea would to be to at least consult with an agent. When doing so, they may even be able to help you find a happy medium. This is a very flexible industry and most agents want to help.

Minnesota History

Today is Friday and that means time for some fun. I have compiled a list of a couple websites that give interesting facts about MN. Hopefully this will help us all brush up on our knowledge of the place we live and give us a new insight for this beautiful state.

We have well over 10,000 lakes, we boast the biggest mall in the US, we were the birth place celebrities ranging from Bob Dylan and Prince to Judy Garland, Winona Ryder and Vince Vaughn. We also have over 90,000 miles of shoreline, which is more than California, Florida and Hawaii combined (take THAT tropical paradise).

In 2010, CNNMoney ranked Eden Prairie, MN number one on a list of top 100 best places to live in the US. The reasoning behind this was the low unemployment rate, excellent, nationally ranked, schools, and beautiful rolling landscapes. The full article can be found here:

http://money.cnn.com/magazines/moneymag/bplive/2010/snapshots/PL2718116.html

We may not have the glitz of Hollywood, the magnetic pull of New York City or the bustling nightlife of Las Vegas, but here in the Twin Cities, the people are real, the air is clean, and the sun shines (most of the time), giving us amazing blue skies. I can’t speak for everyone, but it seems to me that this is a pretty nice place to live.

Lists of fun facts about our state:

http://www.50states.com/facts/minn.htm

http://www.cbsnews.com/stories/2008/08/30/politics/main4401216.shtml

For Sale By Owner

In today’s economy, most people are trying to save money. We have learned to work harder, spend more wisely, and invest in smarter opportunities. These values have carried over to our real estate market as well. For Sale By Owner (FSBO’s) made up almost 9% of the market in 2010. One website gave statistics on FSBO’s that stated:

 The typical FSBO home sold for $140,000 compared to $199,300 for agent-assisted home sales.

FSBO Methods Used to Market Home:

  • Listing on Internet . . . 27%
  • For-sale-by-owner Web site . . . 11%
  • Yard sign . . . 46%
  • Friends/neighbors . . . 39%
  • Newspaper ad . . . 12%
  • Open house . . . 14%

Most Difficult Tasks for FSBO Sellers:

  • Getting the right price . . . 23%
  • Preparing/fixing up home for sale: 18%
  • Selling within the planned length of time: 14%
  • Having enough time to devote to all aspects of the sale: 13%
  • Understanding and performing paperwork: 10%

The entire article can be found here:

While selling a home by yourself can save you money on a commission, it is much more difficult to get the best possible price for your property. Realtors have access to numerous networks of buyers and agents, as well as countless marketing tools. That is what they are paid to do. Agents are trained to negotiate with other buyers to get you the best deal possible and have everyone walk away from the closing table happy. While deciding if you want to use an professional may seem like a tough assessment to make, there are certain agents that give home owners a halfway point.

Team Boo is one of the few real estates groups that offers two packages for those wanting to sell their own homes, but also desire a licensed expert marketing their property within certain networks that only agents have access to. This kind of exposure can be exactly what a home owner needs to get their property to the right buyer who will offer the right amount for what the house is worth. The choice to work with an agent to sell your house is smart not only because of their extensive knowledge of the documentation and verbiage that will keep you safe legally, but also their intimate familiarity  of today’s market.

If you have any questions about the packages offered or the FSBO process in general, email info@teamboo.com or call Jim Boo at 651 231 3111 and you will be greeted by an informed agent with an answer to your questions.

Bring on the Sun

Today is Friday. Yes, the six letter magical word that gets children and adults alike, excited about the next two days. We have been conditioned to look forward to this day of the week since we were young, and now with the approaching warm weather, the weekend means bonfires, flip flops, fishing, barbecues, days at the lake and all around quality outdoor time in great weather.

In the land of 10,000 lakes, the Twin Cities boasts some of the most beautiful lakes and parks in the state. The Chain of Lakes is a part of the Grand Rounds in Minneapolis and has a 13.3 mile long trail around it the is excellent for biking, walking or jogging. The Grand Rounds itself is a system of trails, paths and roadways that come together to make a loop around the city approximately 50 miles long. This beautifully urban scenery is perfect for those who enjoy a long bike ride or walk. For those less ambitious folks, there are parts that are also made for vehicles.

The informational website for these places can be found here:

http://www.minneapolisparks.org/default.asp?PageID=71

With so many beautiful choices, who wouldn’t want to spend some time outdoors this summer?