Modern Design in the Mountains - Featured Home Article

As a successful real estate broker in Aspen, Colorado, Scott Davidson had seen hundreds of homes in the mountain city to know what he did and didn’t like. So when he came across a circa-1960 home on a duplex lot, his initial thought was to tear down the home, build another, and sell it for profit. After all, the ranch, which is situated on the west side of town, was dated, having been remodeled several times over the past four-plus decades. But there was still something about the home Davidson couldn’t shake. “There’s something really charming about a mid-century house,” he says. “I just couldn’t tear it down.”

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F is for Photo - Melting Snow

Spring is coming to Minnesota.

Are Your Real Estate Photos Killing the Sale of Your Luxury Home?

It continually amazes me how home owners don't realize the poor quality of photos that their real estate agent is using to market their Million dollar homes here in the Twin Cities. Just today, I have been going through luxury homes stretching from Stillwater to Lake Minnetonka, and probably 90% of the homes priced over $800,000 have agent taken photos that are out of focus, tilted, angled, poor lighting....you name it, these photos stink!

In case you wonder if they really make that big of a difference, well I have to tell you that they do. If a buyer is looking at purchasing a luxury home, they want to see the home showcased at its finest. This means that quality photos must be taken by a professional photographer, and edited in the best way to show the homes highlights. Hey, I consider myself a decent photographer, but I leave the high-tech photo business to the professionals when it comes to my luxury listings. This means I spend money to get the quality I expect and the quality my clients deserve.

After all, what are they paying me for? My job is to market their luxury home to a luxury audience. Agents that bring their point-and-shoot cameras into a million dollar home should be kicked out on the spot. They don't know what they are doing, and the people who will suffer for it are their clients.

Want to know why your home has been languishing on the market for over a year? Over two years? Take a look at the photo below. It represents the only photo for a $1.5 Million listing in Minnetonka. The description in MLS sounds great, but there are no photos to back it up. Do you think a buyer would really want to set up an appointment for this type of listing?

Or how about this home below that started out at $2.4 Million in Eden Prairie? It is has been on the market for a while, and now is reduced $500,000. Could it be that the really poor photos, and there are more, are killing any potential sale for this home? I certainly think so.

As a home owner looking to sell, you really need to question the agent you use and how they are going to professionally market your luxury home. Luxury home specialists know that money has to be spent on quality photography and marketing pieces to attract buyers. Ask your agent for marketing examples and past experience in the luxury home market before you sign a year long listing because if you don't, the quality you could be getting could resemble the photos above.

Current Interest Rates Update

CURRENT INTEREST RATES AND CORRESPONDING ANNUAL PERCENTAGE RATES (APR) for the week of 03/01/2010 - Presented by Lisa Wells

CONVENTIONAL LOANS:
30 year fixed-5.00%-5.25%....APR Range-5.254%-5.587%
15 year fixed-4.25%-4.5%....APR Range-4.378%-4.685%
5 year ARM-3.875%-4.125%......APR Range-3.362%-3.720% (May increase after consummation)

FHA LOANS:
30 year fixed-4.750%-5.000%...APR Range-5.462%-5.605%
5 year ARM-3.75%-4.0%......APR Range-3.395%-3.625% (May increase after consummation)

JUMBO LOANS - loans $417,001 and higher
30 year fixed-6.5%-6.75%....APR Range-6.647%-7.188%
5 year ARM-5.250%-5.500%......APR Range-4.784%-5.159% (May increase after consummation)

-Adjustable rate loans and rates are subject to change during the loan term. The change can increase or decrease your monthly payment.
-Additional loan products, rates and lock periods are available.

MARKET:
Mortgage rates are enjoying a nice rally to start the week. When there is uncertainty in the market and concern about foreign governments- the mortgage bonds are the safe spot -this will drive rates down. Lots of economic data coming out this week with potentially the biggest market mover being the unemployment numbers on Friday. The expectation is that 20,000 jobs will be lost and the unemployment number will tick up to 9.8%. If the numbers show more jobs being lost- this will help interest rates move lower- if less jobs are lost- rates will move higher.

The tax credit for first time buyers and move up buyers is coming to an end April 30th. There will not be an extension on this either- simply can't afford it. Must have a fully executed purchase agreement by April 30th and must close by June 30.

Minneapolis Pond Hockey - Only in Minnesota

The US Pond Hockey Championships on Lake Nokomis in Minneapolis presented some good videos as well as an article written by an ESPN reporter. Only in Minnesota will guys bear the weather to play on a sheet of lake ice. Happily, I can say I have become a fan of hockey. I thought just marrying into a hockey family would be enough. Little did I know that I would have to move to Minnesota to truly appreciate the game.

New Construction Homes in Farmington Minnesota

If you are currently looking for affordable new construction South of the River then look no further than Farmington, Minnesota. For the fantastice price of $269,900, buyers can receive almost 3000 square feet of living space, including 640 SF of finished basement. Now is great time to take advantage of the remaining few months of the First Time Buyers Tax Credit, so give me a call if you have any questions or would like to learn more about these two new construction homes.

Heading in the Right Direction? Recent Market Stats Might Say So.

Got Boat? Need Slip?

I know it might be a little hard to be thinking of cruising around Lake Minnetonka with the rays of summer beating down on you, what with all this snow and freezing rain falling down on us. But if you haven't had to sell your boat due to the economy, and are looking for a place to keep that boat for all those summer escapes on the Lake, then you might want to take a look into Gray's Bay Marina and the boat slip lottery they are holding on February 17, 2009. Only one slip is available so get your name in to see if you can win it!

Visit the City of Minnetonka website for more info.

HUD Changes Some Rules to Help the Sale of Homes

HUD TAKES ACTION TO SPEED RESALE OF FORECLOSED PROPERTIES TO NEW OWNERS

Measure to help bring stability to home values and accelerate sale of vacant properties

WASHINGTON - In an effort to stabilize home values and improve conditions in communities where foreclosure activity is high, HUD Secretary Shaun Donovan today announced a temporary policy that will expand access to FHA mortgage insurance and allow for the quick resale of foreclosed properties. The announcement is part of the Obama administration commitment to addressing foreclosure. Just yesterday, Secretary Donovan announced $2 billion in Neighborhood Stabilization Program grants to local communities and nonprofit housing developers to combat the effects of vacant and abandoned homes.

"As a result of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers," said Donovan. "FHA has an unprecedented opportunity to fulfill its mission by helping many homebuyers find affordable housing while contributing to neighborhood stabilization."

With certain exceptions, FHA currently prohibits insuring a mortgage on a home owned by the seller for less than 90 days. This temporary waiver will give FHA borrowers access to a broader array of recently foreclosed properties.

"This change in policy is temporary and will have very strict conditions and guidelines to assure that predatory practices are not allowed," Donovan said.

In today's market, FHA research finds that acquiring, rehabilitating and the reselling these properties to prospective homeowners often takes less than 90 days. Prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition adversely impacts the willingness of sellers to allow contracts from potential FHA buyers because they must consider holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.

The policy change will permit buyers to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales. This will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities.

"FHA borrowers, because of the restrictions we are now lifting, have often been shut out from buying affordable properties," said FHA Commissioner David H. Stevens. "This action will enable our borrowers, especially first-time buyers, to take advantage of this opportunity."

The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner. To protect FHA borrowers against predatory practices of "flipping" where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions:

• All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.
• In cases in which the sales price of the property is 20 percent or more above the seller's acquisition cost, the waiver will only apply if the lender meets specific conditions.
• The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.

Specific conditions and other details of this new temporary policy are in the text of the waiver, available on HUD's website.

Banks Could be in Hot Water over Short Sale Fraud

I knew this article was coming out and was contacted by one of the parties mentioned in the story, but at the time had not had it happen to me in any of my short sale dealings. Shortly after the fact, I did have JP Morgan Chase ask me to keep something off the HUD involving a second lien holder in a short sale negotiation. Even after I notified them that what they were asking was a RESPA violation, they refused to yield. In the end, the home owner was able to pay off the second lien holder before anything further proceeded, but I wasnt' too happy with Chase's attitude that what they were requesting was OK.

Big Banks Accused of Short Sale Fraud

"Just as regulators, lawmakers and all forms of financial oversight boards are talking about new regulations to guard against mortgage fraud and another mortgage meltdown, there appears to be yet a new mortgage fraud out there today, allegedly perpetuated by agents of, yes, the big banks...." (read more)

Not All Negotiations are Nice

In Minnesota, the term "Minnesota Nice" is thrown around alot to describe just how great the people here are. But when it comes to negotiating deals in real estate, that nice attitude can sometimes be shed, especially when two parties have a hard time agreeing to terms.

Recently I had a transaction in which from the beginning, there was conflict. This happens sometimes when a buyer presents an extremely low offer which in turn greatly offends the seller. In this case, the seller stuck to his guns and refused to give into the buyer's demands. Frustrated, but really wanting the property, the buyer gave in and agreed to the sellers terms. From that point on, there was hostility from the buyer during the inspection period, during those negotiations, and up to the end. Of course, they pointed the finger at the seller saying he was being difficult, and the buyer's agent was wonderful to tell me what she really thought of my client.

But the point is this, not every deal is peaches and cream, and not every buyer or seller walks away from a sale feeling it was a win-win situation. Such is life. Negotiating a real estate sale can be down right unpleasant due to so many emotions getting in the way, however if you can keep the emotions out of it, you have a better chance of creating a pleasant atmosphere which will bring the "nice" back into the transaction.

Twin Cities Mortgage Update

by Lisa Wells

National Market News:

This week the Treasury will auction $84 Billion in new debt supply, starting today at 1pm, with $10 Billion in 10-Year TIP today. If the auction doesn't attract an appetite for the supply being offered, the Treasury would have to raise the yields on the Notes to attract buyers. And if that plays out, there would be some selling pressure on the entire Bond market, much like we saw a couple of weeks ago after poor auction results.

Also stirring the rumor mill is that St. Louis Fed President James "Raging" Bullard, stated at a conference in Shanghai, that the Fed should keep the Mortgage Backed Securities Purchase Program open beyond the end of March expiration. He went on to say that there is some interest in among other Fed Members to extend the program and that the Fed will be discussing the issue at a meeting later this month. It would be great to hear clear comments from Bernanke only because these statements appear to be the opposite of what the Fed had officially stated at each of the last two meetings-where they clearly stated the program would end. The worse case would be to have these rumors and headlines continue to confuse the market, build hope, but then have nothing materialize. This would cause a great deal of borrowers missing the great opportunity they CURRENTLY have.

CONVENTIONAL RATES:
30 year fixed-5.125%-5.375%....APR Range-5.254%-5.587%
15 year fixed-4.375%-4.625%....APR Range-4.503%-4.81%
5 year ARM-4.0%-4.25%%...APR Range-3.487%-3.845%

FHA Rates
30 year fixed-4.875%-5.125%...APR Range-5.587%-5.73%
5 year ARM-4.125%-4.375%..APR Range-3.77%-4.002%

JUMBO- loans $417,001 and higher
30 year fixed- 7.625%-7.875%.....APR Range-7.772%-8.313%
5 year ARM-5.375%-5.625% ..APR Range-4.909%-5.284%

If I had a Nickel...

Rare Coin Fetches High Price at Auction

Recently a 1913 nickel went up for auction in Florida and quickly turned a five-cent coin into $ 3.7 Million. The coin is unique as only five are known to exist and was minted at the Philadelphia Mint. It has quite a story as it used to belong to the Egyptian King Farouk who was disposed in 1952.

I honestly don't know if I could ever spend that kind of money on a five cent piece, but I guess if you have the money....

Is it Just Me or Are Things Getting Smaller

The last few months I have been noticing a trend in the products I purchase. It seems some things are getting smaller, but still costing the same.

Take for instance the Cascade bottle of dishwashing detergent I bought at Sam's Club. Normally a blob of thick white stuff comes out when it is time to run the dishwasher, but now it is more liquid than detergent, and runs like a river.

My sons love graham crackers as a snack. A few weeks ago I accidentally opened up the new box of crackers. To save space I decided to combine the two boxes. When I looked at the old crackers, and compared them to the new ones, you could see a definite difference. The new ones were still the same thickness, but the cracker itself was less wide. I don't recall a price reduction in the food isle at Target.

Last time we bought a bag of toilet paper, I combined the new ones with the remaining old rolls in our storage closet. It didn't take but a few seconds to notice the new rolls, while still having the same number of sheets, was about a quarter inch smaller in width.

So it appears that corporations have a need in this economy to lessen the amount of product consumers receive, but still charge the same price. I can completely understand where they are coming from...we all have to cut costs to make it through a downturn, but it would at least be nice if they were honest about it and told us up front.

What do you think? Have you noticed this trend in the products you buy?

Forever the Salesman

One great thing about being a Real Estate Agent is that the job takes you out of your element. You can't sit behind a cubicle or desk and only speak with a client on the phone. A good agent must get face to face with a client, sometimes many times, in order to build a relationship.

Sometimes I want to be a silent agent when I run errands or go shopping. But it never fails that I run into someone talking about real estate and I can't help but introduce myself. A good agent does this to build business. Our jobs are not Monday - Friday, 8-5. Many times we work all weekend and handing out business cards while standing in line for groceries is not unheard of. We can't sit at a desk and wait for the phone to ring. We have to find the business for ourselves and that is the main reason so many new agents fail. It is difficult to step out of your safe element and approach a complete stranger. You have to sell yourself. You have to be disciplined.

With so many people online now a days, I have to also communicate over the Internet. I do this through my website and my blogs. A couple of times people have called me for real estate advice. When I ask them how they found me, they say they have been reading my blogs the last few months and decided to finally speak to me. The Internet lets clients and consumers stay in their element, but I am still not allowed to do so. I must always be the salesman.