A Realtor's Point of View

Energy Efficient Upgrades

2008-08-22T07:10:00.003-06:00

Increase Your Home’s Value
through Energy Efficient Upgrades
www.homepages.com/debbiecassity

Increasing energy efficiency in the home is becoming more important for several reasons. It is, of course, a great way to reduce your monthly utility bills, but it’s also important because the world’s sources of energy are not infinite, and more people are recognizing this and looking at ways to make their homes more energy-efficient. Lastly, remodeling your home with energy efficiency in mind increases its value due to the resulting lower monthly utility costs.

Insulation
Good insulation is perhaps the most effective way of improving the energy efficiency of your home. However, some insulators are better than others. Fiberglass, once the most commonly-used insulator, is no longer as popular as it once was. Most fiberglass insulators are made using formaldehyde, and can release gas which decreases your air quality. Cellulose is a more efficient option; however some cellulose insulators may be treated with formaldehyde, so it pays to check before you buy. Superior cellulose insulators are treated with ammonium sulfate or borates, both of which are non-toxic. Cotton insulation has been increasing in popularity, due to its efficacy and the fact that it is environmentally-friendly. Cotton insulation is treated with boron, and is fire-retardant, pest-repellant, and completely non-toxic.

Windows and Doors
The average home loses up to 30% of its heat (or air-conditioning) energy through windows. Well-sealed windows and exterior doors are just as important as insulation for preventing energy loss. However, many frame materials require maintenance and choosing framing material that provides greater energy efficiency is often a trade-off in which more frequent maintenance is required. Wood frames are the most efficient in terms of energy loss and cause less condensation than other materials, however they will require painting or staining to keep them looking attractive. Aluminum frames, on the other hand, need very little maintenance but they are at the bottom of the list in terms of energy efficiency. Aluminum-clad windows are much more efficient. These are wood frames with an aluminum exterior, and combine the efficiency of wood with the low maintenance requirements of traditional aluminum frames.

Cooling
Many of the measures you take to prevent heat loss in your home will also help keep it cooler during warm weather. In addition, consider installing ceiling fans in your home. These are a more energy-efficient way of cooling than air-conditioners.

Efficient Lighting
When it comes to installing energy-efficient lighting, there are two main options – light dimmers and motion sensors. Light dimmers are switches which allow you to control the intensity of lighting in a room. Motion sensors turn lights on and off automatically by sensing when people enter and leave a room. These are particularly effective in rooms which are used irregularly, and in outdoor areas.

Outdoors
In the outdoors, trees and large shrubs are a less obvious way of making your home more energy efficient. With the additional advantage of adding appeal to your yard, careful planting of trees can add windbreaks which shield your house from wind, helping to prevent heat loss. Trees can also provide shade during the summer months, and help keep your home cool.

Using an Energy-Efficient Mortgage to Finance Remodeling
Major remodeling jobs that are planned with energy efficiency in mind can be expensive. This kind of remodeling will save you money in the long term, but the start-up costs are high. One way of financing such remodeling is with an Energy-efficient Mortgage. To qualify for an EEM, the money you save on your monthly utility bills must be greater than the monthly repayment of the EEM, and your total savings must also be more than your total costs (including maintenance). When you are granted an EEM, you have 90-180 days to carry out the remodeling work. Additionally, you cannot be granted an EEM if you apply after remodeling has started, or if you apply after any other financing has been granted.

10 Must-Do Repairs Before Selling!

2008-06-19T10:46:00.003-06:00

10 must-do repairs before selling

Tackling these basic, inexpensive improvements will help your home stand out from the crowd in a difficult market.

By Marilyn Lewis, MSN Real Estate

When you put a home up for sale these days, you're facing stiff competition. In most parts of the country, buyers are faced with huge numbers of homes for sale. Before asking strangers to trade hundreds of thousands of their hard-earned dollars for your little palace, make all the little repairs you've always meant to do but never had the time for.

These 10 basic repairs will help prepare your house for a buyer's white-glove inspection:

1. Repair sagging screen doors and other entry red flags.
The entrance to your home is the key to first impressions. Carolyn Brake, a home-staging expert in Aurora, Colo., near Denver, prepares about 10 to 12 homes a week for market and she stresses the importance of creating a great impression right off the bat. "We're not so much selling the house as we're selling the experience of living in this house," Brake says. Buyers will be alert to signs of neglect or deferred maintenance, since they want to avoid expensive hidden problems down the road.

Make sure everything at the entrance is in working order. If the screen door is sagging, you'll probably have to install a new one, as aging aluminum parts often become too bent or broken to repair, says Charlie Hudson, a remodeling professional and owner of Hudson Remodeling, in Lynden, Wash. But first, try replacing any missing or corroded hinge screws and tightening the rest.

Patrol the perimeter of your home, inspecting it with the critical eye of a stranger, advises Katherine Carroll, agent with Century 21 Mountain Lifestyles in Weaverville, N.C. Clear dead plants from flower beds, clip dead blossoms and stems, rake and haul the yard waste far away.

A fresh coast of paint on the front door goes miles toward establishing a great first impression. What color? Drive around for some inspiration and to see what colors prevail in your community. In some towns, a bright red door, or a deep plum, looks great. In others, it'll seem over the top. Forest green, navy blue and black can be great door colors. The front door need not match the exterior colors of your house and trim, only look good alongside them.

2. Spiff up the roof.

Missing shingles and hanging gutters broadcast a loud, scary signal to potential buyers. "You want the house to look as presentable and nonproblematic as possible," says Cathy Cowan, an agent with Windermere Real Estate Co. in Seattle. "There's a great deal of fear when people go out to look at property. You want them to be able to focus on 'Where does my bed go?' and 'Can we live here?' rather than, 'Oh my God, there's a problem with the roof.'"

Get a roofer to replace any missing or broken shingles or roofing tiles. Moss growing on the roof signals neglect, so it's important to get it cleaned off. Ask a roofing expert to remove moss or to recommend someone who can. Roofing professionals may suggest treating the surface of your roof with a chemical to kill moss or they may recommend installing zinc strips on the roof ridge. Water running over the zinc washes minute amounts of zinc carbonate over the roof, killing algae and moss, according to Z-Stop, which manufactures the strips. When hiring someone to work on your roof, it's crucial to check their recommendations. Amateurs can damage your roof with the careless use of a high-pressure power washer.

3. Clear and caulk gutters.

On a dry day, climb up on a ladder and clear all the debris out of the gutters so water can flow freely. While you're up there, recaulk the gutter end caps, advises Hudson. Seamless gutters are finished at the ends with a cap that's crimped and caulked. Aging caulk allows leaks to drain water down your home's siding.

Get started by drying the clean gutter; the drier the aluminum, the better caulk will bond to its surface, says Hudson. He recommends using flexible butyl caulk made for outdoor conditions. Its color doesn't matter, since you're caulking inside the gutter. Squeeze out a generous amount and use your finger to smear the stuff around inside the gutter cap seams. Don't worry about appearances, since no one will see your work.

4. Patch nail holes and repaint.
Moving inside the house, you'll want to patch up nail holes in the walls. Ask at a hardware store for lightweight putty. Apply it with a putty knife and fill in each hole, scraping the excess off the wall. Following directions on the package, wait for it to dry. Then sand the putty until it's smooth and flush with the wall. Paint the repaired spots with primer. Call a handyman for anything bigger than a nail hole, as it's not easy to blend bigger repairs into the wall and obvious patches telegraph the message, "I'm hiding something," says Hudson. Repaint the entire wall -- you're unlikely to be able to hide a touched-up patch, otherwise -- from one corner to the next.

5. Divorce your smoker and ship kitty to Siberia.
All right, just kidding. Sort of. The thing is, smells are a serious deal killer. When strangers enter a home, the first thing they notice is the smell. Don't even try hiding behind scented candles, potpourri and plug-in room fragrances. Buyers, ever suspicious to problems, catch a whiff of those and conclude that you're hiding something.

In the kitchen and bathrooms, deep clean with bleach, then regrout tiles and recaulk cracks between sinks, tubs, toilets, counters and floors to seal out the moisture that encourages the growth of smelly mold, mildew and bacteria.

If you've had smokers in the house, you've got extra work to do. To rid walls of smoke and nicotine film, some experts suggest washing the walls with cleaners using an alkaline builder, such as ammonia, and a glycol solvent (found at paint stores). Brake recommends painting an undercoat of Kilz primer onto clean, dry walls to seal in nicotine smells. Finish the job with a fresh coat of paint and change the furnace filter to further freshen the air in the house.

Then, "send smokers down the street," says Brake. She's not kidding: Ban smoking, even in the garden, because the smell clings to porches, decks and clothing. Gardens lose their appeal when littered with cigarette butts. If possible, board your cat off-premises while you're showing your home; at minimum, clean the litter box daily.

6. Replace damaged vinyl flooring.
Inspect the vinyl flooring in your bathrooms. If it has discolored spots or is loose, moisture may be damaging the floor. You'll probably want a professional to lay the actual flooring, which could cost $400 or more. But you can save as much as half of the cost by preparing the floor yourself.

Remove the baseboards by pulling them away from the walls with a small pry bar. Next, pull up the flooring using a larger pry bar -- it will be glued and nailed or stapled. Also remove the next layer, called the underlayment, made of particleboard or layered plywood.

While your new floor is being installed, you can sand and repaint the baseboards so the whole job will look terrific when it's finished. Another good choice for flooring material is linoleum, a green product made from linseed oil, pine resin, sawdust and other natural binders. It can add 30% or 40% to the cost of a $400 job.

7. Reseal the toilet.
Not all flooring installers will remove and reinstall the toilet, something that must be done to replace the floor. Pulling the toilet yourself can save you money. With plumbers' fees running about $85 an hour (with a minimum hour and a half charge for a house call), you could save yourself $200 or more (for two trips) by pulling the toilet yourself.

Even if you aren't replacing flooring, the seals may need replacing. How to tell? If the toilet rocks when someone sits down, or if the floor at the base is moist or discolored, the seal could be broken. Corroded nuts that hold the toilet to the floor are another sign that the toilet needs to be reinstalled. Before you begin, shut off the water supply at the faucet behind the toilet. Flush the toilet, holding down the handle to drain as much water as possible. Use a wrench to unscrew the bolts holding the toilet to the floor.

Don't move the toilet alone. Get a friend to help, because toilets are heavy and cumbersome, and the tanks are easily cracked. Prepare a bed of old cushions or towels in the bathtub and set the toilet there gently so any drips drain into the tub. At a hardware store, find two wax toilet seals (also called gaskets, about $3 apiece). One seal is conformed to fit into the sewer pipe; the second is a plain wax circle that you'll stack directly on top of the first. (Also at the store, purchase two new bolts -- about $1.50 each.) Back home, remove the old gaskets. Fit the new shaped gasket into the mouth of the sewer pipe first; put the second seal directly over it so the toilet fits into the space with no gaps. Lower the toilet over the seals. Screw in the new bolts, tighten them, reconnect the water supply and caulk the base of the toilet.

8. Stop faucet drips.
A dripping faucet calls attention to itself, and it's not hard to fix. Shut off the water supply to the faucets by turning the valves under the sink to the right. Then, test the faucet to make sure you've shut the water off completely. While you're looking under the sink, check for moisture on the wall around the valves and on the floor of the sink cabinet. Also check the supply lines leading to the dishwasher and disposal. If those areas are wet, get a plumber.

If you've got a newer, rotating, single-arm faucet (through which both hot and cold water run), note the brand and purchase a faucet rebuild kit (roughly $50) at the hardware store. Inside the faucet arm is a metal ball on a stem that lets the handle swivel while allowing water to flow in any direction. The kit contains the six to 12 parts most likely to fail, including that metal ball, O rings, springs and gaskets. The idea is to replace them all rather than trying to diagnose the exact source of the problem. Dismantle the faucet, laying the parts out in order on a paper towel. Snap a photo or draw a sketch to help you with reassembly. Replace the old parts, put the faucet back together and turn the water back on.

For older faucets with independent hot and cold water faucets, shut off the water under the sink as before then dismantle each of the sink's faucets separately. Remove the washers (rings made of rubber, plastic or brass), put them in a plastic sandwich bag and bring them to the hardware store to find replacements. Reassemble the faucets and turn the water back on.

If this seems like more trouble than you're willing to tackle, call a plumber. With no complications, a plumber can install the new parts in an hour, though most will bill you for an hour and a half minimum.

9. Renew dinged baseboards.
Beat-up baseboards detract greatly from the appearance of your home, and they're easy to spiff up. "All those little things tend to stand out," says Carroll. First, clean them to remove scrapes and smudges left by clawing pets and toddlers on wheels. Brake says a Mr. Clean Magic Eraser sponge works great on painted surfaces. Fill in dents with spackle, sand the baseboards smooth and repaint them. If you've lost the name of the original paint color, chip off a coin-sized bit, slip it into an envelope and bring it to the paint store where you can have the color computer matched.

Use primer before painting. Don't just retouch small areas; paint the entire piece of baseboard, from one end to the other. Choose a washable eggshell finish. White is a great choice for making baseboards and trim look crisp and clean.

10. Repair cabinet scratches.
You can quickly improve the look of unpainted woodwork and worn cabinets with an application of products that even out the surface color. Brake covers scratches on woodwork and cabinets with Old English Scratch Cover or a Tibet Almond Stick, a tight roll of cotton saturated in chemicals that the manufacturer, Zenith Chemical Works, says is a 100-year-old family formula. (You can find these at hardware and home-improvement stores.)

The almond stick goes on clear but covers scratches. "It's amazing," Brake says. Zenith owner Kim MacInnes says the almond stick works best with shallow surface scratches on dark finishes. It doesn't work in every case, he says, and even a good result may fade with time and need to be reapplied periodically.

Old English makes separate formulations for light or dark wood. These are oily stains, so use them carefully. Try out any products first in a corner where results will not be noticed. Do not use the dark stain on light wood. Finally, polish wood cabinets to a glow with lemon oil.

Southeast MN Market Trends

2008-02-22T09:22:00.006-06:00

Looking for information on Southeast MN real estate market?

Click on the link below and check out the market trends over that last 10 years.

Southeast Minnesota Market Trends

Foreclosure Process in MN

2008-02-08T14:30:00.000-06:00

Foreclosures are on the rise, and each state's process is different.
Below is a link to the MN foreclosure process.

Minnesota Foreclosure Process

Real Estate & the Economy

2008-01-28T15:51:00.000-06:00

REALTORS® and the U.S. Congress are working together to create vibrant communities in which to live and work. Today’s housing market is more important than ever. The housing market is facing big challenges with soft sales activity, falling home prices and rising foreclosures. Nonetheless, the market can turn around with favorable public policies. The health and revival of the housing market are the key to the overall health of the U.S. economy. REALTORS® continue to promote the policies conducive to homeownership. Consider the facts:

Because the housing market is a vital contributor to economic activity, the current housing market contraction has negatively impacted the broader economy. Existing and new home sales fell 12.8% and 26.5%, respectively, in 2007 following sales declines in 2006. Jobs in the residential construction sector have fallen by 291,000 from peak conditions in 2005. As a result the U.S. economy expanded at a sub-par rate of only 2% in 2007. A further weakening in the housing market has the potential to tip the economy into a recession in 2008.
Despite the slowdown, the housing sector still contributed nearly $2.1 trillion to the national economy in 2007, accounting for 15 percent of overall economic activity. The construction of new homes, value-added contributions of REALTORS®, and mortgage banking activity all directly add to economic output, job creation, and income generation. In addition, commercial real estate, which expanded solidly in 2007, contributed an additional $483 billion to the nation’s economy.
The national median price fell 2% in 2007, its first nationwide decline since the Great Depression. All real estate is local and home prices in two-thirds of the country continued to show positive gains. Despite the decline in the national median home price, housing has provided significant wealth buildup for most U.S. families who have a long-term commitment to homeownership. A typical homeowner would have accumulated $52,600 in housing equity over the past five years. The aggregate housing valuation was $23.2 trillion as of the third quarter 2007. After subtracting the mortgage debt value, U.S. homeowners now have $10.6 trillion accumulated in their housing equity. Consequently, consumer spending has remained surprisingly resilient despite high oil prices and uneven consumer confidence.
The rising delinquency and foreclosure rates are raising concerns. The foreclosure rate on subprime loans with adjustable re-setting rates has been particularly troubling, more than doubling to 6.9% from just two years ago. Abusive lending problems have begun to surface as refinance opportunities dissipate in a stagnant home price environment. Problems can be mitigated by adopting sounder lending standards and raising the loan limit on GSE and FHA loans, which NAR favors. A boost to home sales lowers housing inventory, which in turn, helps strengthen home prices. Higher prices lessen the likelihood of a foreclosure.
Both conforming and government-backed FHA and VA mortgages are widely available at historically low interest rates. With the risky subprime lending out of the picture, FHA will become an ever more important factor in helping to revive the housing market. Measurable gains in FHA market share are anticipated in 2008.
Real estate clearly is America’s greatest tangible asset, touching millions of people in countless ways. Serving as the pillar of our nation’s economy, a recovery in the real estate market will be critical. And, as in the past, the economy will inevitably follow in the direction of the housing market.

Because all real estate is local, market conditions vary greatly by region. In Alabama, for example, home sales are 5% below a year ago. Construction jobs accounted for 5.7% of all jobs in the state and the 21% reduction in housing permits portends a fall in construction jobs in the upcoming months. The foreclosure rate on subprime mortgages with adjustable rates is high at 7.4%, representing an increase of 134% from just two years ago.

~National Association of Realtors, Jan 2008

Happy New Year 2008!!

2008-01-23T08:56:00.001-06:00

Local Rochester MN Market Statistics for 2007...

Currently there is 929 residential homes listed in the city of Rochester with an average list price of $237,370. In 2007, 2224 homes sold in the city of Rochester alone, with an average sale price of $195,750.

With all the gloom and doom surrounding the national real estate market, Rochester is in a good position. In 2007, sales were only down only 7% compared to 19% nationally. It is a prime time to get into that new home, with a large inventory of homes to choose from and interest rates still at all time lows, there are some great investment opportunities.

Every real estate market is different, to truly understand the current Rochester MN market and the investment potentials that are out there, contact your Realtor.

Have a wonderful, fun filled 2008! Happy House Hunting!!

Buyers Time to Shine!

2007-09-24T17:54:00.000-06:00

"Attention Home Buyers!!!" It is your time to shine!!

Many Homes on the Market + Motivated Sellers = Great Home Deals!!

Contact you local Realtor to get started with the process!!

Current Market:

Homes on Market: 1281

Average Market Time: 179 Days

Average List Price: $236,592

# of Homes Sold: (Last 6 months) 1325

September Market Update

2007-09-07T09:13:00.001-06:00

Now that schools is in session, summer has come to a close, many people begin to dread the winter months ahead. Especially for those thinking of buying a new home.

If you want to get into a new home before the snow flies, beginning the process today is a good idea...Contact your local Realtor to get started. Your Realtor is invaluable resource when purchasing a home, making the the process as smooth as possible.

Rochester MN Market Update

There are currenly 1211 homes on the market in the Rochester Area with an average list price of $236,148 with an average time on market of 167 days. In the last 6 months, 1335 homes sold with an average sale price of $199,341 with an average time on market of 106 days.

The market is currently leaning towards a buyer's market. With the number of homes on the market, buyers have choices. But, needless to say, Rochester is and will continue to be a healthy real estate marketplace.

Problem Houses?

2007-08-21T06:56:00.000-06:00

Don't buy a house with these problems
Robert J. Bruss

Recently I received a letter from a reader who asked if having a tall water tower about 1,000 feet from his house would hurt his home's market value. By coincidence, a few days later I saw an appraiser friend at the local post office so I confronted him with that question.

"It sure won't help a home's market value," was his reply. Then, being an experienced appraiser, he reminded me the water tower is ed "functional obsolescence." That means it is a material fact that is virtually impossible to eliminate but has a significant impact on market value.

Functional obsolescence factors, whether within the property or outside, should always be considered when buying a home. Sometimes they "kill the sale." But in other situations, the buyer doesn't care or even likes the problem, which other buyers loathe.

For example, years ago I owned a rental house where the backyard adjoined a school playground. Although the house was in excellent condition, when prospective tenants spotted the playground hidden behind bushes, they suddenly lost interest. I quickly learned to advertise that house as "Close to elementary school." Then I had no trouble renting to families with children.

Looking back, I now realize that house adjoining the noisy school playground was a "bad house." It had an incurable defect that most prospective buyers and tenants disliked, thus affecting its desirability and market value.

EVEN NEW HOUSES HAVE DEFECTS.

Fortunately, most on-site problems with new houses are correctable, such as paint scratches or doors that don't close right. Buyers of new houses should (a) understand the terms of the builder's warranty; (b) hire a professional inspector to thoroughly check the house before the sale closes; and (c) inspect the house with the builder (called checking a "punch list") so both parties are aware of problems needing correction under the builder's warranty. Realizing the importance of having satisfied customers, the best builders promptly take care of any defects reported by the buyers.

THE DUTY OF HOME SELLERS TO DISCLOSE DEFECTS.

Most states now have either statutes or precedent court decisions that require home sellers and their real estate agents to disclose, in writing, known defects with the residence. However, some sellers and realty agents have "selective memory," meaning they forget to reveal some defects, hoping the buyers won't discover them.

When a home buyer can prove the seller and/or realty agent knew or should have known about a home defect, the buyer's legal recourse is to either (a) seek rescission of the sale or (b) sue for monetary damages. However, the buyer's difficulty is proving the defect was known before the sale closed.

PROFESSIONAL HOME INSPECTORS AREN'T PERFECT.

In addition to obtaining a written home-defect disclosure report, even when a home is being purchased "as is" (meaning the seller won't pay for any repairs), smart buyers insist their purchase offer include a contingency clause for their approval of a professional home inspector's report.

When hiring a professional home inspector, be sure to inquire as to the inspector's experience. Personally, I prefer members of the American Society of Home Inspectors (ASHI) because of their high membership standards. Local ASHI members can be found at www.ashi.com or 1-800-743-2744.

Home buyers should always accompany their professional inspectors. In addition, the realty agents and the seller are welcome to attend, just in case an unexpected serious defect is discovered and needs to be discussed.

When a serious undisclosed defect is found by the inspector and the buyer still wants to buy the house, a smart buyer will use the inspector's report to (a) get the seller to pay for repairs; (b) reopen negotiations with the home seller to get a repair credit, or (c) go ahead with the purchase anyway, knowing of the defect, even if the seller won't offer any compensation.

DON'T BE FOOLED BY HOME-WARRANTY POLICIES.

Home sellers and their realty agents often buy, as a sales inducement, a one-year home-warranty policy. These policies pay for repairs to built-in appliances, plumbing, wiring, furnace, and the hot water heater. Often excluded, unless an extra premium is paid, from warranty coverage are the air conditioning, plumbing outside the home's perimeter, roof, foundation and structure.

Home buyers should be aware warranty companies charge about $50 per service call, even if the defective component isn't covered by the policy. A favorite ploy of many home-warranty companies, especially when the problem is very expensive to repair or replace, is to say the defect was a "pre-existing condition," which is not covered by the policy. The best place to resolve such conflicts is in the local Small Claims Court where the home buyer usually is favored by the judge.

THE "TOP 10" STEPS TO AVOID BUYING A "BAD HOUSE."

Although most professional home inspectors have these key factors on their checklists, savvy home buyers also should be on the lookout for these potential serious problems:

MOLD AND MOISTURE. Even the best homes, at one time or another, have mold or mildew. The cause is trapped moisture, usually due to poor ventilation. In excessive amounts, such as after a flood or water pipe break, it can ruin a home because mold can be extremely difficult or impossible to remove.

RADON. According to the Environmental Protection Agency, this naturally occurring, radioactive gas is created in soil and rock beneath 1 in 15 U.S. homes. Radon allegedly causes cancer in residents whose homes contain radon underneath.

ASBESTOS. Asbestos was routinely installed in millions of U.S. homes for fireproofing, insulation, roof shingles, and floor tile. In good condition, there is nothing harmful about asbestos. However, when it deteriorates and the particles become airborne, asbestos can cause fatal lung disease.

LEAD-BASED PAINT. Before 1978, lead-based paint was used in most homes. It can cause brain damage to young children who ingest it, usually from flaking paint chips. But it is not dangerous if the paint is in good condition.
Federal law requires sellers of homes built before 1978 to provide home buyers and tenants with (a) a federal booklet about lead-based paint dangers, and (b) a disclosure form if the seller or landlord had lead-based paint tests performed. If desired, home buyers have 10 days to have a lead-based paint inspection at the buyer's expense.

FORMALDEHYDE. Many manufactured homes contain this material which causes eye, nose, and throat irritation, as well as coughing, rashes, headaches and dizziness in some people.

CARBON MONOXIDE. Malfunctioning furnaces, wood stoves, kerosene heaters and lamps, fireplaces, water heaters, and gas stoves can produce invisible but deadly carbon monoxide in homes. The easy solution is to install a carbon monoxide detector, usually costing $25 to $40.

DEFECTIVE WELL WATER. If the home being purchased depends on well water, be sure to include a purchase-offer contingency clause for a test of the well-water quality. Also, have the well's pump tested to be certain it is in good working condition.

SEPTIC OR SEWER SYSTEM. A home that is not connected to a public sewer system probably has a septic system, which drains waste water into the soil. Be sure the septic system is located a substantial distance from any well. If the seller reports the home is connected to the public sewer, be sure to verify this and that the sewer pipe is not broken.

HIGH-VOLTAGE POWER LINES. Government tests have been inconclusive if adjacent high-voltage power lines cause cancer and other diseases. But they certainly don't benefit health. The presence of nearby high-voltage power lines won't enhance a home's market value and can be considered a serious negative factor at resale time.

OTHER NEGATIVE INFLUENCES. There are many possible negative influences, sometimes beyond the home's lot boundary, that can affect desirability. Examples include a high crime rate, heavy street traffic, poor location, poor-quality public schools, lack of public transportation, nearby noisy railroad tracks, poor floor plan, inadequate or dangerous wiring, galvanized pipes, an old furnace, leaky gutters, flood zone, high fire-hazard area, earthquake fault zone, seismic hazard zone, easements and encroachments and high property taxes.

SUMMARY: No house is perfect. To avoid buying a "bad house," smart home buyers ask lots of questions and insist on a professional home-inspection contingency clause.

Buyer's Market in Full Swing!

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

The Rochester market, as well as most of the nation, is in the middle of a buyer's market. This market is great if you are thinking of buying your first home as there are many great deals out there right now. Talk with your Realtor about what you are looking for in your new home and begin looking....you never know what you will find, it might just be your dream home at a price you can afford.

Below is an article to help first time homebuyers begin the process of purchasing that new home! And as always, talk with your Realtor, as they are the expert on the process! :)

First Time Home buyer Tips

If you're a first-time home buyer, you've probably discovered that you have a lot to learn - and unfortunately, it's all too easy to get burned. But don't be discouraged. By doing some research, you can avoid common first-time buyer mistakes.

Try to Refrain from Large Purchases

If possible, don't make any big purchases or take out loans that you can't pay off in full within six months. When you're calculating how much you can afford to spend on a home, your total monthly debt should not exceed 36% of your gross monthly income. If you owe any more than that, you could find it hard to get a loan. If you must have that new car, wait until closing is completed before you buy so that your purchase doesn't affect your mortgage eligibility.

Investigate "Hidden" Costs

Closing costs are normally 3-5% of the property's value. In addition, owning a home has associated costs - insurance, property taxes, and maintenance all add up. Plan to spend 1% of your property's value on annual repairs. Remember that moving into your first home probably means spending extra money on furnishings, too. Take all of these things into account when you're calculating how much you can afford to borrow, and how much you'll need to cover up-front costs.

Study the Market

When you've decided on the area you want to move to, do some research and get a Current Market Analysis (CMA). A CMA will calculate the market value for the type of home you're interested in on the basis of recent sale prices of similar properties and will help you determine if properties you're interested in are priced competitively.
In addition you need to decide if it's the right time for you to buy. If you have only a small amount of cash for a down-payment, if interest rates are high, or if property prices are predicted to drop in the near future, consider holding off for six months or a year, until the market is more favorable.

Shop Around for a Loan

In a hot market, sellers often only consider bids from buyers who have mortgage pre-approval. Don't use this as a reason to rush into getting a mortgage. Take the time to find a good deal, and carefully consider your options when it comes to interest rates and other terms. Take into account how long you intend to live in the property. If you plan to move out after a few years, an adjustable rate mortgage may work better for you.
Your lender is required to give you a Good Faith Estimate within three days of your loan application. This documents your closing costs and expenses related to inspections, taxes, title insurance and other essentials. Get a copy of the Good Faith Estimate before making a commitment so that you're aware of these costs up front.

Hire Independent Inspectors

When you find a property you like, the next step is hiring inspectors. This is usually optional, but it's still an important part of the process. Before you make this purchase, you need know all about the property - whether it's structurally sound, if the plumbing and wiring are in good condition, and if it has sustained any major pest damage. Your agent may provide you with a list of contacts or may offer to help handle it. However, it may be more prudent to hire independent inspectors. Using an agent's "buddies" sounds attractive because it's one less thing for you to do, but on the other hand the agent wants this deal to close so they can collect their commission, and they may not have your best interests in mind.

Don't Let Your Emotions Take Over

Buying a house can be stressful. Try to keep a cool head and be realistic. If small repairs are needed on a property that you really like, don't be discouraged if the seller refuses to take care of them. Instead, negotiate a lower sales price. Similarly, set a limit on what type of repairs you're willing to tackle yourself and then stick with that limit. If you don't want to cope with major structural repairs then avoid properties that need them, no matter how much you like it or how flexible the seller is willing to be on price.

Just as importantly, don't let anyone talk you into something you can't afford. Once you've made the decision on how much you want to borrow, don't change your mind, or you may end up in financial difficulty later on.

Thinking of Investing in Foreclosures?

2007-06-12T10:05:00.000-06:00

There has been so much talk about the increase in foreclosures in the news, the following is an article on some tips when thinking about purchasing a home that is in foreclosure. This information is good to know as this trend seems to be increasing as interest rates continue to increase.
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Investing in Foreclosures

A foreclosure occurs when a borrower defaults on a mortgage loan. As the process begins, the lender often gives the borrower ample time to repay the back due portion of the loan. However, when the borrower doesn't repay, the lender takes possession of the home. The borrower must then vacate it as they have given up all their interest in the property. Since foreclosures can often be purchased by another individual at a much lower price, investing in them can be very beneficial.

How Do You Find Foreclosures?

One method of finding foreclosures is to search for the lenders that hold the defaulted mortgages or lenders that have begun foreclosure proceedings. This can be accomplished by visiting the county recorder. These documents are part of the public record and you'll find that in most states, the recorded document will be a Notice of Default or a Lis Pendens. If the state is a non-judicial state, they will record the Notice of Default. Judicial states will use the Lis Pendens. Since the Lis Pendens is a court record, you'll instead search the records of the court.
Many county records have these available online. If they're not available, you'll need to go your county's recorder's office to do your search. While this may be a time- consuming job, investigating the lenders who've recently begun foreclosure proceedings or have recorded the defaulted mortgage is often a very profitable task. It's also the least expensive way to handle your investigation.

It's Wise to Have an Inspection Done

Although the lenders who hold the defaulted property will often discourage inspections, it's highly recommended that you investigate the condition of the property before purchasing. Many lenders won't accept any contingencies on a purchase and sale agreement for a foreclosed property. If this is the case on a foreclosed property you wish to purchase, try to have them allow you to do your inspections before you place an offer on the property. While you do run the risk of losing the property to another investor by taking the time to do your inspections, it will allow you to know whether it is a sound investment or not.

Avoid Properties with Structural Issues

Once you've found potential foreclosures, you'll want to figure out how these particular properties would be a good investment. If during your inspections you find structural repairs are needed, proceed with caution. Often, the cost of a structural rehab makes the property a non-profit investment for you. On the other hand, if the property simply needs cosmetic fixes, it will most likely be a wise investment.

Investing in foreclosures does take thorough research and some knowledge of the cost of rehabilitating a property. However, with this time and effort, you'll find the results to be worthwhile and profitable.
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If thinking about investing in any sort of real estate, it is always a good idea to contact a real estate professional, as they know the market and can give you some great advice or bird dog on your behalf to find the necessary information that is needed to get a good buy, cash flow information, or just help facilitate a smooth transaction.

Rochester Area Economic Development, Inc 1st Quarter 2007 Report

2007-05-21T15:23:00.000-06:00

1st Quarter 2007 Home Sales : MLS Home Sales

First quarter sales of single family homes reached $68,384,022.

This represents an increase of seven tenths of one percent over
first quarter 2006 and 2.1 percent over first quarter 2005.

The average home remains on the market in the Rochester area
for 128 days. Mortgage rates continue to remain relatively low.

Source: SE Minnesota Association of Realtors

1st Quarter, 2007 Rochester Area Building Activity

Commercial and residential building permits issued for first quarter
2007 totaled $89,036,726. This represents an increase of 38.8 percent
from first quarter 2006 ($64,132,284) and an increase of 28.6
percent over 2005 ($69,248,771).

Permits over $1 million for first quarter 2007 included Centex Homes (2 story/10 units), Mayo/Gonda Floors 14 & 15-Orthopedics, Mayo/Diagnostic Floor 16 Pediatric Remodel,
Mayo/Gonda Floor 19, Interior Fit-Up, Mayo/Gonda Floor 17-Sleep Center and Floor 18-Paluminary, Village on 3rd, Knutson Office Building, Kwik Trip Store, Mayo/Charlton Hyperbaric and Altitude Medicine, Wehrenberg Theatres (structural shell), and Maine Street Development (structural shell).

Source: Rochester Building Safety Department

Rochester Market Update

2007-05-04T15:39:00.000-06:00

The Rochester Real Estate Market is in full swing, buyers and sellers are reaping the benefits of current low interest rates (6% for a 30 year fixed) as well as the warm weather and sunshine!

Currently there are 1214 homes on the market in Rochester, with an average list price of $247,400 and an average time on market at 144 days. In April, 190 homes sold with an average sale price of $196,400 and 273 homes went pending and are waiting to close.

If you are a home seller or buyer, I am sure you are seeing this upswing in activiy, read below for some advice to get an edge on the competition....

Seller Advice:

If your home has been on the market for a few months or more, you may be starting to get a little worried. If you have this problem, it's important to identify the cause and take steps to fix it as soon as possible.

The most common problem is unrealistic pricing. Over-pricing by as little as 5% can reduce buyer interest very quickly, especially if you're not prepared to negotiate on the price. If, for example, your property is worth $250,000, and you list it at $265,000, your home will end up competing with properties that really are worth that figure, and right off the bat your chances of selling are reduced. And the longer your home is on the market, the higher the possibility that both buyers and agents will start to think that there are more serious reasons for why the property isn't selling. Luckily, over-pricing is the easiest problem to fix. Lower your price a little, and be prepared to negotiate for buyers with solid financial backing.

Buyer Advice:

*Should I use a real estate broker? How do I find one?

Using a real estate broker is a good idea. A real estate professional can guide you through all the details, including financial ones, of buying a home. A real estate broker will be well acquainted with all the important things you’ll want to know about a neighborhood. The agent will help you determine the price range you can afford and will search the classified ads and multiple listing services for homes in your price range. The broker also has immediate access to homes as soon as they’re put on the market, so your chances of locating what you want increase.

Once you want to make an offer, the broker can point out ways to structure your deal to save you money. The agent will explain the different types of mortgages, guide you through the paperwork, and answer last-minute questions when you sign the final papers.

You should be aware that unless you have specifically requested a Buyer’s Agent, the agent essentially represents the seller.
(*Information provided by GinnieMae.gov)

Question: What does it cost to use a Realtor to buy a home?

In most real estate transactions, the seller's (listing) agent pays the buyer agent's commission, buyer does not pay to use a Realtor to assist in buying a home.

This Week in Rochester Real Estate!

2007-03-23T08:04:00.000-06:00

With the snow melting and the weather getting warmer, the Rochester real estate market continues to steam ahead!

Currently there are 1202 homes on the market in Rochester with an average list price of $248,700 and an average time on market of 151 days. In the last 6 months there has been 813 homes sold with an average sale price of $192,300 and an average time on market of 124 days, with 248 homes that are waiting to close.

Buyers are in a good position at this time, with the number of homes on the market they have a choice of homes, but as Spring approaches there will be more buyers entering the market place and competition for homes will increase. In addition, interest rates are still below 6%, so it is a good time to reconnect with your lender!

Sellers have some competition out there, to catch a buyers eye, the home has to be priced right for the current market and in the best condition possible, all little repairs completed and super clean for showings. If this is not the case, you risk not being considered by a buyers as it will not compare to the competition.

I forsee it to be a very busy Springtime in Rochester for buyers and sellers, contact your Realtor today to get started on the process of making your transition.

Spring Market is Heating up!

2007-03-04T15:34:00.000-06:00

As of today, there are 1080 homes on the market with an average list price of $250,813 with an average time on market of 170 days.

Despite the wintery weather, the market is in full swing with many out of town buyers already purchasing homes and people transitioning within the city. Rochester usually sees a large increase in home sales during the Spring and Summer months with Medical & Technology professionals beginning new jobs and training at Rochester's largest employers, Mayo Clinic and IBM.

Interest rates continue to hover around 6%, still historically low, which makes it a great time to make that move.

If you are planning on making a move this Spring/Summer, now is the perfect time to contact your Realtor to get started on the process.