Changes to the Real Estate Industry in August 2024: NAR Settlement Terms Explained

If you are in the market to buy or sell and have not yet heard about changes coming to the real estate industry later this summer, you will. Hopefully this post will get you started. 

Background

In March 2024, the National Association of Realtors (NAR) agreed to settlement terms• which will modify home buying and selling practices for many consumers across the county, including in Minnesota. This post summarizes two key terms from the settlement that will go into effect starting August 15th in the Twin Cities MLS region (no later than August 17th nationwide).

How have real estate agents typically gotten paid for their services?

sellers

Most sellers’ agents do commission-based work with the commission being a percentage of the final sale price. (Other models such as flat-rate exist but for the purpose of this post I’ll use the commission model.) The final payment for services happens at closing. Then, if sellers have agreed, their agent pays a portion of that commission to their buyer’s agent.

buyers

In Minnesota, buyers wishing to be represented sign a Buyer Representation Agreement with an agent detailing services and associated fees (we’ve been using buyer agreements since 1993.) Through the traditional model, most buyer’s agents receive payment for their services via the commission split described above, if the seller agrees. If a seller does not agree to pay the buyer’s agent fees, the buyer would pay the amount they negotiated with their agent in the Buyer Rep. Agreement.

The commission and offers of compensation to buyers’ agents have always been negotiable terms in Minnesota’s representation contracts, and still will be.

The amount a seller agrees to offer a buyer’s agent has historically been visible to other agents in our Multiple Listing Service (MLS). Starting August 15, 2024 it will no longer be.

Two Big Changes Affecting Buyers and Sellers

First Change: Offers of Compensation

“Compensation offers moved off MLS: NAR has agreed to put in place a new rule prohibiting offers of compensation on an MLS. Offers of compensation could continue to be an option consumers can pursue off-MLS through negotiation and consultation with real estate professionals. And sellers can offer buyer concessions on an MLS (for example—concessions for buyer closing costs). This change will go into effect August 17, 2024.” -NAR website

What does this mean?

Offers of compensation to buyers’ agents will still be allowed in Minnesota but they may no longer be advertised on the MLS or any MLS-related aggregator. Listing agents can, however, advertise them off-MLS via individual marketing materials — signs, flyers, individual websites, etc.

Concessions

Buyers have always been able to ask sellers for various types of concessions when making an offer. For example, a buyer might ask a seller for an allowance to buy new carpeting, pay part of their closing costs, or give credit for a new roof. Compensation to pay the buyer’s broker for real estate services may be presented as another type of concession in the offer.

Sellers have always been allowed to offer concessions as incentives to buyers, and still will be able to. The new rule specifically regulates visibility of any offer of compensation to a buyer’s agent for real estate services — it will be prohibited on the MLS. Concessions, such as those listed above, will still be allowed on the MLS.

This change will likely add an extra layer of negotiation, particularly around how agent compensation is handled. There may be bumps in the road but with clear communication and transparency, the process should smooth out to benefit both buyers and sellers.

Second Change: Buyer Representation Agreements

“Written agreements for MLS Participants acting for buyers: While NAR has been advocating for the use of written agreements for years, in this settlement we have agreed to require MLS Participants working with buyers to enter into written agreements with their buyers before touring a home. This change will go into effect August 17, 2024.” -NAR website

What does this mean?

If buyers wish to tour a home with an agent they must first enter into some type of written agreement. In Minnesota we’ve had Buyer Representation Agreements in use for decades. Requiring a signed agreement prior to touring a home, however, will be a new practice starting August 15. New types of touring agreements may come into play which could include various tour fees for buyers.

The new regulation applies to both in-person and virtual visits, but not to open houses. Home shoppers will not need a signed written agreement when visiting open houses or asking host agents about their services.

Differences Among States

NAR as a national trade group includes members from every state. Each state has varying practices and/or legislation that determine how its industry functions; some states may be more affected by the settlement changes, some less. 

Learn More

Real estate professionals in Minnesota have been busy working out a new normal and preparing for August 15th. Both the state and national associations of REALTORS® have published helpful resources for consumers wanting to understand more about the settlement and how changes may affect them. Click here to learn more from our state association or check out NAR’s resources for both buyers and sellers. As the changes get underway don’t hesitate to reach out. I’ll gladly talk through “what if” questions and clarify any new information as it becomes available.

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*The settlement is still subject to final court approval. A hearing on final approval of the settlement to be held in November 2024. 

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes to inform buyers and sellers on variety of topics including market conditions, tips for selling and buying, homeownership trends, and more. Reach her at heidi@lyndenrealty.com or 651-503-1540. 

Thriving in a Seller's Market: Tactical Tips for Homebuyers

The Twin Cities’ spring market is now tipped in favor of sellers. Appropriately priced, tuned-up properties in popular locations are moving quickly with buyers lining up to compete in multiples. If you are a home buyer navigating this fast-paced seller's market, you might feel overwhelmed. With limited inventory and fierce competition, it’s easy to find yourself engaged in bidding wars ending in heartbreak. This post is for you dear buyers — with strategies, flexibility, and professional guidance you can turn the odds in your favor and secure your just-right home. 

Tip #1: Get Your Finances in Order

Before you even start your home search, it's crucial to get pre-approved for a mortgage. This not only signals to sellers that you're a serious buyer but also gives you a clear understanding of your budget and what you can afford. It also strengthens your negotiating position and also allows you to act quickly when the perfect property comes along. Keep in mind, most sellers won’t even look at offers without a lender’s pre-approval.

If you are paying in all cash, be prepared to provide proof of funds in lieu of a pre-approval. A bank statement or letter from your banker showing the full amount should suffice. If not cleared state, I always check with the seller’s agent to confirm the preferred documentation.

Do know the seller’s agent may call your lender to verify your relationship and financial position. When representing sellers, I typically reach out to lenders for this confirmation before my clients sign anything. Assume the seller’s agent will do the same.

Tip #2: Work with an Experienced Real Estate Agent

Partnering with a seasoned real estate agent is crucial in the current seller’s market. Your agent should have insider knowledge of the local market, understanding of current trends for successful offers, and negotiation skills to help you secure the best deal. Lean on their expertise to navigate the competitive landscape and present an offer with winning price and terms. 

A knowledgeable agent will also have an in-depth knowledge of contracts to help you understand the plethora of paperwork needed for a successful transaction. I always recommend reading forms before signing anything, and ask your agent when in doubt. All questions are good ones! 

Tip #3: Be Prepared to Act Fast

In a competitive market, time is of the essence. Hesitation could cost you your dream home. When you find a property that checks all the boxes, don't wait – act swiftly and decisively. Schedule a showing as soon as possible (day one on market), and if you're truly interested, submit an offer soon after, if need be. When you’re ready to act, your agent should be connecting with that seller’s agent immediately to establish a relationship, learn seller preferences and gauge any competition. In a multiple offer situation, there will typically be an offer date/time deadline of which you'll need to be aware. Communication among agents is often the only way to learn how a seller plans to proceed. But be aware, ultimately it’s the sellers’ decision and they may be pleased enough with the first offer to just sign it and move on, forgoing the opportunity to generate multiples. Either way, be ready to act when you find “the one”. 

Tip #4: Make a Strong and Compelling Offer

When competing in a seller’s market, it's essential to come in strong. Work with your agent to establish a strong offer price using comparable homes and buyer trends. Then check in with your lender to stay within your budget and confirm what they can accomplish within the offer timeline. I typically loop in my clients’ lenders early on in the process to ensure clear and quick communication in the event we need to pivot or act quickly. Also consider including terms that are favorable to the seller, such as a quick close, appraisal gap coverage or inspection contingency waiver (if you're comfortable doing so). 

A Word on Love Letters to the Seller

Buyers often ask if they should write a letter to the seller when submitting an offer. Depending on the letter content, doing so could set the seller up for a potential fair housing violation. For example, sellers could unconsciously (or consciously) choose a buyer based on race, religion, familial status, etc. So, I recommend either avoiding the letter altogether, or including only what you love about the home — no personal information or photos. Occasionally when asked, or when stated in the agent’s notes, a seller may request that buyers omit love letters. Consult with your agent before spending time composing. 

Tip #5: Stay Flexible and Keep an Open Mind

Flexibility is key in a competitive market. Be prepared to compromise on certain preferences, such as style or amenities, in order to secure a home in your desired area, for example. Also, keep an open mind during your search – you may be surprised by properties that initially fall outside your criteria but end up being the perfect fit. Finally, be realistic about price. If you continue to lose out to offers well over list price and cannot afford to compete, consider searching for less expensive homes. Give yourself some wiggle room to offer more by bidding on homes that cost less. 

Thriving in a seller's market requires a combination of preparation, strategy, and flexibility. By getting your finances in order, working with a seasoned agent, acting swiftly, making strong offers, and staying flexible, you can increase your chances of securing the perfect property despite the competition.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes to inform buyers and sellers on variety of topics including market conditions, tips for selling and buying, homeownership trends, and more. Reach her at heidi@lyndenrealty.com or 651-503-1540. 

Open Houses 101 for Homebuyers

If you’re searching for a home, you’ve most likely checked out an open house or two. Along with private showings, open houses are a common way to get inside and can be an insightful next step after searching online. Here’s some food for thought for buyers venturing out on the weekends (or sometimes week nights), from an agent’s perspective. 

Why go?

I hold open houses often so I get to meet a variety of people. Though I sometimes meet passersby, most often I meet visitors who have already scoped out the property, poured over details and studied the photos. Though online pictures and virtual tours are helpful, there’s nothing like stepping into a home to test out other senses – How does it feel? Or smell?? Getting inside answers questions about space, scale and other unknowns like flow, basement storage, closet configuration, ceiling height, and more.

If you as a buyer are already working with a real estate agent, your agent may send you to an open house ahead of a private showing. If they’re out of town or tied up with other clients during your free time, why not stop in for a preliminary peek? In a seller’s market, waiting too long to see a property may cost you, so better to tour sooner than later.

If you’ve already had a first showing with your agent, sometimes an open house is a good opportunity for a second glance, or a chance to bring through family members, contractors, or even inspectors.

Getting a Feel for the Market

Going to open houses can also be a good opportunity to get a jump on the spring market. Start doing your research and taking notes to get ahead of the game. I often meet prospective homebuyers who are planning to buy in the spring but are getting a feel for the market starting late fall.

Condo or Single-family?

If you are not sure what type of property you want to buy, open houses create an opportunity for checking out a variety of home types and/or developments. For example, you may be debating condo life but have never actually been in one. Or you may want to compare amenities in a small association versus a larger high rise. Or you might visit and compare different townhouse developments. Talking to a variety of agents about these Common Interest Communities (CICs) can be insightful — How are they managed? What’s included in the monthly HOA fee? (More questions to ask when buying a condo or townhouse here.)

Finding a Realtor

If you aren’t currently under contract with a buyer’s agent, open houses can be one way to meet your future agent. Chatting with agents at open houses gives you a good sense of their market knowledge, years of experience, personality, and compatibility in general. Reading online reviews, websites and blog posts are some ways to research, but there’s nothing like meeting face-to-face to get a vibe. Don’t be afraid to chat and ask questions! 

The Seller’s Agent

Keep in mind that the agent hosting the open house will be representing the seller, not you, and will have the seller’s best interest in mind. Sometimes the listing agent will host, other times another agent from their brokerage (or another brokerage) will. Either way, the seller will be represented. Be aware of agent/client relationships and what you reveal to the seller’s side about your price, terms and motivation. If you are also represented (under contract) I recommend letting the seller’s agent know right away. I often tell my buyer clients to share my name with any open house agent. 

Follow-up

If you have further interest after visiting a home follow up with your Realtor, if you have one. Schedule a private showing, obtain any disclosures or supplements, etc. If you are not working with someone and end up calling the listing agent for more information, do you know they will be representing the seller. If that agent ends up representing you it would be considered “dual agency”. To avoid dual agency, however, I recommend finding a buyer’s agent to help you. (More on Minnesota’s agency disclosure requirements here.)

As we approach holiday seasons, the number of new homes entering the market drops considerably. Know that come “spring” market, usually early January, the number of listings will increase, but so will the competition. Late fall and early winter are great times to get ahead of the pack and visiting open houses can be a helpful first step.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes to inform buyers and sellers on variety of topics including market conditions, tips for selling and buying, homeownership trends, and more. Reach her at heidi@lyndenrealty.com or 651-503-1540. 

Home Buying 101: What are closing costs?

When buying a home, your closing costs will typically consist of a variety of fees and expenses to pay for services associated with the transaction. These fees must be paid in full at closing and cannot be rolled into your mortgage. While the specific costs can vary depending on factors such as the property value, location, and mortgage lender, here are some common components of a buyer’s closing costs in Minnesota:

Loan-related Fees

These fees are associated with the mortgage loan and can include:

a. Origination Fee/Admin fee/Processing Fee: This fee covers the lender's administrative costs for processing the loan.

b. Discount Points: Buyers may have the option to pay discount points upfront to reduce the interest rate on the mortgage.

c. Appraisal Fee: This covers the cost of assessing the property's value.

d. Credit Report Fee: Lenders typically charge a fee for obtaining and reviewing the buyer's credit report.

e. Loan Application Fee: Some lenders may require an application fee for processing the mortgage application.

f. Underwriting Fee: This fee covers the lender's cost of evaluating and approving the loan.

g. Mortgage Insurance: If the down payment is less than 20%, the buyer may need to pay mortgage insurance premiums.

h. Title Insurance: The purchase of lender’s title insurance premium to protect against any title issues.

Title-related Fees

These fees are associated with ensuring a clear title and conducting the necessary searches. They can include:

a. Title Exam/Services: The cost of searching public records to verify the property's ownership history

b. Title Insurance: The purchase of owner’s title insurance premium to protect against any title issues. This is separate from the lender’s policy.

c. Closing fee: Payment to title company for providing closing service

c. Recording Fees: Fees charged by the county for recording the deed and other relevant documents.

d. Survey Fee: If a survey is required or desired, the buyer may need to cover the cost of a professional surveyor.

Government Fees

These fees are typically required by the state or local government and can include:

a. Mortgage Registration Tax (MRT): Minnesota imposes a mortgage registration tax on the principal amount of the mortgage. MRT is paid when recording a mortgage. The rate is 0.0023 of the mortgage amount. Hennepin and Ramsey Counties add an additional .0001 for an environmental response fund (ERF) per Minnesota Statute 383A.80.

b. Property Taxes: May need to be pre-paid at closing.

c. Transfer Taxes: Taxes imposed by the state or local government on the transfer of real estate ownership. In Minnesota, state deed tax is most often paid by sellers, however.

Prepaid Expenses

Buyers may need to prepay certain expenses at closing, such as property taxes, special assessments, homeowners insurance premiums, and mortgage interest for the remaining days of the month.

If you’re buying into a Common Interest Community (condo or townhouse) you’ll have Homeowners Association (HOA) dues which sometimes need to be paid in advance.

Miscellaneous Fees

Buyers may incur additional fees such as courier fees, wire transfer fees, conservation fees, attorney fees (if applicable), and other costs associated with the transaction.

Realtor Fees

If you are working with a real estate agent to find a home you most likely signed a contract at some point in the process. The most common type is a Buyer Representation Contract with an exclusive right to represent. Most brokerages in and around the Twin Cities charge buyers a retainer fee for their service, with a dollar amount written into this contract.

And, depending on what is agreed upon in your Buyer Representation contract, you might also pay your broker/agent for the service they provide.

What are seller-paids?

In a buyer’s market it is not uncommon to ask sellers to pay part or all of your closing costs, often referred to as seller-paids. You would simply write in a dollar amount or percentage of the price on the purchase agreement at the time of making the offer. Unfortunately for buyers, this hasn’t been the norm for a while. In a fiercely competitive market, asking for seller-paid closing costs puts buyers at a disadvantage if it lowers the seller’s net proceeds compared to competing offers.

It's important to note that the specific closing costs can vary, and buyers should receive a Loan Estimate and Closing Disclosure from the lender, outlining the estimated costs prior to closing. Working closely with a real estate agent and mortgage lender can help you understand the closing costs specific to your situation and ensure you are adequately prepared for the expenses associated with purchasing a home in Minnesota.

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Banner photo by Georgie Cobbs on Unsplash

Women and Homeownership

Who are typical home buyers? In the U.S. married couples make up the majority. Single women, however, are next. Since the National Association of Realtors® began recording home buyer profiles back in 1981, single females have made up the second most common demographic. The trend is holding steady. While the majority of 2019 home buyers were married couples (61%), single women represented the next largest group (18%), ahead of single men who made up just 9%.

In 2003 I was one of those women. I knew exactly why I wanted to buy a home (build equity, have freedom to make it my own) and have never regretted my decision. I suspected others in my position may have felt the same, but wanted to hear their two cents. So I asked friends and past clients three simple questions: Why did you buy a home? What do you like about owning? What advice would you give others who are thinking about buying. Read the Q&A below!

Characteristics of Homebuyers | 1981-2019*

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Elizabeth

What's the main reason you decided to buy a home?

I wanted to build equity, avoid "throwing my money away" on apartment rent, have the pride of owning my first home in my mid-20s, and put roots down after moving back home to MN.

What do you like about owning your own home?

With a condo, I love not having to worry about the yard work/shoveling/etc. that comes with buying a single family home. I have loved learning new skills such as fixing a dripping faucet and transforming the space into my own.

What advice would give others who are thinking about buying a home?

I would tell others not to settle. It was a sellers’ market when I purchased my home, and I saw a lot of properties before getting my offer accepted. I'm glad I stuck with the process, because I wouldn't have been happy settling on some of the other properties I looked at.

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S.J.

What's the main reason you decided to buy a home?

So I could adopt a super sweet dog. :) I also wanted to invest in myself. I yearned for a small morsel of land where I could grow flowers/veggies and a space where I always felt comfort and safe. I wanted the flexibility to express myself creatively and to expand my knowledge/skills through the process of remodeling a fixer-upper. Joining a supportive neighborhood community was also an important reason I decided to buy a home.

What did you like about owning your own home?

I enjoyed coming home to a quiet, cozy space that I had created. I loved the freedom. I could do my laundry whenever I wanted, let my dog roam freely in the fenced in backyard and even walk around naked! It felt empowering to fix the toilet, leaky faucets, loose door handles and to learn as I went along. I grew close to my neighbors and felt like I was part of a meaningful community. I was able to walk to the river and neighboring businesses which had an added environmental bonus.

What advice would give others who are thinking about buying a home?

It’s a leap worth taking! Do your homework to know how much you can afford, factoring in a buffer for unexpected expenses. Know that something will always need your attention and any dream-worthy remodel will always take longer than expected. Don’t rush it. Live in a 50’s style kitchen for a year to form a clear vision. If the flowers die or the vegetable garden struggles, no worries! You can always try again next year. Enjoy the process. Find a good realtor to help guide you along the way. Oh, and adopt a dog.

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Jessica

What's the main reason you decided to buy a home?

I had thought about owning my own home for a few years since I'd had bad experiences with renting. I was becoming more financially independent and progressing more in my career. My budgeting had become much better over the years and I had learned enough about mortgages to be confident that it was the right time to make a leap.

What do you like about owning your own home?

I love decorating my space and learning more about my house and how to take care of it. I started gardening a few years ago and I'm really excited that spring is around the corner so that I can start making outdoor plans. I have long-term projects for the house as well and I look forward to accomplishing those goals.

What advice would give others who are thinking about buying a home?

I was nervous about finding the right house for just me but there are so many options out there. Just keep your mind open, stay positive and be sure you have a realtor that understands what you're looking for and can give you the pros and cons, which in my case, was an older home with some character. I wasn't looking for a fixer upper but I probably couldn't afford a pristine home and it was important to have someone who could give me honest feedback about the sort of projects and maintenance a prospective house would need.

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Tammy

What's the main reason you decided to buy a home?

Truth be told I did not want my son at the time, 2 years of age, to grow up in an apartment. I wanted to raise him in a home with a yard and place we called ours. I never once thought I could not do this. I wanted to give my son the same upbringing I had — a home with a yard!

What do you like about owning your own home?

When you own your home you can make it a place where your family and friends are always welcome with your own style. The best part of owning a home is you are building equity — like putting money in the bank that one day will be paid off and then you own your home free and clear!!

What advice would give others who are thinking about buying a home?

I highly recommend buying a home verses renting, it’s a smart investment and you will never lose on it!!

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Thank you

Sincere thanks to Elizabeth, S.J., Jessica and Tammy for taking time to respond, sharing your wisdom and inspiring others!

Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540. 

*Source: National Association of REALTORS® 2019 “Profile of Home Buyers and Sellers”

COVID-19, “Stay at Home” and Real Estate in Minnesota

Minnesota’s governor has ordered a “stay-at-home” order effective Friday, March 27 at midnight. What does this mean for the local real estate market and people looking to buy or sell a home?

The Executive Order exempts a number of “Critical Sectors” that will remain open for business — “Real Estate Transactions” is one of these sectors. According to the order, this category is “limited to workers who facilitate and finance real estate transactions and real estate services, including appraisers and title services.” Realtors help facilitate transactions, so as long as we comply with COVID-19 Guidelines set forth by the Minnesota Dept. of Health (including hygiene, social distancing, etc.), we may keep assisting our clients with buying and selling their homes.

Related services like inspections, appraisals, photography, lending and title work will continue as well. For anyone moving, the order includes an exemption for individuals to move to a new home or place of residence provided they follow the Minnesota Department of Health (MDH) Guidelines to the maximum extent possible. (Moving companies are also considered “essential” and are open for business.) So, Minnesota buyers and sellers, please know your team will be in place during this time, ready and willing to help.

Keeping Clients Safe

Over the the past few weeks, Realtors and Regional MLS Services, guided by the state and national associations, have been rapidly responding to the evolving state of the COVID-19 pandemic. Our intent has been to keep all parties safe, stop the spread of the virus and continue helping clients sell and find homes (a real need for many people despite these uncertain times.)

To help clients and customers understand the precautions and policies being implemented in and around the Twin Cities, I’ve put together a list of FAQs with answers based on the most up-to-date information from our state Realtor® association, our Regional MLS, and anecdotes from the field. This information will evolve; here’s what we know as of today.

Will there be open houses?

No, not for now. On March 25th the Northstar Regional MLS, where the majority of homes get listed, notified its subscribers (mainly Realtors) of the following regarding the new open house scheduling restrictions:

Effective now [March 25] and until further notice, the scheduling of Open Houses in NorthstarMLS has been suspended. Any currently scheduled Open Houses in the NorthstarMLS system have been cancelled and removed from the MLS. This decision was unanimously approved by the NorthstarMLS Executive Committee of its Board of Directors in the interests of public safety during this crisis.

This ban may be lifted at the end of Minnesota’s “stay-at-home” order.

How can home shoppers view homes for sale?

Demand for homes has been holding steady this month as more and more new properties enter the market. We’re still seeing listings get snapped up in multiple offer situations, despite the pandemic disruption. If you’re out shopping this spring, how can you get in to see these new homes? I recommend working with an agent to book private showings. Virtual tours and FaceTime tours can useful as well, though not quite the same.

Private Showings

If the seller agrees, a property can be toured by scheduling a private showing, which is how homes are typically viewed. But it can get crowded. Day (or week) one of a popular new listing can draw hordes of buyers, and their agents, all touring at once. But no more. Though agents have been advised in recent weeks to not allow overlapping appointments, beginning March 25th our scheduling software made it impossible to do so. As a result, the number of people touring a home in a private showing will be limited to one agent and her or his client(s).

Realtors have also been advised to provide hand sanitizer, foot coverings, gloves, etc. at entry points and to ask buyer clients to walk through homes with hands in pockets, or at to least avoid touching surfaces like light switches, door handles, cabinets pulls, etc.

If you’re a buyer, plan to meet your agent at the property as Realtors have been asked to drive separately from their clients for the time being. Social distancing is the goal when touring homes, and it can be quite easily achieved with these precautions in place and persistent behavior on the part Realtors and their clients.

Virtual Tours

Another way to get an up-close look homes is through 3D virtual tours. Though not the same as viewing in person, a 3D tour can be a useful way to do a preliminary walkthrough before deciding on a private showing. Lynden Realty uses Matterport technology when marketing homes which allows viewers to navigate virtually, “walking” room to room and floor to floor. Check out this sample from a current listing.

Sellers should be aware that virtual 3D marketing is always an option when listing a home, and may be especially helpful during periods of social distancing.

Zoom Tours

Using Zoom, FaceTime or a competing platform can also be a useful alternative to live tours. I’ve used this technology with out-of-town clients who want to see more than just photos but can’t make the trip. This type of “showing” has now become a new normal.

Our local MLS recently added “Virtual Showings” as a new appointment type for touring homes through the Showingtime scheduling app. Buyer’s agents can now officially and transparently request a virtual tour from sellers. The buyer’s agent can also add a note for the listing agent/sellers indicating which streaming video technology they’ll be using (FaceTime, Zoom, etc.).

Though screen viewing can’t replace the live experience of walking through a home, it might help in your preliminary search. Consider asking your agent to virtually tour a home with you before proceeding with an in-person showing. It may be a safe and effective way to pre-screen properties before moving forward in your search.

What can be done electronically or remotely?

Just about everything. With the exception of live home tours, inspections and some required “wet” signatures, most everything in the home buying and selling process can be done electronically. Our e-signing software makes signing contracts, disclosures, purchase agreements, etc. a breeze. With wifi access, clients can even read and sign documents on their smartphones.

Closing companies have been advised to conduct closings with buyers and sellers in two separate rooms, or at least spaced 6 feet apart. And “pre-signing” alone on a preceding date can also be an option, especially for sellers.

Earnest money deposits can be submitted electronically through an app called TrustFunds. Many brokerages had already been using electronic transfers (versus delivery of a personal check); it’s now being used more widely.

Learn more

Real estate professionals throughout the Twin Cities are well aware of the situation and are working together to keep clients and each other as safe as possible. If you have questions or concerns about how the process of buying or selling may affect you during this time, please don’t hesitate to ask. Heidi@lyndenrealty.com | 651-503-1540

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540. 

What does “Coming Soon” mean in the Twin Cities?

{Spring 2021 Update: At the time of initial publication regional Northstar MLS “Coming Soon” properties were not synched to IDX (Internet Data Exchange) sites like Zillow. Agreements between Northstar and those sites have since changed — all Coming Soons are now shared and visible.}

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Spring 2019 marked the first home-selling season with the regional Northstar MLS’s “Coming Soon” status in play. The parameters for listing a property as “Coming Soon” are well defined by our MLS and many agents have started strategic use of this option. There may be some confusion for consumers, however. Here’s what home buyers and sellers need to know when they see a home listed as “Coming Soon”.

It’s not Zillow

It’s not the same as Zillow’s “Coming Soon”. In fact, unlike Active, Pending and Sold MLS listings, “Comings Soon” properties are not even visible on Zillow. Northstar MLS has not (yet) contracted with Zillow or similar synched-up sites like Trulia to allow access. Zillow has rights to display homes with other listing categories, but not this one.

This MLS option should not be confused with a similar feature on Zillow that allows home owners and “Premier Agents” (Realtors paying to advertise) to create separate Zillow Coming Soon listings. The two are not the same. Our MLS “Coming Soon” properties can only be viewed by MLS subscribers (agents, brokers and real estate professionals) and are typically emailed directly to clients via the MLS database.

Coming soon…how soon?

A property can be “Coming Soon” in the MLS for a maximum of 21 days. With home seller approval, the agent/broker manually sets an activation date when creating the listing. When that date hits, the status automatically switches to “Active” and goes live on major search sites. If the sellers aren’t ready to show by that date they have a couple of options: cancel altogether or switch it to TNAS (Temporarily Not Available for Showing) — a common short-term delay maneuver used for a variety of reasons (unexpected repairs, houses guests, etc).

Can I tour a “Coming Soon” listing?

Strict rules set up to create fair play prevent listing agents from showing a home when its status is “Coming Soon”. In fact, an agent could be fined $1000 for doing so. Once a home is “Active” in the MLS sellers should be ready to allow showings, but not before.

Buyers’ agents can, however, request showings for anytime after the “Active” date, even if it’s 3 weeks out. So if you want to be the first one in a property once it’s live/active, get a showing appointment request in asap. Planning ahead to be the first one to view a home is a smart move in a tight seller’s market.

Why no photos?

“Coming Soons” require a minimum of one photo to be listed. Some agents are adding more now but I still see many with just one or two exterior shots. This can be a source of frustration for buyers whose interests are piqued by location, price and curb appeal but still want to see the inside. If you’re not seeing the full set of photos right away do check back. The listing agent will likely add the rest on or near the “Active” date.

Buyer advantage

In this fast-paced seller’s market the “Coming Soon” option may give buyers some room to breathe as well as the luxury of lead time for making a sound decision. If enough information is revealed in a “Coming Soon” listing (full set of photos for example) buyers may be able to decide yea or nay before it goes active. If the home is of interest, shoppers can use the interim to mentally prepare their offer price and terms, jockey schedules for a fast future showing and connect with their lender for an updated pre-approval. It may enable them to act swiftly with a competitive offer when the time comes.

Seller strategy

If you’re contemplating selling your home, you should seriously consider your options for a successful entrance into the market. Creating an effective “Coming Soon” listing is one strategy but it might not be right for your situation. A poorly planned entrance can easily backfire, even in a hot seller’s market.

Create a course of action that makes sense with current buyer activity and your target market — of course I recommend working with a real estate professional when doing so. A good agent who stays on top of local trends (what’s working and what’s not) will be an invaluable resource in helping you take advantage of the seller’s market now in full swing around the Twin Cities.

If you want to know more or need some advice I’m happy to talk through selling (or buying) strategies. If you want to keep watch for “Coming Soon” listings in particular neighborhoods or cities, I can set those up as well.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

No. 1 Thing Home Buyers Should Do (Before Shopping)

If you’re gearing up to buy soon you’ve probably been perusing new listings and hitting a few weekend open houses. Smart moves. The faster-paced Minnesota spring market will be here before we know it so it’s good to get a sense of what’s out there.

Looking at houses the fun part (for most!) If you find your dream home though, and haven’t done this one critical first step (unless you’re paying cash) there’s a good chance you’ll miss out. What’s the number one move? Getting pre-approved for a loan.

Low inventory throughout the Twin Cities has increased competition among buyers, especially for those looking in the lower price ranges. Sales with multiple offers were typical last spring and summer, and the 2020 selling seasons will most likely be repeats. If you want to compete in the spring market start working with a lender asap, if you haven’t already. Buyers who cannot demonstrate their ability to finance a purchase with not be taken seriously. If you’re in position to buy soon, get a pre-approval letter in hand (or in email) before you set your sights on a home. Sellers will not want to view your offer without one.

GET HELP

A trusted loan officer ought to be a valuable support in the potentially daunting process, so should a good Realtor. The agency relationship you establish as a home-buying client in Minnesota is meant to benefit and protect you. Serious home buyers would be wise to put this additional important step at the top of their lists.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Photo by Tierra Mallorca on Unsplash

What Sellers (and Buyers) Should Know About Minnesota Property Disclosure

If you’re buying or selling a home in Minnesota you’ll need to get familiar with the state’s required disclosure laws. Sellers of single-family properties (including condos, townhomes and co-ops) are legally required to disclose in writing any known information that may adversely and significantly affect a buyer’s use or enjoyment of their property (MN Statutes 513.52 through 513.60).

Minnesota homeowners planning to sell should be aware of this requirement prior to listing. They should also understand the liability involved in such a disclosure. (They can be held liable for up to two years for intentionally omitting or misrepresenting information.*)

Home buyers in Minnesota need to know where and how to access this information, what to look for and what alternatives sellers may use in lieu of the standard form.

The Minnesota Seller’s Property Disclosure

The Minnesota Association of Realtors (MAR) uses a standard Seller’s Property Disclosure form to satisfy the statute requirements. Sellers fill out this 10-page form to the best of their ability, sign and make it available to prospective buyers during the listing period. Typically, the listing agent will upload a copy to the MLS where buyers’ agents can view, download and share with interested clients. Hard copies may also be left at the property for viewing during open houses and private showings. A buyer making an offer will need to sign the Seller’s Disclosure and present it along with the purchase agreement.

Filling it out

Homeowners should make a good faith effort to disclose all material facts to “the best of the seller’s knowledge at the time of the disclosure.” They must complete it themselves (Realtors cannot contribute) and should check any previous disclosures or past inspections for additional information.

Updating as needed

If anything changes from the date the Disclosure is completed and signed through the day of closing, sellers must notify the buyers in writing with a signed amendment disclosing any new information. Your real estate agent can provide a blank amendment.

The Minnesota Disclosure Alternatives Form

Sellers may choose one of two alternatives to the full Seller’s Disclosure — either a third-party inspection or a waiver. To satisfy one of these two options MAR uses a second “Seller Disclosure Alternatives” form which is also shared with prospective buyers. A seller checks one of two options, signs and makes available to buyers along with any corresponding inspection reports.

Third Party Inspection

One alternative is to provide a “qualified third party” inspection report. A qualifying party would be any “federal, state, or local government agency, or any person whom the seller, or prospective buyer, reasonably believed has the expertise necessary to meet the industry standards of practice” for preparing such a report. This option will most likely cost the seller and isn’t often used. When this report is provided, sellers and their agents are still obligated to disclose any known material facts that contradict the report or that are omitted from it.

Waiver

If buyers and sellers agree, the Sellers Disclosure may be waived. The “Waiver” box is then checked on the Alternatives form and both parties sign off on it. Why might a seller choose a waiver? Reasons vary but it’s sometimes due to simple lack of information. For example, if adult children sell their parents’ home having never lived there, they may choose a waiver. Or if an investor sells a home that was occupied solely by renters, a waiver might make sense. Seeing a waiver can make buyers nervous, however, so I typically recommend that home sellers share as much information as possible using the full Disclosure form.

Common Red Flags for Buyers

If you’ve found a house that fits and are thinking it’s the one, you should examine all disclosures. Your real estate agent should provide them. If not, ask.

What do buyers commonly look for when reviewing the Seller’s Disclosure? Big ticket items like age of the roof (if known) and details relating to any past damage to foundation, windows, walls, siding and roofs of all structures should be noted. Water seepage and sewer back ups can also be red flags, though basement moisture is not uncommon in older Minnesota homes. A previous sewer back-up could signal a future problem unless properly remedied. Getting a sewer scope during your inspection period can be money well spent if you suspect an issue. Checking for a past problem on the Disclosure is a good place to start.

Past work done on the property must also be disclosed along with any work done without appropriate permits. You’ll also want to check for any easements, encroachments, restrictions, etc. These items, often found through title searching, aren’t always visible but may affect your use and enjoyment. Buyers can also check the working order and presence of all appliances and systems including heating, electrical, plumbing and mechanical.

Disclosures NOT Required by Sellers

• Ghosts, paranormal activity

• Natural death or suicide

• HIV-infected owner or occupant

• Proximity to adult residential facilities

If you suspect your house is haunted, you’re not legally obligated to share. In addition to paranormal activity, sites of suicide, natural or accidental deaths need not be disclosed (murder on site is required.)

Disclosure of homes currently or previously “occupied by an owner or occupant who is or was suspected to be infected with human immunodeficiency virus [HIV] or diagnosed with acquired immunodeficiency syndrome” is not required.

Sellers also are not legally obligated to disclose whether the neighborhood has an “adult family home, community-based residential facility, or nursing home.”

Read the full statute section here.

Selling? Plan Ahead

If you’re planning to list soon you should get familiar with this form, begin formulating your response and start digging up past disclosures and paperwork that might be useful. Do you remember purchasing title insurance, for example? Your old closing documents may have the answer. Can you recall years when you did major repairs? Look for old receipts to confirm when and what work was done. If work was extensive, start making a list of everything, it can be attached to the Disclosure saving you time when you’ll most likely need it. Read through the form carefully and highlight unknown terms. Your agent should be able to clarify or at least point you in the right direction when filling out this form.

If you would like to learn more about our state (and city) disclosure requirements feel free to connect. heidi@lyndenrealty.com

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

*Consult with legal professional for advice if needed

Image by WikimediaImages from Pixabay

Winter 2019 Housing Market Update | Twin Cities

Median values across the metro continue inching up while inventory stays low, but not quite as low as last year around this time. Over the past 12 months the median home price in the Twin Cities Region rose 5.98% to $280,000 in November 2019. The months supply of homes for sale increased by 4.7% to a 2.2 months supply this November compared to 2.1 last. During this 12-month period the total number of new homes for sale increased by 2.5% to 10,959 across the 16-county region while the average number of days on market remained steady at 49. This is good news for buyers who have slightly more choices than last year, however, the market still favors sellers with low inventory (especially at lower price points) and median home values increasing overall.

$280,000

Minneapolis | Median Sales Price

Nov 2019

$224,450

St. Paul | Median Sales Price

Nov 2019

Seasonal Trends

Cold weather and holidays mark the slow season for home buying and selling in Minnesota. These predicable dips in inventory and corresponding sales typically begin the last weeks of summer and bottom out around January. We’re in the downslope now but I’m still seeing hard-to-find homes selling within days, especially in the most sought-after neighborhoods.

Selling

For homes that do sit longer, sellers sometimes choose to pull them off the market temporarily over the holidays. This “off market” status stops the clock, minimizing visible days on market, so it can be a smart move for listings with dwindling activity. Cancelling and re-listing after the New Year is another option for sellers wanting to reset and come back on as “new”.

Buying

Buyers who find their dream home during these slower months might want to act. There’s most likely less competition, so less pressure to bid up. It’s also more likely they’ll be working with motivated sellers who may be more willing to negotiate on price and terms. And interest rates are still historically low — excellent news for non-cash buyers. Come spring, there will be more homes to choose from but also more shoppers, raising sellers’ expectations. A competitive spring market will likely generate multiple offer scenarios and greater hope among sellers who hold out for highest and best, adding stress to an already (potentially) stressful process.

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Data derived from Northstar MLS 12/4/19. Includes all home styles (single-family, condo, townhouse), sizes, and construction types (new and existing). Twin Cities Region includes 16-county metro area.

Local Trends

Real estate markets are often hyperlocal so it’s worth taking a closer look at variations within the two cities and their surrounding suburbs.

St. Paul

A late-fall snapshot of the St. Paul market reveals a steady increase in sales prices with inventory still low at most prices, especially below the $600K mark. St. Paul’s overall median sale price for all home types rose 6.78% over the past 12 months — from $210,000 Nov 2018 to $224,450 Nov 2019. Compared to Minneapolis’s $280,000 median price, the capitol city remains a more affordable option for buyers seeking walkable neighborhoods with urban amenities. Current St. Paul homeowners may welcome the news of continued bump-ups in sales prices, especially those looking to sell soon.

% Change in median sales price - Nov 2018 to Nov 2019

Date derived from Northstar MLS 12/4./19. Includes all home types (single-family, condo, townhouse), sizes, and ages.

Several of St. Paul’s more affordable neighborhoods experienced some of the highest year-over-year increases. Payne-Phalen, for example, topped the chart with a +11.17% jump from fast fall, and Thomas-Dale had the second highest increase despite being the third most affordable area.

In some instances, an overall median price fails to reveal insignificant variations within a neighborhood. For example, homes sold in the past 12 months in Summit-University ranged from $83,000 to $2.2 million. Though not an apples-to-apples comparison, it’s important to note such drastic differences and stay cognizant of how values can change block-by-block. If you’re working with a real estate agent they should be neighborhood-savvy enough to understand where and how values shift in your area.

Minneapolis

Minneapolis home prices also continued their steady rise over the past year. November 2019 data revealed a median value of $280,000 for all home styles, sizes and sale types — a 7.3% increase from the November before. The city’s median values remain higher than St. Paul’s and a 10-year trend shows that gap slowly expanding.

The median sale price of newly constructed MLS-listed* condos has dipped slightly since last year at this time, while inventory levels inched up a bit to a more balanced level. The November 2019 median price for newly-built condos was $538,439, down half a percent from last November. Late fall inventory levels of new units remain low-to-balanced with a current 3.4 month supply, up slightly from a 2.2 months supply the fall before. The combo townhouse/condo median sales price of both new and previously-owned units increased by 14% over the last year, far exceeding the 4.3% increase in the city’s single-family market.

How does Minneapolis compare overall to its immediate first-ring neighbors? On average, it sits near the middle, with Edina at the high end ($470,000) and Brooklyn Center at the low (220,000). Cities just west of downtown hold value as second highest — Golden Valley and St. Louis Park have fall 2019 median sale prices of $339,500 and $304,500, respectively. Of course neighborhoods vary greatly so specific locations, and even certain blocks within a community, should always be considered when determining real market values.

Data derived from Northstar MLS 12/4/19. Includes all home styles (single-family, condo, townhouse), sizes, and construction types (new and existing).

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Aside from the predictable winter slow-down, it’s still a seller’s market, especially for fairly priced, move-in ready homes. And despite having fewer choices, shoppers are still out, though not as many as in spring & summer. Buyers who do shop diligently during winter months can sometimes be more aggressive, needing to buy within a certain timeframe. Why else would they brave the cold at showings and open houses? Leisurely lookers also peruse winter listings however, often waiting and watching for price drops. Though situations do vary, factors like rising rents and low interest rates continue to motivate many shoppers.

Sellers who need or choose to list this time of year shouldn’t lose hope, homes do sell in winter. If timing isn’t a factor though, waiting until after the New Year might not be a bad idea. Listing in late January/early February could catch waves of early-bird buyers, eager to get ahead of the competition. Everyone’s situation is different though, so it can be helpful to talk it through. I’d be happy to assist with any questions about the timing of selling or buying. Feel free to reach me at heidi@lyndenrealty.com or 651-503-1540.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on a variety of real estate related topics including buying and selling, market conditions, homeownership trends and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

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*New condos sales and inventory numbers from Northstar MLS database; they do not include in-house sales from developers.

Banner photo credit: Hal Tearse from Pixabay

What does "off market" mean in the Twin Cities?

If you’ve been shopping for homes on sites like Zillow and Trulia you may have noticed several previously listed homes suddenly going “off market”. Why is this happening? Does it mean they’re no longer available? Maybe, maybe not. A closer, more accurate look into our MLS database often reveals a switch in status — from “Active” to “Temporally Not Available for Showing” or TNAS. Since third party sites like Zillow don’t display TNAS, this change can be confusing. So what does TNAS mean?

Temporarily Not Available for Showing (TNAS)

When an active listing will be unavailable for showing appointments for more than 24 hours, the listing should be switched to TNAS, according to the rules of our local MLS. This could happen for any number of reasons — a needed repair, repainting, a light remodeling project, etc. A common reason this time of year is holiday activity. A home seller may be entertaining house guests over a long weekend and wishing not to be displaced for showings. Or, they may be traveling for an extended period and prefer not to have strangers in their home while away.

Another reason for TNAS might be response to a slowing winter market. Cold weather and holidays reduce market activity as people’s priorities shift. Some sellers would rather wait out these weeks or months by stopping showings temporarily, then switching to “Active” again once holidays pass. Doing so also stops the clock counting the number of days on market, so the days in TNAS won’t affect the overall time on market, as publicly displayed.

Third party sites like Zillow translate TNAS to “off market”, which can be puzzling. The best way to get accurate status updates on past or current listings is to ask a real estate agent who has access to the local MLS. A status look-up is a quick first step in getting up-to-date info on a home. If additional notes in the listing don’t explain more, a call to the listing agent usually solves the mystery. I do this often for clients who are searching online.

TNAS status isn’t the only data gap in sites like Zillow. Properties listed as “Coming Soon” in our MLS currently do not get displayed on Zillow and its affiliates. “Coming Soon” is a fairly new option for sellers in our region and is still gaining traction. Read details on it here.

Pocket Listings

The “off market” status for TNAS listings should not be confused with properties being actively marketed by agents before going live on the MLS. These types of listings have a variety of names including “pocket listings”, quiet listings", “pre-MLS”, “non-MLS”, and “off market”. The practice of marketing selectively, before officially entering the listing into a universally shared network, has been debated nationwide and will be banned by the National Association of Realtors beginning Jan. 1, 2020, with full implementation expected by May 1. Once in effect, the rule will require brokerages to submit listing information to their MLSs within one business day of any public marketing. The new policy is intended to level the playing field and maintain the industry’s focus on cooperation and broker reciprocity, ultimately benefitting both buyers and sellers.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying, selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

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Banner photo by Eugene Zhyvchik on Unsplash

Screenshots taken 11/27/19: TNAS listings and 2196 St. Clair on Zillow (not listed with Lynden Realty)

When is the best time to buy a home In Minnesota?

Should I buy now or wait until spring? I’ve been asked this question a lot lately. Everyone has a different story so my first response is often a question…When would work best for you? It often depends on your life situation. Are you renting and need to wait out your lease? Or can you end the lease without penalty? Do you need to sell a home first before buying? Or can you afford to buy first and sell later? Would you like your kids to finish out the year before switching schools? Maybe you’re moving into town and want to get settled before starting a new job. Or you may be living with parents or family with maximum moving flexibility.

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Spring: more choices, more competition

If you’re not bound by leases, job transfers or school schedules, consider our seasonal market trends along with the larger economic picture. In Minnesota spring is typically the hottest season for real estate. Historically, more homes get listed in the spring and summer months, so as a buyer you’ll have more to choose from. You’ll also have more competition. Warm weather coupled with an expanding inventory attracts more home shoppers. The last few spring markets have been highly competitive with multiple offers and overbidding as the norm in the most desirable homes and neighborhoods. Low inventory has been a major factor, especially at the starter-home price point.

Seasonal trend | New Listings

Winter: price drops & low inventory

Winter months, especially around major holidays, tend to slow market activity. As a buyer, you may be in a better position to negotiate a lower price during these months. The slower pace may give you more time to process, decide and present your offer. Anxious sellers might be more willing to consider price drops during colder months as they rack up days on market. But don’t expect an automatic deal. Some sellers are more than willing to wait out the slower months in hopes of a strong offer come spring. They may even decide to temporarily pull their house from the market over the holidays then pop it back on once the weather warms.

Seasonal trend | Median sales price

Get ready

My best advice is to be prepared. Get your finances ready with a pre-approval in hand, watch for new listings and get out there. Visit as many houses as you can so you know exactly what you want and don’t want. Walking through a house is very different from clicking through pictures, so take the time to tour! Open houses are one way of course but private showings are even better (do it on your time without the seller’s agent hovering.) If you find your dream home in the slower winter months, perfect! Make your move. If not, hold tight, there’ll be more to come as spring approaches.

If you’re seeing houses online and what to know more, give me a call or email to set up a private tour or get details on particular listing. 651-503-1540 | heidi@lyndenrealty.com

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540. 

Summer 2019 Housing Market Update | Twin Cities

“Slow and steady” best describes movement in the Twin Cities housing market this summer. MLS* data crunching reveals gradual increases over the past year in median sale prices for single-family homes, condos and townhouses across the metro, with very little change in inventory. The difference in the number of new listings this June, though higher than last, was barely detectable. From June 2018 to June 2019, new listings for all home types went up by a mere 1.5% across the 16-county Twin Cities Region, 6% in Minneapolis, and actually decreased by .5% in St. Paul. When considering supply and demand, it’s still a seller’s market.

New Home Listings | 3-Year Trend

Prices Going Up

The overall trend in median sale prices reveals a steady rise, also good for sellers. From June to June, the median increase for most home types was in the 6-7% range. An exception was the Minneapolis condo market which experienced a double-digit boost (17.5%) for newly-built MLS-listed units. St. Paul’s single-family homes and condos/townhouses increased at the next highest rates (7.3% and 7% respectively). Minneapolis single-family prices went up 6.3% just ahead of the Twin Cities Region’s overall 6.1% jump.

In June 2019 the median price of single-family homes in St. Paul was $219,000, up from $205,000 the year before. During the same period, Minneapolis single families increased from $253,950 to $270,000 while the Twin Cities Region’s median values for similar properties rose from $277,000 to $294,000.

Those looking to buy may have been challenged finding the right fit this spring & summer but activity seems to have slowed around the July 4th holiday giving serious buyers some room to breathe. Current mortgage interest rates are an added incentive this season. Locking in low can keep payments down or open up options to buy higher in a market with a less-than-healthy supply.

Median Sale Prices | Single Family Homes

Regional MLS data includes all home sizes, ages (newly and previously built) and sale types (traditional and bank-owned). Each data point draws from 12 (rolling) months of activity.

What’s a “Single-Family” home?

A stand-alone home designed to accommodate one family. In comparison, “multi-family” homes like duplexes and triplexes are built and zoned for more than one family.

Low Inventory

Despite having slightly more homes to chose from, some buyers are still struggling to find the right fit. The region’s early summer supply of 2.4 months is well below the 5-6 months needed for a balanced market, and home shoppers can feel the scarcity. It’s especially noticeable with on-trend, move-in-ready homes in the most sought-after cities and neighborhoods. Minneapolis and St. Paul supply levels, though up a tad bit from last year, remain frustratingly low for people wanting to find the right home for the right price in their favorite neighborhoods. June 2019 data reveal a meager 1.7 months supply of single-family homes for sale in both Minneapolis and St. Paul. Condos and townhouses are more readily available but not by much (months supply hovering around 2.5.)

Late spring was especially competitive with multiple buyers offering (and often losing) bids in the tens of thousands over list price for a single property. Activity seemed to have slowed a bit early June, however. Maybe the heat rolling in, school ending, kids graduating or families gearing up for summer trips cooled the jets? Despite summer distractions, buyers are still out there looking to get settled before school starts, the snow flies, interest rates creep up, rents rise, leases expire, etc.

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When to Sell?

If you’re a home owner thinking about selling, warm-weather months are still your best bet in Minnesota. Most people prefer not to move in snow and cold, during holiday seasons, or mid school year if they can avoid it. Once November hits be prepared for a longer time on market as home shopper traffic slows. And if winter weather cuts into fall a slow-down could happen even sooner.

Of course the best time to sell is when you’re ready. In the mean time learn the market, make a plan and get professional help when needed. Despite having fewer choices, buyers are still choosy and will expect to pay less for homes in need of updates or TLC. It’s helpful to know what they’re looking for. Also beware that real estate markets can be hyper-local. What’s true in one neighborhood, or even block, might not be true in the next. If you want help zeroing in on your market, talking through possible updates or learning the selling and buying process, please connect! I’m happy to assist.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

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*All data derived from the Northstar MLS database, the primary listing service used by real estate agents and brokers throughout the Twin Cities and parts of greater Minnesota.

St. Paul Housing Market: Snapshot of Spring 2019

Inventory of available homes to purchase in St. Paul remains low this spring — it’s still a seller’s market at most price points. Minnesota’s busiest season seemed to have a false start late January when the polar vortex and piles of new snow slowed a flurry of new-year activity. It’s starting to pick up but competition among home buyers remains high as new listings lag in comparison to demand.

Warming weather along with lower interest rates may be motivating home buyers to get out and shop. What are they seeing so far? I dug through local MLS data to get a snapshot of activity, search for trends and cross-check stories from the field — this post summarizes my recent findings.

Rising Median Sale Prices

Sale prices in St. Paul continue to steadily rise, in some neighborhoods more than others. Thomas-Dale (Frogtown) and St. Anthony Park experienced the greatest increases in the past year with 16.3% and 15%, respectively. Payne-Phalen and the Greater East Side saw nearly 10% hikes while North End, St. Paul’s most affordable pocket, experienced the least drastic increase at +2%.

Summit-University was the outlier showing an unexpected decrease in single-family homes (-16%). The neighborhood, bordered by Downtown and Lexington on its east-west ends, and University and Summit Avenues to the north and south, contains wide variety of housing options. Single-family homes range from modest and affordable to Ramsey Hill mansions. It also has one of the highest concentrations of condos in the city, especially in and around the Historic Hill District. Unlike the overall single-family home prices, condo values in the neighborhood have been on the rise with the median price for all types and sizes going up 4.7% over the past 12 months.

Downtown single-family median values were non existent in the MLS which is not surprising. Its housing stock is comprised primarily of condos whose median price rose 7.6% from last March to $194,000 for all sizes and types.

Snapshot of St. Paul Homes for Sale | April 20, 2019

Northstar MLS data reflects all sizes, prices, seller types (distressed and traditional), new construction & previously owned from March 2018-March 2019 (Como: Jan 2018-Jan 2019). Does not include "Coming Soon" or homes with accepted offers with contingencies (Ai, for example).

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More Competition for Move-up Buyers

If you’re moving into a mid-to-upper bracket home in St. Paul you have competition. The available inventory of homes in the move-up market is slim, and the number of days on markets for these properties has dropped. In March 2018 the months supply of $600,000-699,000 was 4.8. That number dropped to 2.6 in March 2019, tipping the balance in favor of sellers (5-6 is balanced and favors neither.) Supplies dropped in the $700-900K ranges as well creating more competition for desirable homes at all price points under $1M.

The median number of days on market for mid-to-upper priced properties has also changed significantly in the past year. Homes in the $600-900K price range are selling much faster this spring than last. For example, the median number of days for $600-699K dropped from 74 in March 2018 to 20 in March 2019. Considering the corresponding decrease in supply, these numbers make sense. With fewer homes available, the good ones are going fast.

Months Supply of Homes for Sale | St. Paul

1-year change in supply of single-family homes for sale. A 5-6 months supply is considered balanced. Lower numbers favor sellers, higher numbers favor buyers. MLS data represents both new and previously-built homes of all sizes.

Days on Market | St. Paul | 2018-19

1-year change in number of days on market. MLS data represents both new and previously-built single-family homes of all sizes.

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St. Paul vs. Minneapolis

Lately I’ve met more and more buyers crossing the river in search of homes. Minneapolitans looking to settle in St. Paul are becoming a thing. They tell a similar story of wanting urban amenities at a more affordable price and feel their chosen Minneapolis neighborhoods are financially out of reach. These city dwellers share an appreciation of St. Paul’s charm and walkability where they can easily access restaurants, cafes, grocery and transportation, at a more affordable price.

Historically the median price in St. Paul has been lower than in Minneapolis but the gap between them appears to be growing. Shoppers may be sensing it and MLS data seems to support their claims. Sale prices for all home types have been increasing at a slightly faster rate in Minneapolis (check out the graph below.) St. Paul’s March 2019 median was 215,000 compared to 267,000 in Minneapolis — a slightly wider spread than the respective $125,000 and $150,000 median prices of 2009.

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Spring Market Inventory

If you’re looking to buy this year, don’t let the state of low inventory deter you. Spring may still be the best time to home shop in Minnesota as the number of new listings continues to grow offering more choices to buyers. Last year that number peaked in May with 561 new listings in St. Paul (for all home types). This March we saw 353 new listings, inching up from the low of 134 in December 2018. I’m confident market history will repeat itself when more homes enter the market in the next couple of months. As they do, be prepared mentally and financially to make your move.

New Listings | St. Paul

Derived from Northstar MLS data showing number of new listings by month in St. Paul, MN. Represents all home sizes & types (single-family, condo, townhouse) and both types of construction (new and pre-owned).

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Minnesota Home Shopper? Avoid 3 Common Mistakes

If you’re gearing up to buy a home consider these potential missteps buyers can make, and work to avoid them if possible!

#1 Looking at Homes Before Getting Pre-approved

Unless you’re paying cash, you’ll need to borrow money to buy your home, most likely from a bank. Working with a lender to secure a home loan is a process that takes time so get started as soon as possible. You can do the preliminary part early on and get what’s called a “pre-approval” letter— a document prepared by your loan officer after getting an accurate picture of your finances and creditworthiness. When you make an offer on a house, you (actually your agent) will submit this pre-approval letter with offer. You will not be taken seriously as a buyer without it, so get the financing ball rolling if you’re determined to get your dream home.

I recommend getting pre-approved before you even start looking at homes. There’s nothing more frustrating than finding the perfect home then losing it to another buyer because you weren’t prepared. Sure, it’s smart to get out there and get a feel for the market in your price point — look online, stop by open houses, etc. But when you start dialing in and scheduling private showings with your agent, be prepared! Have a pre-approval in hand or your loan officer on the line ready to write.

#2 Not Seeing Past the Furniture and Decor

Do not let a good staging job fool you. It’s easy and common to react emotionally to decor and furnishings. If it’s the stager’s style or seller’s impeccable taste you love, don’t equate that with love for the home. The giddy feeling of having found the perfect home can be of value — it might reassure you it’s “the one” and boost your motivating for making it happen, and it’s fun to get excited about such a big life purchase. But just make sure you look past the furniture to other aspects of the home like condition, location, minimum features needed or wanted, etc.

On the flip side, don’t let bad furniture and decor deter you. You might hate the curtains, outdated sofa and dusty knick-knacks, but don’t let those prevent you from seeing through to the home and its potential. Just remember, those furnishings will be long gone on closing day. Unless negotiated, anything that doesn’t require a tool to be removed, will need to be cleared away for the new owners.

#3 Not Working with a Realtor

Reasons for working with an agent to buy your home are many. In a nut shell, you have a professional on your side. The seller has one so why shouldn’t you? Realtor are experts in the process, have necessary resources at their fingertips and can share insight on the market to maneuver and negotiate successfully. And the list goes on!

As a buyer working with a Realtor you will most likely be asked to sign a Buyer Representation Contract but do not fear, signing this type of contract secures your relationship as a client rather than a customer. It means your Realtor legally owes you much more than Confidentiality, the sole fiduciary duty owed to customers. As a client under contract your agent owes you not only Confidentiality but Loyalty, Obedience, Disclosure, Reasonable Care and Accounting as well. Check the Agency Relationship Disclosure to learn more about these duties, client relationships and your rights under contract with an agent.

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*Many brokerages around the Twin Cities now charge a “Broker Admin” or “Retainer” fee to both buyers and sellers. In these cases, a buyer would pay for service (I’ve seen fees range from $400-$600.) Lynden Realty, however, does not!

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Beginning Steps for Twin Cities Home Buyers

Once you have made the decision to buy — whether you're down-sizing, upgrading, relocating, or becoming first-time homeowners — you'll want to take some initial steps to smooth out the process: choose a realtor, get pre-approved, refine your search and start touring homes!

Choose a Realtor

Real estate agents advocate on behalf of their clients while guiding them through all steps of the home buying process. They can also be valuable resources for finding other licensed professionals including loan officers, inspectors, closers, contractors, and more. Realtors get paid for their services via commission which is typically a percentage of the final sale price, most often paid buy the seller upon closing (though this may change as the industry changes.) A seller-paid commission usually gets split among all agents and brokers assisting in the sale of the home.

Many brokerages charge buyers retainer fees (though we at Lynden Realty do not.) This is a flat fee written into the buyer contract paid regardless of a sale, typically between $200-$800. When signing contracts for representation be mindful of negotiable items, admin fees included, and don’t be afraid to ask questions.

How do you choose a Realtor? Start by asking trusted friends and family. Most often people get connected through referrals. If your friend or family member had a good experience working with someone, you might too. Depending on your process, you may be spending a lot of time with your agent, so choose someone you like and trust. Communication is also key. Your agent should be conscientious about communicating and skilled at using multiple means for connecting with you and other professionals involved in the transaction.

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Get Pre-approved

If you want to make an offer on a house (and plan on financing it) you will need to get a pre-approval letter, at the very least. Getting pre-approved differs from being pre-qualified in that it requires more than simply applying for the loan. Pre-approval involves an in-depth analysis of your financial background including credit history, employment verification, assets, etc. The process will provide you with a more realistic picture of what your interest rate and payments might be, and will help determine in advance how much house you can afford.

Sellers will favor pre-approved buyers who demonstrate their ability and intent for successfully getting the loan. Most won’t entertain offers without this bank letter, especially in a seller’s market. A strong pre-approval from a reputable lender is an important piece that will put you at an advantage over competing buyers. It's best to get it done ahead of time to avoid a delay when submitting an offer and possibly losing out to other qualified, and more prepared, buyers.

Refine Your Search

An infinite number of factors can help determine your needs and wants when buying a home. Common considerations include things like schools, commute time, space, walkability, neighborhood preferences and of course price. You may also be deciding between a single-family home or condo/townhouse. Make a list of what you're looking for — decide what you can't live without, what might be a deal breaker, and what won’t.

Once you've narrowed your focus and established parameters, you can more efficiently make use of online tools to help with your search. Realtors subscribe to the local MLS database (the most up-to-date resource for finding properties) and can easily create automated searches using your criteria which enable you to receive email notifications of new MLS listings as soon as they become active. Searching on your own can be fun, but the MLS auto emails are an easy and more accurate way to stay up-to-date (I’ve seen Zillow take 4 days to update changes in my listings!) Your search criteria can be easily tweaked at any time if your preferences change. You can also tag properties you love or want to know more about, and direct message your agent with questions directly through the interface we call “The Portal”.

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Tour Homes

Finding a home often begins with browsing online and driving through neighborhoods to get a feel for what you want and what's out there. The next important step involves actually getting into a home. You can do that a couple of ways — through open houses and private showings.

Open Houses

If you tour a home at an open house it's important to understand that the agent holding the open will be representing the seller (or working on behalf of the seller's agent) so be careful about revealing too much if you’re seriously interested in the home. That agent will most likely pass along your comments directly to the seller. If you end up making an offer later, the revealed information could become detrimental in negotiations. Your price, terms and motivations should only be shared with an agent representing you as a client. (More on agent representation here.)

Also, you may be asked to sign in at an open house. In general, it's a good idea to just tell the seller's agent you're already working with another agent, if that's the case. (If you are working with me to find a home and are required to sign in, feel free to indicate your representation by including my name, phone number or email on the sign-in sheet.)

Private Showings

Another great way to see homes is through private showings with your real estate agent. You can set up single showings or multi-home showing tours to fit your schedule. Occasionally a 24-hour notice may be required to view a home, but I have often gotten clients in that day, or very close. If a home is vacant, a showing request might be automatically approved, requiring no prior notice. “Buyer tours” can also be created when you want to view several houses at once. Setting aside a few hours to tour a half dozen houses is efficient and can be especially helpful for making comparisons among similar properties.

Once is often not enough. Second and third showings of homes are not at all uncommon. Clients sometimes want to return with family, friends or contractors to get second opinions, cost estimates on projects, feedback, etc. If there's time to do so (with no known competing buyers), it's a good idea to take another look, just to be sure.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on variety of topics including buying and selling, market conditions, homeownership trends, local events and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Fall 2018 Housing Market Update | Twin Cities

Last summer’s frenzied market of overbidding to beat multiple offers has noticeably quieted, however, inventory around the metro remains low. Seasonal slowdowns are expected. With the advent of cooler temps, a new school year, and the holiday season, home shoppers downshift to a less aggressive search mode. But they’re still out there, on the sidelines. And new homes continue to enter the market, though at a slower rate than our traditionally fast-paced spring and summer markets. Competition for the most desirable new listings in sought-after locations is still evident with those properties selling within days when the price is right. But the rush to beat out the competition has significantly subsided. And at this time of year many buyers, distracted by holidays and winter weather, are content holding out for anticipated seasonal price-drops. But how does this compare to last fall? Is there a discernible trend? Will next spring and summer be a repeat of last? Both buyers and sellers are asking, “should I wait?”

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New fall condo listing in the Cathedral Hill neighborhood of St. Paul.

Seasonal Slowdown

As people’s priorities shift with the season the housing market slows and homes take longer to sell, theoretically favoring buyers. For home sellers, enduring an extended time on market can cause anxiety and a willingness to accept lower offers to avoid the mid-winter slump. Shoppers anticipate this downturn and those with flexibility often wait it out in hopes of getting a deal. I’ve recently talked to many potential buyers who are doing just that. After witnessing the summer drive-up in prices and stress of multiple bids, many have positioned themselves in stable temporary housing (short-term renting, house sitting, living with family, etc.) to avoid the pressure and anxiety of hyper-competitive buying. These buyers may not necessarily be waiting for a winter bargain, but rather the right home and the luxury of time for making a sound decision. It’s a smart move if you can pull it off.

One drawback to slow-season home buying, however, is lack of inventory. As the competition diminishes, so do properties. Last summer’s new listings in the 16-county Twin Cities Region peaked at 9,022, up from a mere 2,158 the winter before. No doubt the same will happen this year. The graph below clearly depicts these year-over-year seasonal dips — a predictable pattern for Minnesota markets. If you can find what you’re looking for, buying this time of year might be advantageous. If not, hold tight, the new year will bring more choices. Just be financially prepared and emotionally ready to face increased competition in a market experiencing an already scant supply of low and mid-priced homes.

Seasonal Changes in New Listings

Low Inventory

How low is low? It depends. Yes, the market has slowed from last summer but not because supply has increased, especially in the lower price ranges. Starter home supply is especially lacking with a meager 1.1 months available in the $150-200K range as of late October. A 5-6 months-supply is considered balanced, favoring neither buyer nor seller, which is currently the case in the move-up market. October data reveal a 5.9-months supply of homes priced $500,000+ across the Twin Cities Region, with 4.0 and 4.2 in Minneapolis and St. Paul, respectively.

Months Supply by Price

Includes all home types in the Twin Cities 16-county Region (single family, condo, townhouse), traditional listings (not distressed). October data derived from the regional MLS.

Changes Ahead

During the past three years we’ve experienced a steady decline in available homes for sale across the metro, tipping the balance in favor of sellers. Is that changing anytime soon? Perhaps, but slowly. Data from the past year show less of a decrease this year compared to previous years — only 1% from last October. Considering we experienced double-digit drops in the years preceding (17% then 14%), this number stands out as potentially significant. It may be signaling a trend reversal and shift toward greater balance in the market.

The months-supply metric also shows signs of leveling. This October was the same as last at 2.4 in the 16-county region for all home types, sizes and sellers (traditional and lender-mediated). Since its high point in 2008 (9.9) that number has plummeted to its low last winter (1.5) but appears now to be holding steady. We’ll see what this winter brings.

What might these changes mean for home shoppers? It’ll be good news for buyers wanting more choices. And a greater number of homes to meet demand could translate to price-dropping, or at least price-leveling in the coming year.

Number of Homes For Sale* | Twin Cites

Decline in number of homes for sale may be leveling out. Includes 16-county Twin Cities Region, all types, styles and sellers (traditional and lender). Data derived from Northstar MLS.

Selling this spring

What about current owners looking to list? Future sellers should be comforted by the inventory numbers which are still historically low. If you’re selling in the low-to-mid market, you should be okay. Location and condition matter too, however. And, despite the limited supply, home buyers’ expectations tend to be high. If you plan to list this spring or summer, start now with repair and update projects (if you haven’t already)! Most buyers expect HGTV-worthy homes that are updated and move-in ready. What does that mean? You should declutter, deep-clean and make small repairs at the very least. Neutralize your paint colors, update lights and fixtures and complete small remodeling projects if you can. Then work with a stager to add or arrange on-trend furniture and decor to match your target market. It may seem like too much in a “seller’s market” but homes that have been thoroughly prepped stand out from the competition and typically sell faster. And, the costs involved are usually recouped through a higher offer price and fewer days on market. Most buyers cannot see past clutter or disrepair when visualizing living in a space. Sellers can help them! Now is the time to start if you are planning a spring listing.

Mortgage Rates Rising

Mortgage interest rates have ticked up and many speculate further increases for the coming year. Have the recent hikes affected buyer behavior? For the most part, no. Buyers appear more focused on changing sales prices than fluctuating interest rates, for now. Why? Perhaps because rates are still historically low and people have been able to purchase the homes they desire. But if you’re thinking about buying soon (in the next year or so) consider closely the cost of another potential rate increase. Even a 1% change could drastically affect your monthly payments and amount for which you qualify. For example, payments on a $250,000 house (with 20% down) jump from $1053 to $1177 per month with a 1% rate hike, and you would end up paying an additional $44,773 in interest over the life of the loan.

You should also be aware of how increased monthly payments can affect your buying power. Fannie Mae and Freddie Mac conforming loan guidelines require certain “front-end” (mortgage-to-income) ratios — typically your monthly payment cannot exceed 28% of your income. If your monthly payment goes up with a 1% rate hike, so must your income if you wish to purchase that same $250,000 home. The consequences of rising interests rates could push you into a lower price-bracket, unless your income keeps pace.

Example: 1%↑ in Interest Rates

Estimates for a $250,000 home with 20% down ($200,000, 30-year, fixed rate mortgage)

Slow and Steady

The Twin Cities Region has experienced a steady rise in median home sale prices over the past several years. As of October the median price of traditionally-sold properties (non lender-mediated) had increased 6.8% over last (with a 5% bump the year before). With supply still lacking in the low-to-mid range, major price drops in the coming year are not anticipated. For city dwellers, St. Paul remains a more affordable option over Minneapolis with a current median sale price of $216,600 compared to $265,500 in Minneapolis.

Condo and single-family homes are on similar tracks across the Twin Cities with 5.8% and 6.0% increases, respectively. Townhouses may be in greater demand showing an 8.2% jump since last October. Keep in mind the real estate market is location-driven and what’s true in your neighborhood may not be the case in another. Even within neighborhoods, demand and price can vary block to block. Overall, however, our region appears stable despite the early chill in the air and consequent drop in market activity.

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*Homes for Sale refers to the number of properties available for sale in active status at the end of a given month. Also known as inventory.

In this this post the Twin Cities 16-county Region include the following: Anoka, Carver, Chisago, Dakota, Hennepin, Isanti, Le Sueur, Mille Lacs, Pierce (WI), Ramsey, Scott, Sherburne, Sibley, Washington, Wright and St. Croix (WI).

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on a variety of real estate related topics including buying and selling, market conditions, homeownership trends and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Should I hire a Realtor? What type of representation is available in Minnesota?

If you are buying or selling real estate in Minnesota you should know what type of agency representation is available to you as a consumer. Realtors® in Minnesota are required to talk about this with potential clients early on in any communications. If you start talking about your price, terms, or motivation with an agent, expect to be presented with a written disclosure and explanation about different ways agents can represent their clients. This is for your benefit and agents are required to share it. Feel relieved rather than pressured when getting the form — it’s a disclosure, not a contract and will equip you with valuable information to help in your process. If an agent does not present it when you think they should, ask. A good agent will be adhering to ethical standards and this initial interaction may give you insight into future communications and relationships.

To help home buyers and sellers better understand Minnesota’s agency disclosure requirement, the St. Paul Area Association of Realtors® created this quick video. Check it out to learn more!

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on a variety of real estate related topics including buying and selling, market conditions, homeownership trends and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Questions to Ask When Buying a Condo or Townhouse

Condo living has definite advantages but it can also create unexpected, and potentially unpleasant, scenarios if you jump in without doing your research.  

If you're thinking about buying a condominium or townhouse but have not yet lived in a Common Interest Community, or CIC (condo, townhouse or co-op), ask these questions before finalizing any offer:

• What's the monthly association fee and what does it cover? Which utilities are shared? Which utilities are paid for by individual units?

• How is the water use metered? Does each unit pay for individual usage? Or is is split evenly?

• Can heat be controlled in each unit? Or, is their a central thermostat?

• Are pets allowed? If yes, which ones and how many? Are there weight, size or breed restrictions?

• Is the association self-managed? If yes, do the members get along? If not, who manages it and how reputable is the company?

• How much money is in the reserve account for future maintenance projects?

• What's the association's annual budget?

• Who is on the board? Try to talk to a board member directly.

• Do the other owners have the right of first refusal in the sale of other units?

• Is there additional storage for each unit? Where? Does it cost extra?

• Are there any pending building repair/improvement projects? If yes, what? How much is proposed? Are costs split evenly among units? What other future projects have been discussed?

• Is smoking prohibited? Do any of the residents smoke?

• How sound proof is the building? Can you hear noise in other units?

• Who lives in the other units? For how long? Are they owner-occupied?

• Are long-term rentals allowed? If yes, how many? What percentage can be rented at any one time?

• Are short-term rentals (like Airbnb) allowed? If yes, are any units currently being used as Airbnb rentals?

• Where is the common space? Who maintains it?

• If there's shared laundry, what's the system for using it?

• If there are unassigned off-street parking spaces, what's the system for using them?

• Can I make changes to my unit? What, if anything, is restricted?

You may not get answers to all of these questions but at least be mindful of your living space needs and aware of any restrictions that may affect them. 

Statutory Rescission Period

When making an offer on any CIC (Common Interest Community) governed by a Minnesota HOA (Home Owner Association) you have a 10-day period to view all association documents and cancel the offer without penalty. This recession period begins once the last of the docs* has been received (agents should be working diligently to get them delivered as quickly as possible.) Hiring an attorney to review the documents is always a good idea!

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* Minnesota requires sellers to provide the following HOA documents: 

• Declaration

• Articles of incorporation

• Bylaws

• Rules and regulations

• Amendments or supplemental declarations

• Organization and operating documents, including budgets and financials

• Resale disclosure certificate

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on a variety of real estate related topics including buying and selling, market conditions, homeownership trends and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.

Single Women: Top 5 Reasons to Buy a Home

Single women, the second largest group of home buyers behind married couples, account for nearly 18% of all buyers. Last year they far outnumbered single men who made up just 7%, according to the most recent NAR Profile of Home Buyers and Sellers. 

I've helped several single women purchase homes and have been there myself — I bought my first condo alone nearly 15 years ago. I wanted to know what motivated other women so reached out to friends, family and former clients to find out why they decided to buy solo and what advice they would give others. Read the complete Q&A blog post here. Read their top 5 motivations for buying here:

Top 5 Reasons Women Choose to Buy

1. Make a Smart Financial Move

A top reason cited by women looking to buy is financial. Specifically, they state a desire to "stop throwing away money on rent" and to build equity in asset ownership. Tax breaks benefiting home owners are also motivating. 

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2. Get Away from Apartment Life

The constraints and inconveniences of renting in a shared space can be trying. Complaints of apartment life include concerns over noisy neighbors, shared walls, lack of privacy and limited parking. Owning a home, especially a single-family house, affords more control over noise and privacy with less worry over bothering the neighbors (or them bothering you). It can also mean having predictable and secure parking options — convenient for having guests, navigating snow emergencies and safer when parking alone at night. 

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3. Enjoy Personal Outdoor Space

Many women desire outdoor space — a private yard, a place to garden, or enough room for a  dog. Though the city parks and paths provide plenty of options, they're never quite the same as having an outdoor sanctuary all your own. 

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4. Make Your Own Design Decisions

Wanting the freedom to paint, decorate and make changes without having to ask permission is a common theme for home buyers. It can be frustrating to live within the confines of a rented space for this reason and others. Owning allows you to paint, replace, knock down and build out as you wish which can be quite satisfying. And, the money and time spent improving your space is usually not wasted — smart improvements add value to recoup when it's time to sell.

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5. Have Something to Call Your Own

Cultivating the feeling of ownership and accomplishment brings pride, confidence and joy. It just feels good to have a place of your own. Whether it comes from reaching your goal or creating a space that's uniquely yours, the positive sentiment can often be reason enough for wanting to buy a home.

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Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on a variety of real estate related topics including buying and selling, market conditions, homeownership trends and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.