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. 

Should You Move Out Before Listing?

Is it best to move out before listing a home for sale?

Good question! I get asked this frequently and my answer depends on my client’s individual situation. The process of preparing a home for sale can feel overwhelming at first, especially if you have years or decades of accumulated stuff to sort, pack and move. If this is the case, I always suggest planning far in advance — several months or even a year or more depending on the size of your move and work/life obligations. Once you begin planning, you may start to wonder how far you should go in paring down. Is it better to move out all the way before listing? It depends. Moving out prior to listing may not be realistic for many homesellers. Below are common considerations and potential scenarios for helping you decide what’s best for you.

Stay Put

When deciding on what to purge and pack, consider who will be walking through your home, and when. Once your property is listed for sale, buyers and their agents will begin touring it, typically through private showings. Buyers’ agents will request showings and you as the seller may approve or deny their requests. Of course you will want as many potential buyers as possible to visit so being flexible and accommodating is ideal. Buyers and their agents expect to tour homes without sellers present. Doing so gives them privacy and space to talk freely among themselves and to imagine possibilities for making space their own. So if you plan to live in your home while it’s listed for sale, plan to vacate during showing times which typically last 30-60 minutes. 

Before each showing, I recommend cleaning and straightening as much as possible. Aim for matching the condition depicted in the listing photos — no dirty dishes, wet towels on bathroom floors, unmade beds, etc. Since most people don’t live in picture perfect spaces this can sometimes be a challenge, especially if kids and/or pets are involved. If you choose to stay put, setting household expectations and staying organized will help. 

Vacation or Staycation

The flurry of buyer activity usually happens right out of the gate. The first several days on the market often generate the most traffic, especially in an active market (think spring in Minnesota!) If you plan to stay in your home but want to avoid the new listing buzz, consider a vacation or staycation. I often see sellers plan weekend trips around the list date to avoid the initial deluge of showing requests. 

Partial Move

Moving out, or mostly out, ahead of time can help alleviate the disruption and displacement during showing hours. If you plan to move out but have flexibility with furnishings, consider a partial move, leaving key pieces and moving the rest. Ideally, a marketed property should feel like a home, with at least some furnishings. Vacant rooms just aren’t cozy. They also leave little for a photographer to shoot. Furniture creates focal points which in turn produce more captivating images. And with 100% of buyers beginning their search online, attention-grabbing images are a must.

Partial Stage

If a partial move-out is possible, consider hiring a professional stager to fill in the rest. Depending on the condition and style of your furniture, you may want to hold off on moving larger items. Anchor pieces like beds, couches and dining sets help buyers envision scale and how a space may be used. These larger pieces are part of the equation; pillows, throws, plants, art, etc. make up the rest. Many stagers offer some type of hybrid service to fill in the gaps using their own inventory while working with a seller’s existing furniture. When doing so, they can help you decide which pieces to keep and incorporate as they work to target your likely buyers. Keep in mind, staging is strategic marketing, not just decorating. A good stager will understand the market and work to attract a specific pool of buyers based on your price point, location and home style.

Partially Staged: Seller’s dining room set combined with stager’s art, plants, etc.

Full Move

If your timeline necessitates a full move-out you could either photograph your home as a vacant property or consider full staging. Vacant room photos are not as eye-catching of course but sometimes this is the only viable option. 

Stage

If you opt for staging a vacant home, you have choices. Vacant home staging most often includes furnishing just the main living area, primary bedroom, kitchen and bathrooms, but covering the whole-house is always an option for an additional cost. Staging services typically include a set-up fee and a couple of months rental. Fee structures vary, as do style and quality of furniture, so it’s worth shopping around for the right fit.

A less common practice is virtually staging. It can be a more cost-effective way to create compelling photos but doesn’t necessarily enhance the buyers’ walkthrough experience. 

View fullsize

Vacant home BEFORE staging

Vacant home AFTER staging

Clear Clutter

When planning your move, consider the end goal — closing day, or date of possession. You will need to be completely out of your home by then. Unless otherwise negotiated with the buyers, this means removal of all personal belongings and all debris. 

A closing period is typically 30-45 days from the date the offer is signed and accepted and cash offers can close even sooner, within a week or two. So once your home hits the market, time could potentially fly. I recommend doing as much purging and moving as possible before listing — you’ll have to clean out your closets eventually, might as well do it before! Less is always more for buyers who will peek in every nook and cranny.

Sometimes a second set of eyes is helpful for seeing what needs clearing or keeping. I often do room-by-room walkthroughs with clients at the beginning stages to help determine which items to eliminate, especially larger pieces that may need to be donated or sold. In many cases, sellers were planning to get rid of stuff anyway and appreciate a green light to begin purging. Professional stagers work in a similar way. They create punch lists for sellers that include suggestions for specific paint colors, light fixture updates, and more.

Scenarios for selling are as varied as the homes and lives of the people living in them. Once you’ve made the decision to move, don’t be afraid to ask for assistance — family, friends and professionals can be invaluable for smoothing out the process. We are here to help. Mobilizing to sell and move may seem daunting but it is certainly doable. I continue to be amazed by the effort, energy and perseverance of my clients who have made it happen.

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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. 

How to Prep Your Home to Sell: Top 10 Tasks

1. Deep Cleaning

Ensure your home is spotless. Clean carpets, wash windows, and scrub floors. Pay attention to often overlooked areas such as baseboards, light fixtures, and grout lines. A clean and fresh-smelling home makes a positive impression. Be sure to address odors as well. Eliminate any unpleasant smells by deep cleaning carpets and upholstery. Keep the home well-ventilated during showings. Avoid using air fresheners or scented candles.

3. Declutter and Depersonalize

Remove excess belongings to make your home appear more spacious and allow potential buyers to envision themselves in the space. Pack away personal items like family photos and keepsakes. Clear countertops, closets, and storage areas to showcase the available space.

4. Repairs and Maintenance

Fix any visible issues such as leaky faucets, broken tiles, cracked walls or stained ceilings. Ensure that all systems and appliances are in good working condition. Consider replacing appliances that are nearing end of life.

2. Enhance Curb Appeal

First impressions matter! Enhance your home's exterior by mowing the lawn, trimming hedges, planting flowers, and adding fresh mulch. In winter, be sure sidewalks and driveway are clear of snow. Consider repainting the front door, updating hardware and adding new house numbers.

5. Neutralize and Paint

Consider repainting rooms with neutral colors to create a blank canvas for potential buyers. Neutral tones appeal to a broader range of people and make it easier for them to imagine their furniture and belongings in the space. Though a pop of color on an accent wall works well in photos and for creating dimension!

6. Maximize Natural Light

Open curtains and blinds to allow natural light to fill the rooms. Clean windows inside and out to ensure they are spotless and let in as much light as possible.

7. Stage Your Home

Arrange furniture and decor to highlight the home's best features and create an inviting atmosphere. I strongly recommend hiring a professional stager to help you with this! Their approach is to market to specific buyers in your area at your price point. Stagers can also offer design recommendations for paint colors, refreshed lighting, bath fixtures, flooring, and much more!

8. Refresh Kitchen & Bathrooms

The kitchen is a crucial area for buyers. Update outdated fixtures, repair or replace damaged cabinets, and consider upgrading appliances if needed. Clean and repair any issues in the bathrooms. Replace outdated fixtures, re-caulk bathtubs and showers, and add fresh towels and accessories.

9. Update Lighting

Adequate, modern lighting enhances the appeal of a home. Replace outdated or broken light fixtures and ceiling fans, and consider using energy-efficient bulbs (warm white!) to save on energy costs.

10. Set an Appropriate Price

Work with a real estate agent to determine a competitive and realistic listing price based on market trends, location, and the condition of your home. Pricing your home accurately is crucial for attracting potential buyers. Savvy buyers will know if your home is overpriced and will most likely wait out a price drop. As with most “retail pricing”, shoppers wait for the sale. But once this happens buyers may start to wonder, “what’s wrong with it?”, especially in a hot seller’s market. Better to hit the pricing sweet spot when first entering the market than to lower it later on.

Remember, the specific requirements for preparing a home for sale may vary depending on its condition, location, and target market. It's always a good idea to consult with a local real estate professional for personalized advice tailored to your situation.

Simple House Projects that Boost Livability, and Appeal to Buyers

If you’re staying safe at home, now might be good time to start knocking house projects off your list, especially if you plan to sell in the near future. After a long winter of inside living, the list of possible tasks can seem overwhelming. How do you prioritize? Here’s a list of fairly simple and inexpensive projects that will make your home more appealing to buyers in the event of a future sale. At the very least, you might enjoy the small changes and improvements to your space during your days and weeks spent quarantining.

Organize Your Entry

Outdoor gear tends to pile up near main entry points, especially during colder months. Take time to clean it up and create system for organizing coats, hat, bags and shoes, ideally out of sight. Decorative hooks, baskets, bins or cubbies can work wonders. If you have a coat closet that needs reorganizing, even better. Clean it out and keep it organized. This is something you could do in a weekend. It’s an easy and inexpensive way to boost appeal and create a positive first impression.

Purge and Declutter Closets, Drawers, Shelves and Cabinets

This always takes longer than you think. Start now, go room by room, closet by closet, drawer by drawer…or whatever system works best for you.

Replace, Fix, Dispose of Broken Appliances

Broken dishwasher? Replace or fix it. You should have functioning appliances at the very least when selling a home. Old broken freezer in the basement? Remove it. Most buyers don’t want to inherit old appliances they’ll have to pay to dispose of. They may make removal a condition of the sale prior to closing so you might as well do it now. And if a new one is needed, at least you’ll have time to enjoy it. Assess your appliance situation and make improvements if needed.

Fix Leaks or Broken Faucets

This might help your water bill too so you might as well do it now while you’re still living there. If you have a leaky faucet or a running toilet plan on a future buyer asking for this repair. If you have loose fitting ones, tighten or replace them now.

Update Cabinet Hardware (Kitchen + Bath Pulls, Knobs, etc.)

This is a cheap way to refresh cabinets. Modernizing hardware, even on outdated cabinets, can make a big difference. Consider coordinating with updated faucets to create unity.

Clean Out the Garage

Here’s a good spring project. Decluttering your house should be priority when getting ready to sell, but tackle the garage too if you have time.

Repair Holes, Cracks, Water Damage in Walls and Ceilings

Filling holes left from old wall art is cheap and well worth your time. It may require paint touch-ups or even new coats though. Do that too if you can.

Seeing spots from past water damage raises concern for some buyers. Take care to repair them but know you’ll need to disclose in writing any known damage.

Finish Incomplete Paint or Remodel Projects

You may have started a project, stopped it eons ago, and forgotten about it completely. You might not notice it, but a buyer will. Most new owners don’t want to inherit someone else’s half-completed project. Do what you can to finish it off while you have the time.

Cover or Paint Radiators

I love older homes and hot water heat but radiators can become dust-collecting eye-sores if neglected. At the very least, clean them. If time and budget allow, consider getting custom-made covers or repainting them.

Covers

Chris Seidl is a Minneapolis-based carpenter who creates custom covers for just about any space. This spring he designed, built, painted and installed a custom cover for my kitchen — I highly recommend! This is a great way to add extra storage too, which any potential buyer will appreciate.

Painting

If radiator covers aren’t in your budget, you may want to just clean and paint them. Color and paint type matter when finishing radiators so I recommend consulting with experts at a local paint store when selecting products.

Chris Seidl of Craftsman Radiator Covers, a Minneapolis-based one-man-show who designs and installs custom radiator covers

Fix Missing Trim, Thresholds, Broken Doors, etc.

Again, like abandoned remodel projects, these can be easily overlooked — you just stop seeing them. Buyers will take note, and may also wonder, “What else has been neglected?

Refresh Outlets and Cover Plates

If you have old, dirty, or mismatched plate covers in rooms, replace them with new matching ones. It’s super cheap, just takes a little time. You also might want to consider grounding outlets and putting GFCIs in all the right places, if you haven’t already. Though these are common inspection items, they’re usually not deal breakers for buyers.

Replace or Remove Broken (or Outdated) Window Coverings and Blinds

Think “less is more” when considering your window treatments. People love natural light so let it in whenever possible. Replace broken blinds and shades, or remove them altogether if privacy isn’t a factor. Minimalist coverings are more in vogue. Think plain, airy and simple designs, textures and colors.

Wash Your Windows

Thoroughly clean all windows, inside and out. If you’ve never done it, or if it has been a while, you will be amazed, especially after a Minnesota winter or two. It will make your whole house will feel cleaner. It can be a daunting task depending on your home size but plenty of companies will do it for you. They do schedule the service colder months but when temperatures dip below 32 anti-freezing product will be added, diminishing the result.

Replace Old Rugs and Welcome Mats

One very simple project is to get rid of old muddied rugs and welcome mats and replace with new. Clean points of entries are key to creating positive first impressions, and door mats and rugs are usually the first things to come into view when buyers walk into homes. You might want to do this closer to listing though to keep the new ones clean. You could just buy now them and have them ready. One more thing off your list!

Add or Transplant House Plants

Adding plants to your rooms is a simple and inexpensive way to warm up your space, especially in colder months. House plants add life and can be used as pops of color. Use a floor plant in place of furniture or knick knacks to fill in empty spaces (in big corners, on bookcases, etc.) Add to a bathroom to create a spa-like feel or use as simple centerpieces for a kitchen, dining or coffee table.

Be sure to keep plants looking healthy — trim dead leaves and follow instructions for keeping them alive! If you’re not a plant person you might want to wait until closer to listing before taking on the task, or pick hardy varieties that demand little attention. Succulents and cacti are easy options. They’re also trendy right now and can add a modern, up-to-date accent that complements most home styles.

Deep Clean Everything, Even the Fridge

This may not be so quick and simple, depending on your starting point, but it is the most important, and it’s free (or can be). So if there’s anything that needs deep cleaning (refrigerator shelves, bathtub & shower, stovetop, hall closet, garage, etc.) might as well begin now.

When cleaning spaces it’s also best to clean out. Start purging and getting rid of unwanted stuff sooner than later. This part can be overwhelming so go bit by bit and celebrate small completions. Clean and tidy kitchens and baths are most noticeable to buyers so you may want to start there.

Fix Lights and Replace Bulbs

Natural light is always best but sometimes showings happen after sunset. There’s a good chance buyers will be viewing your home at night, especially in winter months. Pleasant lighting will add to a buyer’s overall impression of a space. Take a close look at your lighting situation and make the simple additions, repairs or replacements needed to enhance it.

Check all overhead fixtures and sconces for burned out bulbs. Replace where needed and make sure to match bulb strength and color. For example, if you have a 3-bulb bath fixture be sure all three have the same type bulb. And if a fixture is broken, now is a good time to replace it.

Soft, warm light is preferred for creating a cozy atmosphere. Florescent or blue-white bulbs feel cold and harsh. Lamplight also creates a more comforting, homey feel, especially compared to flush mount overhead lights. Add lamps (with warm bulbs) to rooms where space allows. Thinks bedside tables, poorly-lit corners and even bathrooms or hallway console tables. Dimmers on pendants and chandeliers are also handy for creating a cozy ambience. Again, this is an easy, quick way to increase appeal that could be done in a weekend.

Spruce Up Your Entry with New House Numbers

This simple change can add instant style and curb appeal. Make sure the font matches your home’s style.

Paint or Touch up Exterior Trim, Siding and Doors

If you have flaking paint, scrape and repaint if possible. If your exterior door needs a refresh, paint it. A pop of color and an inviting entry create curb appeal and positive first impressions. I recommend a statement color in keeping with the style of your home.

Though April is usually too early in Minnesota for outdoor painting, it may be a good time to start planning and scheduling a future project. Martey Jakel, local St. Paul-based painter and owner of Showcase Home Painting takes outdoor jobs all spring, summer and fall, as long as paint can properly adhere. Most paint can be applied with temps and drying time as low as the high 30’s (40 to be safe). Martey recommends doubling the manufacture’s drying time at these temps to ensure adhesion. He also recommends checking window sills and seals where built-up moisture can cause flaking and rot. Caulking and priming these trouble spots before winter can be well worth your time and effort. If you’re not sure how to identify what needs what, call a paint professional. You’ll have better luck scheduling them this time of year as construction and repair projects slow with seasonal changes.

Clean Gutters and Repair Downspouts

Use warmer, rain-free days to do a spring cleaning of gutters. Repair and reposition broken or leaking downspouts to divert rainwater and melting snow.

Repair Rotting Exterior Trim Pieces and Decking

If you have rotting boards, replace them, especially floor boards that can create hazards or let in moisture. If weather permits, paint or stain replaced parts. If you need to hire someone to do the repairs, start calling now to get scheduled. Contractors’ calendars fill up fast this time of year.

Add Mulch to Gardens and Landscape

Get ahead of the weeds and spruce up your yard by laying mulch early spring. Avoid bags of plastic by using recycled wood from around the Twin Cities. Many counties and cities offer free wood chips/mulch for pick-up. Ramsey County and the City of Minneapolis have several pick-up sites around the metro, for example. Check your city/county websites for availability, locations and hours.

Get Help

Your home’s condition and age matter when prioritizing your to-do list. These projects may be totally irrelevant or just a starting point, it all depends. If you are considering selling, I recommend getting help creating a customized list before you begin. Walking through your house with a second set of eyes is often what’s needed to zero in on the best use of your time and money. I do this often with clients, sometimes long before listing. If you need help figuring out where to start, call or message me for a consultation. We can even schedule a virtual walk-through to practice safe distancing — whatever works for you.

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. 

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.

5 Quick and Easy Ways to Boost Your Home’s Appeal

If you’re thinking about selling soon you’ll want to take a close look at your home’s condition and determine what projects, if any, will need to be done before marketing it. Some projects can feel overwhelming and may or may not be necessary (meeting with a real estate professional is a good way to prioritize that list.)

Details matter to home buyers but can easily be overlooked by sellers, especially if you’ve been in the home a while. It’s easy to just stop seeing what is always in view. Know that buyer perception will be affected by small, seemingly insignificant improvements. Here’s a list of five simple projects you could do in a weekend to start boosting your home’s appeal for those future buyers.

Organize Boot, Bag & Coat Storage

Winter gear tends to pile up over the season, especially near main entry points. If you list during this time of year, you’ll want to address the mess. Walking into mound of jackets and footwear is a distraction for buyers at the very least, and can easily can create a less-than-ideal first impression for anyone touring your home. Take time to clean it up and create system for organizing coats, hat, bags and shoes, ideally out of sight. Decorative hooks, baskets, bins or cubbies can work wonders. If you have a coat closet that needs reorganizing, even better. Clean it out and keep it organized. This is something you could do in a weekend. It’s an easy and inexpensive way to boost appeal and create a positive first impression for buyers.

Add Mood Lighting

Natural light is always best but this time of year many showings happen after sunset. There’s a good chance buyers will be viewing your home at night, and the light illuminating the space will add to their overall impression. Take a close look at your lighting situation and make the simple additions, repairs or replacements needed to enhance it.

Check all overhead fixtures and sconces for burned out bulbs. Replace where needed and make sure to match bulb strength and color. For example, if you have a 3-bulb bath fixture be sure all three have the same type bulb. And if a fixture is broken, now is a good time to replace it.

Soft, warm light is preferred for creating a cozy atmosphere. Florescent or blue-white bulbs feel cold and harsh. Lamplight also creates a more comforting, homey feel, especially compared to flush mount overhead lights. Add lamps (with warm bulbs) to rooms where space allows. Thinks bedside tables, poorly-lit corners and even bathrooms or hallway console tables. Dimmers on pendants and chandeliers are also handy for creating a cozy ambience. Again, this is an easy, quick way to increase appeal that could be done in a weekend.

Replace Worn Rugs & Welcome Mats

An even easier project is to get rid of old muddied rugs and welcome mats and replace with new. Clean points of entries are key to creating positive first impressions, and door mats and rugs are usually the first things to come into view. You might want to do this closer to listing though to keep the new ones clean. You could just buy now them and have them ready. One more thing off your list!

Add Potted Plants

Adding plants to your rooms is a simple and inexpensive way to warm up your space, especially in colder months. House plants add life and can be used as pops of color. Use a floor plant in place of furniture or knick knacks to fill in empty spaces (in big corners, on bookcases, etc.) Add to a bathroom to create a spa-like feel or use as simple centerpieces for a kitchen, dining or coffee table.

Be sure to keep plants looking healthy — trim dead leaves and follow instructions for keeping them alive! If you’re not a plant person you might want to wait until closer to listing before taking on the task. Or pick hardy varieties that demand little attention. Succulents and cacti are easy options. They’re also trendy right now and can add a modern, up-to-date accent that complements most home styles.

Clean!

This may not be as quick and simple, depending on your starting point, but it is the most important, and it’s free (or can be). So if there’s anything that needs deep cleaning (refrigerator shelves, bathtub & shower, stovetop, hall closet, garage, etc.) might as well begin now.

When cleaning spaces it’s also best to clean out. Start purging and getting rid of unwanted stuff sooner than later. This part can be overwhelming so go bit by bit and celebrate small completions. Clean kitchens and baths are most noticeable to buyers so you may want to start there.

As the weather warms consider scheduling window washers to clean all windows inside and out (or do it yourself). This will make the whole house seem cleaner. If you’ve never done it, or if it has been a while, you will be amazed, especially after a Minnesota winter or two. And if hiring whole-house cleaners is in your budget, do it. Try to schedule it as close to listing time as possible though.

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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 Credits

Succulent: avery klein on Unsplash | Rugs: Lida Sahafzadeh on Unsplash

Welcome mat: Jon Tyson on Unsplash | Sink: pascalhelmer on Pixaby

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)

What can you do now if you're planning to sell this spring?

Planning to list your home this spring? It may seem far off, with heavy snow yet to hit, but the early spring market will be here in no time. In fact, it can start as early as February depending on factors like weather, inventory and motivation.

If you have a 3-month window to prep, what projects should you start now? I’ve put together a list of common tasks sellers often tackle when preparing homes for the market. It’s not exhaustive and may be way more than needed (every situation is unique), but take a look and decide what makes sense for you.

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Seller’s Fall & Winter To-do List:

Attend to the pre-sale inspection

Currently 16 cities around the metro require some type of inspection prior to listing a home for sale. Sometimes called a TISH, or Truth-in-Sale-of-Housing inspection, they are typically good for 1-2 years. Some cities require repairs based on items found in the TISH. Others just want the report available to potential buyers. You could use this time to address any items that might be flagged in the inspection. Check with your city for specific items covered.

Inspect roof & make needed repairs

Walk the roof, or have a professional do it for you. Many roofing companies schedule regular seasonal check-ups to inspect for built-up debris, compromised caulking around chimneys, and more.

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Spruce up your entry with new house numbers

This simple change can add instant style and curb appeal. Make sure the font matches your home’s style.

Insulate

With winter comes the possibility of ice dams. In past years they’ve created major headaches for early spring sellers. You can work to prevent them by getting your home assessed and taking preventative action while you can. Check for adequate attic insulation and ventilation. More importantly, seal your attic bypasses — those gaps where warm air from can easily escape into your attic. Think plumbing vents, bath fans, electrical conduits, can lights, etc.

Close out permits

Check with your city for outstanding permits and get them closed. This may take time if inspections are required so it’s best to get the process rolling.

Purge & declutter

This always takes longer than you think. Start now, go room by room, closet by closet, drawer by drawer…or whatever system works best for you!

Replace/fix/dispose of broken appliances

Broken dishwasher? Replace or fix it this winter. You should have functioning appliances at the very least. Old broken freezer in the basement? Remove it. Most buyers don’t want to inherit old appliances that are costly to remove. They may make removal a condition of the sale prior to closing so you might as well do it now. And if a new one is needed, at least you’ll have time to enjoy it. Assess your appliance situation and make improvements if needed.

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Fix leaks or broken faucets

This might help your water bill too so you might as well do it now while you’re still living there. If you have a leaky faucet, plan on a future buyer asking for this repair. If you have loose fitting ones, tighten or replace them this winter.

Repair holes, cracks & water damage in walls and ceilings

Filling holes left from old wall art is cheap and well worth your time. It may require paint touch-ups or even new coats though. Do that too if you can.

Seeing spots from past water damage raises concern for some buyers. Take care to repair them but know you’ll need to disclose in writing any known damage.

Paint the interior

Neutralize your room colors as needed (soft, warm grays, whites and creams are safe choices.) Or use existing neutral colors to refresh scuffed up walls and trim. New (and carefully applied) paint is an inexpensive and highly effective way to freshen your space. If you don’t have the time or energy, winter is a good time to hire a professional — they’re not as busy so easier to schedule.

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Update light fixtures

Take a close look at your light fixtures. Replace anything broken and outdated, especially in highly visible areas (think dining room, bathrooms, kitchen pendants, etc.)

Update cabinet hardware (kitchen & bath pulls, knobs, etc.)

This is a cheap cabinet refresh. Modernizing hardware, even on outdated cabinets, can make a big difference.

Refresh outlets & cover plates

If you have old, dirty, or mismatched plate covers in rooms, replace them with new matching ones. It’s super cheap, just takes a little time. You also might want to consider grounding outlets and putting GFCIs in all the right places, if you haven’t already. Though these are common inspection items, they’re usually not deal breakers for buyers.

Clean out the garage

Here’s a good fall project. Decluttering your house should take precedence, but do the garage too if you have time.

Finish incomplete paint or remodel projects

You may have started a project, stopped it eons ago, and have totally forgotten about it. You might not notice it, but a buyer will. Most new owners don’t want to inherit someone else’s half-completed project. Do what you can to finish it off this winter.

Fix missing trim, thresholds, broken doors, etc.

Again, like abandoned remodel projects, these can be easily overlooked — you just stop seeing them. Buyers will take note, and may also wonder, “What else has been neglected?”

Replace or remove broken (or outdated) window coverings, blinds, etc.

Think “less is more” when considering your window treatments. Buyers love natural light so let it in whenever possible. Replace broken blinds and shades, or remove them altogether if privacy isn’t a factor. Minimalist coverings are more on trend. Think plain, airy and simple designs, textures and colors.

Wash your windows

Thoroughly clean all windows, inside and out. If you’ve never done this before you’ll be amazed. Your whole house will feel cleaner! It can be a daunting task depending on your home size but plenty of companies will do it for you. Companies do schedule cleanings in winter months but once temperatures dip below 32 degrees, anti-freezing product will be added. Do it now to enjoy the benefits and knock it off your list, or clean them come spring (before photos!)

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Tile backsplashes

Tile can be a fairly inexpensive way to finish off a kitchen or bathroom space, adding an element of interest or a splash of color. If you have time and resources, consider doing small tile jobs that align with the style and era of your home.

Replace old carpet (or remove)

If your carpet is old and worn seriously consider replacing it before listing. Winter is a good time to shop and schedule this. If it’s newer and looking good, get it professionally cleaned closer to your listing date (you’ll want it as clean as possible when showing off your house.) If you have hardwood floors under the carpet, expose it — buyers value original wood, especially if it’s well preserved.

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Weather permitting:

Paint or touch-up exterior trim, siding & doors

If you have flaking paint, scrape and repaint if possible. If your exterior door needs a refresh, paint it. A pop of color and an inviting entry create curb appeal and positive first impressions. I recommend a statement color in keeping with the style of your home.

Though it’s too late for a whole-house paint job, there may still be time to sneak in smaller projects, weather permitting. Caulking and priming these trouble spots before winter can be well worth your time and effort. If you’re not sure how to identify what needs what, call a paint professional. You’ll have better luck scheduling them this time of year as construction and repair projects slow with seasonal changes.

Clean gutters & repair downspouts

If it’s not too late, use warmer, snow-free days to do a final leaf cleaning of gutters. Repair and reposition broken or leaking downspouts to divert thawing snow come spring.

Repair rotting exterior trim pieces and decking

If you have rotting boards, replace them, especially floor boards that can create hazards or let moisture in. If weather permits, paint or stain replaced parts.

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Get help

Your home’s condition and age matter when prioritizing your to-do list. These projects may be totally irrelevant or just a starting point, it all depends. I recommend getting help creating a customized list before you start winter projects. Walking through your house with a second set of eyes is often what’s needed to zero in on the best use of your time and money. I do this often with clients, sometimes long before listing. If you would like to talk about preparing and selling your home, feel free to reach out.

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, 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.

Want to sell this spring but feel stuck? You have options

Early Bird Gets the Worm

If I were planning to sell my home (which I someday may) I would definitely try to list it in the spring, Minnesota’s peak buying and selling season. Makes sense, right? Snow melts (we hope!), holidays pass and warmer weather makes for easier moving. And if I were planning to sell this year, I would be prepping my house today for a March listing date, April or May at the latest. Why? Because home shoppers are out now, preparing to buy and seeing little to choose from — it’s still very much a seller’s market.

New February listing...

sold in one day.

Low inventory, Little competition

The pre-spring Twin Cities housing inventory has been limited, especially in the low-to-mid price range, giving sellers of those homes a big advantage, for the moment. A similar scenario played out last year at this time then came to an abrupt and unexpected slowdown mid to late summer. After enduring fierce competition, multiple offers and lost bids, active buyers may have stepped back in exasperation, but they did not go away. They’re back and they want your house.

If you can swing it, I recommend getting ahead of other peak-season sellers by getting your home on the market as soon as you’re able. With fewer listings comes more views, more potential buyers, and most likely a faster sale. Let’s say you list in late March and accept an offer that week. Considering an average closing period takes 30-45 days, you may be wrapped up well before June, ready to enjoy the summer, or settle into your next home.

Months of Supply | Single Family Homes | Twin Cities*

5-6 months supply is considered balanced. Lower numbers favor sellers, higher numbers favor buyers. Northstar MLS data represents both new and previously-built single family homes of all sizes.

Spring prices

Historically, home sale prices in Minnesota rise with the temperature. The first graph below shows these seasonal price swings in the Twin Cities market over the past 10 years— valleys are cold weather, peaks are warm. Keep in mind, the peak prices you see for summer months reflect sales of homes that were most likely listed in the the spring. Considering number of days on market and the time it takes to close, the sales recorded in May and June are most likely those of homes listed in March and April.

The number of days on market — time between when a property is listed and when an offer is accepted — are typically fewer in the spring and summer, as shown in the second graph. In 2018, the average for days on market in the Twin Cities was lowest in July (38 days) and highest in February (69 days). Minneapolis and St. Paul’s summer averages were even lower at 32 and 27 respectively. So if timing and price matter, list your home in the spring. You’re likely to get a higher offer and spend less time on the market.

What if You’re Selling, and Buying?

Maybe you’d like to sell but are afraid or uncertain about having to buy your next house. It’s great to be the seller in a seller’s market, but what happens when you suddenly become the buyer? This is a common and very real fear. What if you list, get an offer right away and haven’t found your next home? Or maybe you do find it but feel pressure to offer more than you want because of your situation?

Many wannabe home sellers, who also need to buy, are feeling stuck for these very reasons. But know that it can work out. In the past year, during this crazy stressful market, I’ve seen many happy clients end up exactly where they want to be after taking the leap to sell. You’ll need to know your limits, stay flexible when you can, and make a plan. Below are some options for navigating the potential sell-buy scenario based on the successful maneuvers of past clients. They’re certainly worth exploring if you’re contemplating a move.

Option 1: Buy then Sell

If you can afford it, buying your next house before listing yours can be a good way to go. Start both projects simultaneously — begin searching and visiting new homes while prepping your home to sell. Enlist the help of a professional at this point because things can move fast. Prepping your home will take longer than you think so start right away. If you want it to move fast to avoid carrying the costs of two properties, do it right the first time. Act as if you’ve already found your next dream home and get going purging, repairing and cleaning, today!

Even though it’s a seller’s market at most price points, buyers still want move-in ready spaces that are HGTV-worthy. Consider staging, especially if your space is vacant or partially furnished after moving into your new place. Priced right, your home will most likely sell faster if it’s staged, and maybe even for more money. Well-appointed spaces are fun to tour and look way more eye-catching in photos. And since web appeal is the new curb appeal, your visually striking pics matter!

Option 2: Sell Rent Buy

You might consider selling your home then renting while you search for your next one. This can be a smart option if you can secure a flexible lease and don’t mind temporary housing. It will give you the luxury of time to search for the perfect house, wait out seasonal highs and feel less pressure to overbid when up against competing buyers. You can step back and take a more calculated approach.

If your rental unit doesn’t have the storage you need, consider leasing an off-site storage unit or asking family or friends with extra space to hold your stuff. Consider living with family or friends too if you have that option.

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Option 3: Buy Contingent on Selling Your Home

You can always make an offer on a property contingent on the sale of your home. That means you commit to buying the home only after your house sells and closes. This is a long shot in a hot seller’s market so don’t get your hopes up. It can happen though, and did last summer for some happy clients of mine. Under the right circumstances, a seller may accept your offer — you never know until you ask.

You’ll have a few options when going this route. The best is to already have your home on the market, under contract, and set to close when you submit the offer. Of course things can change to prevent your closing but it’s not that likely, and having secured a buyer should put the other home seller at ease.

Or, make an offer when your home is listed (and you’ve not yet received an offer) — risky for the seller of your new home who has no idea when or if that may happen. Still it’s worth a try if that’s where you are in the process.

Finally, you could submit an offer under the condition you will put your home on the market soon, specifying the listing brokerage and number of days until active. Put yourself in the shoes of these other sellers though — would you choose a contingent offer over non-contingent? Probably not, but you should know this is an option that has worked.

Option 4: Sell Contingent on Buying a Home

In this scenario you would put your home on the market then make any incoming offer contingent on you finding your next home. This typically happens in a hyper-competitive seller’s market, and a buyer may or may not agree to it. What if you can’t find that dream home? Your buyers will be anxiously waiting and watching the market as new homes enter and get snapped up — stressful. It creates more risk for them and if they need to move by a certain day it might not even be possible. But if they’re determined to get your house and are flexible, it can work.

If you are considering a move this year you should start thinking about it now, or soon! And if you have questions about the process, market conditions or anything else, please connect. It’s smart to know your options, keep up with local sales trends, and get help when needed.

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• Months of Supply: the inventory of homes for sale at the end of a given month, divided by the average monthly Pending Sales from the last 12 months. Simply put, how many months it would take for all current listings to sell at the recent rate of sales.

• Twin Cities Region: 16-county metropolitan statistical area comprised of 14 counties in Minnesota and 2 counties in Wisconsin.

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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.

Good Comps, Bad Comps: Estimating Your Home's Value

The market is always fluctuating, which means so is the value of your home. What’s it worth today? Good question, let’s figure it out. I often hear talk of using Zillow Zestimates for determining market value — I wish it were that simple. The site’s automated valuation model (AVM) technology might offer a speedy method for getting a ballpark number, but it misses so much more in the math-driven process. Determining market value is part science, but also art — it necessitates keen understanding of what local residents value along with close investigation of what is, has been, and will be available within a well-defined area.

What’s a comp?

A tedious yet more effective way to determine value is to research comparable homes, or comps, and study current trends in the local market — the closer to your home the better. Comps are homes that have recently sold or gone pending, are currently listed and not selling, or were once listed but since expired and pulled. When identifying comps, I recommend keeping your selection current. Start with those sold within the past 6 months, especially in a fast-changing market, then expand to 12 months as needed.

But what is a good comp, and what is a bad one? For the closest matches, you’ll want to consider multiple variables. Begin with the obvious like total finished square feet, location, number of bedrooms, and available garage space. Look too at home style, age, overall condition and recent updates, especially of kitchens and baths.

Location

If possible, choose properties within a half-mile radius of your home. Go beyond, up to 1 mile, if necessary but avoid crossing major roads, rivers, and other geographical barriers. If your home has shoreline, choose other waterfront properties. If it’s next to a highway or on a busy street, follow the same principle. If you know some blocks in your neighborhood are cherished more than others, consider streets best resembling yours.

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Home Features

Start with the obvious — is your home a single-family, multi-family, condo or townhouse? Next search for properties close in home size and lot size with the same number of bedrooms and baths, when possible. Match style as well. For example, if you’re selling a rambler, a 2-story foursquare will not be your best bet. Instead, find similar one-stories. If your home has a distinct architectural style, like Mid-Century Modern or Queen Anne Victorian, look for homes similar in design and pedigree.

The same goes for age. Match historic homes to other older homes. Tear downs and new builds are common in city neighborhoods but can carry a heftier price tag. A typical 80-year-old home is usually no match for new construction in terms of market value.

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Condition and Updates

Look beyond the numbers. Study photos and listing descriptions to discern the level of finish and extent of updates. (Touring a home live is better, but an unlikely option once it’s sold or under contract.) Pay particular attention to kitchens and bathrooms (pictured less often, unfortunately). Hunt for recent updates including new appliances, cabinets, counters, and fixtures.

Take note of other value-adding updates such as flooring, HVAC systems, new garage, windows, roof & siding or extensive landscaping. Read descriptions and acceptable offer terms to glean info about condition (photos can be deceiving.) For example, if it was sold “as-is” or as a distressed property it may have been in disrepair which will affect value. Finally, consider extra amenities like carriage houses, finished space above garages, and detached bonus spaces such as offices, art studios, “she sheds”, or ADUs (auxiliary dwelling units).

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Get help when needed

This type of market research and analysis is the everyday work of real estate agents. It’s what we do when working with both sellers and buyers. Preparing an accurate CMA (Comparative Market Analysis) is of course a critical step for sellers getting ready to list, but it also helps buyers zero in on a justifiable price when making an offer. Most likely your buyers, their agent and appraiser will all be analyzing comps and local market trends to determine how much your home is worth. You should be too.

It’s helpful for owners to understand which factors and forces are contributing to their homes value when preparing to sell. But digging for comp data and combing local listings can be a time-consuming pursuit. If you’re feeling overwhelmed at the thought of it, consider connecting. I’m happy to search on your behalf and pull together a comprehensive CMA to get you started.

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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.

Staging to Sell {BEFORE and AFTER}

Q & A with stager

Becca Schwartzbauer

Grey Duck Staging & Design

Last spring I worked with Becca from Grey Duck Staging & Design to sell a home that had previously sat vacant. Touching every room in the house, she completely transformed its spacious, bare rooms into cozy, livable spaces. It was a remarkable change worth sharing — check out the BEFORE & AFTER pictures below!

Whole-house transformation of a vacant home is just one end of the staging spectrum. Stagers offer a range of service levels depending on your budget and existing decor and can work wonders with homes of willing sellers starting with a simple consultation. To share more about these services and benefits, I turned to Becca for answers to commonly asked questions about staging to sell:

Q: Is staging different from decorating?

A: Staging is meant to be less taste-specific than decorating. We work with the space that’s available and chose size-appropriate furniture. I also choose inventory that is appropriate for the era of the home — textiles and fabrics — keeping the design relevant. We're trying to think about marketing to as many different buyers as possible. I’m staging for the masses and trying to think about the demographics of the neighborhood and who the buyer is going to be, whereas decorating is more about personal taste.

Bedroom & office

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After

Q: Which rooms are most important to stage? 

A: You never get the second chance at a first impression so right when you walk in, those rooms are high impact and most important because they are going to set the tone for the rest of the showing. Some of the most important rooms are the highlights of the home — if there’s a second living space, if there’s a beautiful master and en suite — those are the things we really want to highlight. It’s also important, on the other side of the coin, to stage areas that might be flex spaces or spaces that a buyer might not know what to do with. Say there’s a home with a built-in office and bookshelves already, and there’s also a flex space, maybe that room would be better as a craft room or a play area. We can imply what people could do with that because a lot of times, especially in larger homes, people are wondering and asking themselves what they’re going to do with these spaces.

Foyer, living & dining rooms, sunroom

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After

Q: If a home seller has furniture of their own, what's the best approach to staging and working with that client?

A: That’s called owner-occupied staging and it's become a big part of my business, especially in this market. I bring in my movers and we rearrange their furniture. A lot of times what people are missing are some of the softer finishes like throw pillows and blankets, lamps on side tables, the kinds of things that balance and bring symmetry to a design. I have done a lot of personal shopping and can bring in those types of fillers for sellers. It’s a less invasive thing to do. It’s someone’s home and it’s so personal.

Q: How do homeowners respond to your work? Do they see the value?

A: I’ve had sellers who have been extremely receptive and like, “Oh my gosh! Maybe we should stay! I never thought about putting the couch over there." You kind of get stuck in one particular layout. How many times do you rearrange the furniture in your own house? It’s not something people do a lot so it’s a fun way to kind of shake off the dust. The other huge part is that it helps them dissociate themselves from the home. When we start to take down family photos, maybe remove curtains to let more light in, or paint a few different rooms it helps to start that mental process.

Master Bedroom

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After

Q: What is your process when taking on a new client? 

A: I really like to meet with a new client in the space if it’s possible and ask them questions about how long they've been there, what are some of the challenges that they've had with furniture layout and what are some of the other challenges this home has given them. The more I understand them the easier my suggestions are. I can have a plan A, B and C based on how willing they’re going be. Staging is such a spatial job, I really need to be in the home to get a better understanding of the layout. Then I send them a follow-up email to recap everything we’ve discussed. I send them examples of some of the work I’ve done. It’s about numbers too so we also talk about pricing.

I’ve had a lot of success with motivated sellers who give me the creative control to get their home ready. But it’s important to have that consultation first to get a plan. Understanding how long a seller has been in the home, their reason for moving — if there was a death in the family and maybe it’s the children selling their parents’ place and it’s still furnished. There are a lot of things to consider when doing that initial consultation.

Dining room & Kitchen

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Small Bedroom

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Q: Do you think staging affects the final sale price?

A: Yes, I absolutely do. Statistically (from the National Board of Realtors) staged homes can sell up to 3-8% more than a vacant listing. The staging will pay for itself and also net the seller more than it would have otherwise. And with the way I stage, it’s not a churned out look. I think when people are hyper aware that the home is staged and vacant it might change their offer or negotiation because they know the sellers are in a different position than a normal seller. When someone sees a home that’s vacant, they might think, “Oh, they’re carrying two mortgages, they’re in a financial pitch” so that may affect their offer.

 large Bedroom

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After

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The positive effects staging has on a listed properties are many — help them visually stand out, sell faster for higher prices, get more shares in social media, and allow buyers to imagine the space as their own. If you are thinking about moving and would like to talk about the steps to get ready to list and sell, including staging, let's talk! I can walk you through the entire process, and connect you to other trusted service professionals.

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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.

How to Determine a List Price When Selling Your Home

A home seller's strategy for determining an initial list price can be a critical decision even in a seller's market. When working with clients who are preparing to sell, real estate agents can provide as much data, guidance and advice as possible but ultimately it is, and should be, up to the seller to pick the price. If you are in the process of preparing to sell, or thinking about a future move, read on. Below are three approaches to pricing that can potentially yield quite different results. It's best to consider all scenarios before making a splash in the market. 

Strategy 1: Find the Sweet Spot 

Gather recent sales data and formulate a price as close to those numbers as possible. What kind of data exactly? As an agent I gather this data for my clients using the most accurate and up-to-date resource available in our local market — the Northstar MLS database. I compile a list of comparable properties sold in the past 6 months (or fewer if possible), close in proximity, on similar streets, etc. I also look for the competition. What's currently on the market but hasn't sold yet? And, what homes are under contract waiting to close? When available, I'll also check for expired listings — homes that failed to generate real interest during their time on the market. This side-by-side comparative report, or CMA (Comparative Market Analysis) is a useful tool to begin dialing in on a target list price. In addition to comparables, or comps, I also consider inventory supplies, seasonal differences and sale price over time. I use Infosparks (an extension of the MLS) to zero in on trends in specific neighborhoods, including months supply of homes for sale and changes in median sale prices within the past year. 

The goal of finding the sweet spot is to attract exactly the right buyers who are ready, able and willing to make an offer. Buyers who have been shopping around and doing their research will recognize a fairly priced home and be willing to act in a timely manner. If they've been following the market and touring similar homes, they've probably looked at some of the same comps used to determine your price. 

Strategy 2: Less is More

Find the sweet spot then list for less. A lower-priced home catches people's attention and generates excitement. In a seller's market this is a sure way to generate multiple offers in no time, depending on location and condition. If your goal is to sell quickly, consider going in low. Doing so might actually bring in higher than expected offers.

If your home is in need of updates and repairs but you lack time, resources or motivation for getting them done, this strategy can also be a good option. Buyers' expectations are higher than you may think and they're often looking for any reason go low. For many shoppers outdated finishes and disrepair are reason enough to offer less.

Strategy 3: Retail Pricing

Find the sweet spot then list higher. Some sellers worry about leaving money on the table if they list too low. They want to "just see" if anyone will bite at a higher price, then go down later if they have to. Or, maybe they can't afford to take less, or are only willing to sell if they get a certain price. If you decide on this approach in a seller's market and are serious about selling, you should plan to revisit your strategy if nothing happens after a couple of weeks. Those weeks, especially the first week (and now days and even hours) are critical moments in the life of your listing. First impressions are created and opinions are formed. A motivated buyer might love your house yet deem it overpriced, quickly move on and end up buying another home before you lower yours. Some shoppers are just not in a position to wait out a price drop. And, if the price is eventually reduced people might start to ask, "What's wrong with it?"  If you go with this strategy, be prepared for a longer time on market. Stay flexible and open to reductions earlier than later.  

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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.

The Logistics of Listing Your Home

What exactly happens when you put your home on the market? There are plenty of online guides designed to help sellers get their homes ready to list, but what about the nuts and bolts of getting it on the market? I've had clients ask me simple questions like, "How does the sign get in the yard?" or "How will buyers get in my house?" These are excellent questions often taken for granted by real estate professionals. This post addresses the most basic, behind-the-scenes steps taken when listing a home with a Realtor. 

The Paperwork

When working with a real estate agent you'll be presented with several forms to read, understand and sign. At the very least, expect the following:

(There may be others depending on the type of property or type of sale. Condos/townhomes, for example, will have additional requirements pertaining to association documents.) 

Agency Relationships in Real Estate Transactions

• A disclosure explaining the types of agency representation available to you in Minnesota. Meant to inform and protect consumers.

Seller's Property Disclosure Statement

• A multi-page form filled out by sellers disclosing all known material facts about the property. Required in Minnesota. An alternative form (waiver) could also be used.

Listing Agreement

• A contract between home seller and listing brokerage outlining the terms of the listing including responsibilities of each party, commission and duration.

MLS Listing Input Form

• Lists all data about the property, authorizes the brokerage to provide the regional MLS with the data and set terms for internet display.

Certification to Withhold from MLS

• An optional form used to keep the listing off the MLS. Typically used short-term in a "coming-soon" situation or while preparing to list.

Addendum: Disclosure of Lead-based Paint

• For properties built prior to 1978, a disclosure of any known lead-based paint. Required in Minnesota.

Coming Soon Listing Authorization Form

• Optional if you would like the listing pre-marketed through through the MLS for a limited time until it's ready for showings. Seller signature required for MLS “coming soon” status.

Measuring

Before entering data into the MLS, your agent will need to measure your home to verify room dimensions, foundation size and total finished square feet. This could take an hour or more depending on the size of your house. Tax records and any past MLS listings detailing measurement information may also be used for comparison. Your agent might also work with a photographer who creates floor plans with dimensions and square footage. 

Staging

Optional but highly recommended, staging can range from full-service professional staging (filling a vacant house, for example) to minor adjustments using your own decor. Prices and terms vary so shop around. If your home is already furnished, one option is to pay for a 2-hour consultation with a stager to generate a "to-do" list for decluttering, furniture placement, fixture updates or even paint color selection. The going rate for this type of service is about $200-$250. If your home is partially or mostly vacant, you may want to get a bid for adding furniture. Again, pricing and terms vary by stager.

Keep in mind, stagers work more like merchandisers than decorators. Their goals are to figure out who will be shopping for your home and make design choices to target those buyers. They highlight the most attractive features of your home while minimizing less desirable ones. Stagers also work to make your home more photogenic. Web appeal is the new curb appeal so having striking photos that catch people's attention is key to successful online marketing. Skilled stagers understand what looks good in photos and will help you select or position furniture and decor to maximize the effect.

Taking Photos

Once your home is decluttered, cleaned and staged, it's time for photos. Your agent should take high-quality photos for the MLS and any other marketing outlets. I hire a professional photographer who also offers 3D tours, and use drone photography when appropriate. Typically this service is paid for by the agent who will work with the homeowner and photographer to schedule a time to shoot. Plan on a 2-3 hours session, depending on the size of your home. You need not be present during the shoot. The outside shot of your home should match the current season, so I try to schedule photos as close to the live listing date as possible.

Hanging a Lockbox

Your agent will hang a lockbox on or near your door to allow other real estate agents, inspectors and appraisers to access your home when you're not present. Plan on providing extra house keys for the lockbox. The box will either be a manual combination or electronic device. The electronic (or Supra iBOX) version uses bluetooth technology and can only be used by Supra key subscribers using the smart phone app to communicate with the iBox. Each opening is recorded in real time so your agent can view who is accessing the key and when via email notification. 

Installing the Sign 

The yard sign is your agent's responsibility. The process can take 3-5 days to install from order date. Expect Gopher State One Call to stop by first, marking any underground utilities before the hole is dug and post installed. After closing, your agent contacts the company for removal.

Scheduling Showings + ShowingTime

Listed properties are typically shown by a buyer's agent who requests a time to tour. In this region, the requests are usually made through a third-party site called ShowingTime. The ShowingTime request can be sent via text, email or phone call to anyone, depending on how it's set up. If the home is occupied, it makes sense to have the occupants (whether they be owners or renters) approve or deny access based on their schedules. If it's vacant or unoccupied for a length of time, ShowingTime has a convenient "go-and-show" option granting instant approval. 

Customize settings

When listing a property, I work with the home sellers to customize all ShowingTime settings before going live. It's important to know who would like to get notified and how, and what the back-up plan is if a request goes unnoticed. I add myself to the list then watch over the incoming requests to make sure they are being approved in a timely manner. Once a showing is approved, the buyer's agent receives an approval notification with access information (lockbox code, etc.) along with any specific instructions (remove shoes, turn off lights, etc.) Showing are typically scheduled for one hour but duration times can be tweaked in the app. 

Get Feedback

After the showing, a feedback request form is automatically sent to the buyer's agent. Listing agents can customize this form to ask specific questions of buyers and their agents, or use the default. Ask your agent to make changes to the form if you're seeking specific input from buyers. The feedback is meant to be shared with homeowners and can be emailed individually as it's received and/or compiled in weekly reports. Home sellers have the option of downloading the ShowingTime app to view feedback and manage showing requests. If you're comfortable with smart phone technology, the app can be useful tool. If not, text or email work just fine. Getting feedback is an important part of the showing process but can sometimes require thick skin. Be prepared for opinions that may differ from yours and ask your agent to follow up with phone calls to get more insight if necessary. 

Learn More

If you'd like to learn more about listing your home, let's connect! It's smart to ask questions and I'm happy to provide answers and support. My job is to make the selling process, which can seem overwhelming at first, as simple as possible. 

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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.