Tami and Steve's I-94 Minnesota Real Estate Blog: January 2010

Some days, social networking can seem like a hassle. Staying caught up with your acquaintances and obligations online isn't always easy, but there are occasions when we are reminded of all the meaningful ways in which our efforts can be rewarded.

Now, in the aftermath of the recent earthquake that devastated Haiti, is one of those occasions. The internet has made it infinitely easier for us to follow news reports, make donations, and reach out with our hearts and our hands to people in need, no matter how far away they might be. Recently, Tami's daughter alerted us to the existence of Help_Haiti, an online community set up shortly after Haiti's tragedy in order to raise money for survivors. Members of the community offered up their talents--as writers, artists, knitters, bookmakers, and just about everything else under the sun--in an online auction where 100% of the proceeds go directly to charities for Haiti. The first auction closed Wednesday of this week, and although moderators have yet to even finish counting up confirmed donations, the standing amount of money raised for UNICEF and other various charities is roughly $25,000. In a direct quote from the site: Since that only covers about 1/4 of the total donations we expect and hope for, we are wondering if the total could possibly hit six figures, once the various matching funds from people's offices, colleges and countries are factored in.

To put it mildly, this is inspiring. An extended online community coming together in total devotion to helping people in need reminds us of all the good social networking can be capable of. We live in amazing times when this kind of effort, made largely by people who have never met anywhere outside of a computer, is possible.

If you would like to be a part of the extended community, you can donate to Help_Haiti's UNICEF page here.

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Tami DeLand and Steve Hansen
Saint Cloud and Central Minnesota REALTORS
Coldwell Banker Burnet
(320) 258-6675
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St. Cloud Real Estate, Condos, Homes for Sale
Central Minnesota Real Estate
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Are you having difficulties getting financing for rural properties due to well and septic issues? Meeker and Wright county both offer several different financing options for buyers to help pay for replacement or repair costs on wells and septics.

As a personal example, I am working with a client right now who fell in love with a foreclosure home that needs almost $9000 in repairs on the septic system. The bank, like usual, said they would not pay for the repairs since it would require them to escrow money in order to be fixed in the springtime, and my client did not have $9000 to escrow. While at first it seemed as if this left him with no options, we discovered that he can apply for a loan through the county to get the septic fixed in the spring. His dream home can now finally become a reality!

--Sheila Grangroth
Buyer's Agent for Tami & Steve at Coldwell Banker Burnet

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Tami DeLand and Steve Hansen
Saint Cloud and Central Minnesota REALTORS
Coldwell Banker Burnet
(320) 258-6675
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St. Cloud Real Estate, Condos, Homes for Sale
Central Minnesota Real Estate
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The 2009 Tax Credit may have been the savior of our local housing market. The early months of 2009 were dominated by foreclosure sales. Bank-owned sales produced a lackluster first half of 2009 in housing sales. Foreclosures accounted for 25% of the Central Minnesota housing market. But the poor performance of the first half quickly regained momentum in the third quarter as a record number of first-time buyers purchased homes and were credited $8,000 for their decision to become new home owners. With foreclosures seemingly under control, the housing market has taken on a new look.

The following four trends of 2009 are defining factors for the 2010 housing market. First, The local inventory, or number of homes for sale, is at a three-year low. The year ended with ten percent fewer homes on the market than in 2008. Fewer homes to compete with is good news for home sellers. Second, although the average sales price is still on the decline-- -2% for non-foreclosure homes compared to -15% for foreclosure sales--this is a motivating factor for buyers. Third, the total number of units sold in 2009 is up 2% over 2008. Our brokerage, Coldwell Banker Burnet, sold 10% more homes in 2009 than in 2008. Fourth, 2009 was a year of adjusting absorption rates. Absorption rate is the number of homes available per buyer. Currently we only have two foreclosed homes available per qualified buyer (seller's market). The overall absorption rate offers seven homes to every active buyer in the market (slight buyer's market). A balanced housing market offers six homes to each buyer, and at that number, theoretically, neither buyer nor seller has an advantage in negotiating the sales price.

These four housing facts, plus the new tax credit for buyers and sellers, should make 2010 an improved market for move-up sellers and offer buyers excellent values. The tax credits end on April 30th, 2010, so act today if a new home is your dream.

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Tami DeLand and Steve Hansen
Saint Cloud and Central Minnesota REALTORS
Coldwell Banker Burnet
(320) 258-6675
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St. Cloud Real Estate, Condos, Homes for Sale
Central Minnesota Real Estate
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Now may be the time for the prudent home buyer to make the big move. I have four good reasons why 2010 is the time to make the move up to more square footage, a new lifestyle dwelling, an easy access floor plan, or a greener home. My top four reasons:

First, consider the net loss from the sale of a current home compared to the net gain from the purchase of a new home. Sellers in today's market might experience a 10% loss compared to selling a year or two ago, but they would benefit from the market decline when they purchased their new homes. Typically, a seller's new home will be twice the value of his or her previous home. It may look like this: Seller A's home was valued at $150,000 one year ago and sells at $135,000. Seller A experienced a 10% loss or $15,000 in her mind's eye. Seller A returns to the real estate market as Buyer A and purchases a home at $270,000. This home was valued at $300,000 in the previous year. The net gain to this buyer, now turned seller, is $10,000. This is my top reason to move up in a down market. Prices of higher priced homes have generally declined more than prices of lower priced homes.

Second, the buyer tax credit adds another $6,500 incentive to make the move up in a down market. Sellers who have lived in their current residences for at least five years are generally eligible for the new move up tax credit. If a home owner considers the price his current home would bring and the adjusted savings he will receive on his new property, plus the federal tax credit, the move up scenario sweetens.

Third, the current interest rates. With home mortgage interest rates well below the forty year average, most loan applicants are receiving a thirty year, fixed rate below six percent. Add up the net gain in purchasing up in a down market, the move up buyer tax credit, and the current low rates, and the consumer interested in purchasing a new home has a prudent decision to make.

Fourth, we may be experiencing the final months of the buyer's market. With inventory on the downturn and the number of sales on the rise, the number of homes available per buyer may soon be in a balanced position where neither buyer nor seller has an advantage. After careful consideration of the long-term financial gains for moving up in a down market, it is also important to consider the lifestyle enhancement reasons that influence the move up.

We have experienced a lengthy thirty-six to forty months of housing recession and it has produced an enormous amount of pent-up buying demand in individuals and families who want or need to move. The reasons for the pent-up desire to move vary from wanting more space to a desire for a greener or more energy efficient dwelling to wanting to be closer to employment or family. Whatever the reason, now is clearly the best time.

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Tami DeLand and Steve Hansen
Saint Cloud and Central Minnesota REALTORS
Coldwell Banker Burnet
(320) 258-6675
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St. Cloud Real Estate, Condos, Homes for Sale
Central Minnesota Real Estate
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