Archive for May, 2009

Surf’s Up In Minneapolis Duplex Market

said on May 7th, 2009 categorized under: Buying A Duplex

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surfer executing a bottom turnThere’s a curious phenomenon happening in the Twin Cities real estate market right now–

Multiple offers. Everywhere.

And here’s the thing. Banks and individual property owners (even those who live in single family homes) are putting their listings on the market at artificially low prices. On purpose.

Of course, this sends a wave of buyers and their Realtors flooding through the property. After all, everybody’s looking for a good deal.  And everybody still hopes they can catch the perfect wave a property.

The result? With so many buyers and so many offers, it becomes a bidding war and the duplexceases to be a steal.

And, buyers who miss out on these “Ohmygodwhattadeal’s” start panicking. They believe the good buys are being bought from under them, that they’ve missed the wave entirely, when the reality is, they only missed this one.

What are the lessons in this?

First, these listings are selling in less than 24 hours. If you’re in the market, or even considering wading into the sea, it’s unlikely you’ll even have an opportunity to paddle out without being committed and signed with a Realtor. These properties simply sell too fast, and the listing agents are too busy to call you back to show to set up a showing.

Second, just because one property is listed at the ridiculous doesn’t mean all the deals are gone. There are plenty of opportunities on the market. And if you’re working with an experienced, established agent, she will be able to guide you to them.

The market is changing, but we’re not out of beach. This summer, if you miss a single wave, it’s likely another one will come along.

Minneapolis Duplex Sales Bloom

said on May 5th, 2009 categorized under: Twin Cities Real Est

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A row with colorful silk tulipsSpring has finally arrived in the upper Midwest. Everywhere you look, lawns have turned greeen, tulips are in bloom and “sold” signs are hanging on properties.

For the seven days ending April 25, single family home sales posted another consecutive week of more than 1000 sales. Again, we are experiencing more than a month of this sort of volume;  atypical of  the market since 2006.

What’s more encouraging, however, is the 1,078 sales represented a 34.1 percent increase over the same time a year before.

While there seems to be countless new listings taking root everywhere, the perception of countless colored for sale signs in yards is something of an illusion. New listings are still lagging 16.4 percent behind their mark one year ago, with the total supply of available homes down 19 percent over last year.

Of course, the multi-family home market seemed to grow roses in the snow this year; a trend which has continued into spring. Pending sales of Twin Cities duplexes and small investment properties were up 69 percent over their mark last year at this time.

While 85 percent of last year’s duplex sales for the week were bank owned or mediated, the mark for the same stretch this year was comprised of 93 percent lender-involved properties.

The average off market price for the week of $84,800 also trailed considerably behind last year’s $157,988. Look for this trend to continue until all the dandelions of foreclosure have been weeded out.

Comments Off on Using Tax Credit As Downpayment Would Jumpstart Duplex Market

moneyWhile things seem to be heating up in the Twin Cities duplex market, some states are cranking up the thermostat even further by implementing bridge-loan programs that advance first time home buyers the cash they need to purchase a property.

For all intents and purposes, the loan acts as a second mortgage that becomes due whenever the buyer of the property receives their first time home buyer tax refund from the IRS.

I have encountered numerous credit-worthy first time borrowers out there. However, many do not have enough money saved for the minimum 3.5 percent FHA down payment requirement. While parents have always been a resource for many first time home buyers, many parents have seen their availability of extra funds shrink with their 401(k).

States that have created some variation of a down-payment loan program are: Missouri, Colorado, Delaware, New Jersey, Tennessee, Idaho, Washington, Ohio, Pennsylvania and New Mexico.

While I have not heard of an equally innovative program in the works for Minnesota residents, it never hurts to suggest one to your representatives in the state legislature.

Bed Bugs Bite Minneapolis Duplex Landlords

said on May 1st, 2009 categorized under: Legal Stuff

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bedbugs_bedbugandswarm_s2When I was a kid, my dad often said just before he turned out the lights in my room, “Good night, sleep tight, don’t let the bed bugs bite.”

I’m glad I didn’t know what bed bugs really looked like; or what they did.

Bed bugs have been in the news a lot lately. After disappearing from the U.S. for 50 years, they seem to be making a comeback.

So what exactly are bed bugs? They’re small, wingless insects that feed on the blood of warm-blooded animals and tend to take up residency where those animals nest.

In other words, in places like beds.

What does this have to do with duplexes? Well, if you or your tenant experience a bed bug infestation, who’s responsible for cleaning it up?

The landlord.

See, bed bugs are considered pests. And while it may be a reasonable assumption that the little critters came in with a tenant, unfortunately, they don’t wear name collars or have microchips. There’s no way to prove it.

A reader recently shared a frustrating experience with a reoccurring case of bed bugs in her tenant’s unit.  After the considerable cost of hiring an exterminator, not to mention the inconvenience, her tenants continued the bad habits (such as excessive clutter) conducive to bed bug infestation.

Needless to say, the bed bugs came back.

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