Archive for December, 2010

Minneapolis Housing Market Shows Its Personalities

said on December 7th, 2010 categorized under: Twin Cities Real Est

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sybil textlessI’m going to date myself here, but do you remember “Sybil”?

“Sybil” was a book/movie about a woman with more than 13 different personalities– all wildly different from each another.

Like the Minneapolis duplex market.

For example, during the week ending November 27, pending duplex sales dropped 35 percent from the same Thanksgiving holiday week last year.

However, 27 percent of this year’s transactions involved traditional sellers. Much like last year’s 24 percent.

Of course, the average price those properties left the market at, $180,980, shattered last year’s comparatively paltry$118,550.

In fact, the only duplex activity that seemed consistent and normal was the amount of new listings during the week: 21 this year and 22 for the seven days in 2009.

At least the single family home market was predictable. Buyer activity was down 5.5 percent from last year, but that’s been the running number the past few weeks.

The number of newly listed homes fell a similar amount from the 2009 holiday week; slowing 6.4 percent.

Kind of boring, but kind of nice.

Like Sybil.

When she was cured.

Who Will Save The Housing Market?

said on December 6th, 2010 categorized under: Multi-Family Property Investing

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3d super hero with red capeWho or what’s going to save the real estate market?

With another tax credit increasingly unlikely, it won’t be the first time home buyers.

With Congressional talk of eliminating the mortgage interest deduction, it probably won’t be homebuyers, period.

We all know it won’t be the banks.

Who’s left?

As I’ve been saying lately, investors.

And now, I’m not alone in that sentiment. Last week, CNBC featured a profile of a hedge fund investor who’s already sunk $10 million into the real estate market; not to flip the properties he’s acquired but rather, as a buy and hold strategy.(Investing in Foreclosures – CNBC.com.)

As we’ve discussed before, you don’t need to be rich to be an investor. Half of the real estate investors in this country have incomes from their regular jobs of less than $85,000 a year.

 Heck, you don’t even need to buy a duplex. Remember, there are a lot of foreclosed single family homes flooding the market; so many that they’re selling at deep discounts.

People like to rent them.

And the principles of property investment apply to single family homes the same way they do duplexes, triplexes, fourplexes and apartment buildings.

If you’d like to learn more about helping the housing market recover and securing your financial future by investing in real estate, call.

I can’t remember when there’s been a better time to invest in real estate.[vimeo]

Comments Off on Who Gets The Security Deposit When A Duplex Sells?

Full sack locked by gold lockThe other day a tenant asked me if the duplex owner would be refunding her damage deposit before the property sold.

Shortly thereafter, a seller asked if he would need to do the same.

The answer in both cases is “no”.

Most real estate investment agents include an addendum to any purchase agreement that asks for any damage deposits and interest they’ve accrued to be assigned to the buyer at closing. In addition, the addendum should include language that assigns the leases to the buyer at closing.

The seller is also not allowed to make any deductions for any damage the tenant may have already caused.

The reasons for this are simple. The tenant is protected by the lease, which survives the sale. Any transfer of a security deposit prior to the end of that lease is a recipe for drama.

For example, what if the seller gives the tenant her money, and she never gives you a deposit? How long will it take to evict her? How will you pay for any damages the property suffers?

What if there never was a damage deposit at all?

And from the tenant’s perspective, what if the seller decides to withhold the entire deposit because of perceived damages that may or may not be there; leaving both you and the tenant in a financial hole?

A properly drafted purchase agreement signed by both the seller and buyer is a legally binding contract and when it comes to leases and security deposits, ensures the protection of everyone involved.

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