Longfellow Nokomis Real Estate Guide

What's Up With This $7500 Tax Credit?

Good question.  Congress has been passing laws faster than the industry knows what to do with them.  The current law, as was passed last year, gives a $7500 credit on your tax return for qualified first-time buyers who purchase a home between April 9, 2008 and July 1, 2009.  Except it isn't a credit.  It's a zero interest loan that must be repaid on your future taxes over the next 15 years.

As you can imagine, this did little to stimulate the housing market.  It doesn't increase your ability to purchase a home.  It just makes expenses easier to handle once you're there...eventually...when you get a refund...that you pay back.

The new stimulus plan that passed the house on Wednesday turns that credit into a...CREDIT!  If the bill becomes law, that $7500 would become a straight-forward credit on your 2009 returns.  It would retroactively include purchases made since January 1, 2009 and extend through either June or August (depending on the bill). 

Will this simply be a windfall for the qualified first-time buyers who were going to buy anyway?  Or will this be enough incentive to convince someone on the fence to buy?  It still won't give you $7500 to use towards your down payment.  But knowing it's there in 2010 may just be the assurance you need, that you can afford to buy in this well priced market.

Yesterday I wrote about inman news saying we were in for more foreclosures. Today, the Minneapolis Area Association of Realtors released very specific information about foreclosures and a much better picture of how foreclosures are effecting the different MLS districts. One of the "scientists" behind the data is Edina Realty's very own Aaron Dickinson

See the roreclosure report here to see how foreclosures effect where you live.

More Foreclosures?

I've tried to duck under tables, hide behind closed doors, and cower in dark corners. No matter where I've tried to hide myself, the foreclosures and short sales have found me. I've done my best to conquer the demon and have gone to classes, and studied under agents who specialize in these kinds of transactions so I can represent my clients to the best of my ability. That doesn't mean I like them. I don't. These transactions are difficult, and often take a toll on the sellers (in short sales) and buyers. It takes a bank months to do what a good real estate agent can do in a week.

One of my clients, a first time home buyer, is looking for a foreclosure. He needs to keep his monthly payments down and doesn't mind doing some work on the house. He commented to me "It seems there are more houses coming on the market now." My response was "Yes, the suits are back from their holiday hiatus and are now ready to go to work to unload the inventory they've gathered up over the holidays."

An article this morning in inman news is predicting even more foreclosures to hit the market (again, remember this is a national newsletter and may not reflect what's happening in the twin cities metro). Even though my clients are not economists, nor do they have crystal balls, they are noticing the trend here in the Twin Cities.

I met a first time home buyer over the weekend who was looking in Minneapolis for a foreclosure. He was shocked to find out there were offers on two of the homes we looked at. If you're going to be in the market for a foreclosure this spring put on your running shoes. You're going to need an agent who watches the market very closely for you, prepares you for the ups and downs of dealing with these difficult transactions, and you HAVE to be ready to write the offer as soon as you see the house.

If Inman News' prediction is correct, the foreclosures we'll see come on the market will be listed at fire sale prices. There will be buyers who will think they can get the house at clearance prices, and a few will. The majority will sell at fair market value, because they'll end up with multiple offers that will drive up the price.

The buyers who will win in this market have a great agent, are pre-approved with a NON-fha loan, have reasonable expections for how long the negotiation process will take, and aim to get the house at a fair market price.

2009 U.S. Pond Hockey Championships

The U.S. Pond Hockey Championships return again to Lake Nokomis this weekend (January 23-25), and it sounds like an icy blast of arctic air will arrive just in time to scare away any thin skinned spectators.  The website for the event even includes safety tips for cold weather!

And remember, it was warm weather than brought the tournament to Lake Nokomis in 2007 from Lake Calhoun.  The ice just wasn't good enough after the mild winter.  We're glad to see them back here for a third year.  I bet the new Caribou will do a lot of business this weekend.  If you want to help out a local coffee shop, try crossing over the lake to Nokomis Beach Coffee.  Great coffee and locally baked pastries will surely warm you up.  Plus hot soup and sandwiches!

Found in Nokomis

I saw this minivan parked in my neighborhood and had to stop and take a picture.  This was last week when it was 30 below zero so I was NOT going to get out of the car. But, it was interesting enough to roll down the window to brave the cold for a quick snapshot.

I've always been a fan of car art. This minivan owner tried to disquise his minivan as an aquarium.
Send us your pictures of other car-art and we'll post them here. There's no better way to show off Minneapolitans creative self-expression.

 

A Plea to Nokomis and Longfellow residents...

...Get your butt back into the local stores.

Hey, I understand every penny saved in this economy is important. I understand you might save .50 by buying cereal at the Target on 66th in Richfield instead of going to Oxendales or Bergan's Super Valu. 

We all lose if our locally owned, locally run stores go out of business and we end up with rows of empty commercial space in our neighborhoods. When the gas prices were over $4.00 a gallon I sure appreciated being able to walk to the local grocery store.

You might find this interesting...

Source: Minneapolis Observer

Why Local Shopping Pays
In a comprehensive economic survey completed in the Chicago area recently, researchers found that for every $100 spent at a local business, $68 remains in the area, whereas the same amount spent at a chain establishment yields only $43 for the community ( www.andersonvillestudy.com ). Small neighborhood shops like these also have so much more to offer in terms of unique goods and personal service, that it’s hard to imagine why anyone would go to an impersonal big-box retailer.

What’s most amazing about the following walk through some of our city’s more interesting--and often overlooked--“Main Street” shopping areas is that it truly only scratches the surface. So we urge you to use the holiday shopping season as an opportunity to explore the amazing commerce all over this city, and especially right in your neighborhood.

If you haven’t poked around in the nooks and crannies of the city lately, you may be surprised at the marvelous shops that are popping up in what once were considered the least likely places. Consider 11th and East Franklin in the Philips neighborhood, for example.

It may be too late for our beloved Scandia Bakery, but there are lots of other locally owned stores that need your support.

I'll List Your Home For Free!

   

There have always been choices when it comes to hiring a real estate agent.  From do it yourself brokers that put your home on the MLS with pictures you provide for an upfront fee, to full service companies that charge up to 7% of the sale’s price.  Then within each company there are many different agents with different styles, experiences, talents, and ethics.

It’s a lot for the consumer to sift through.

I want to discuss one of the options:  Free.

There are several companies and agents who are trying out a plan where they charge no commission to list your home.  In turn you must agree to work with them on the purchase of your next home, where they will be paid a cooperating commission from the listing broker of that home.

And they do everything a full service agent does, except for open houses.  But you are free to hold your own.

Yeah, right.

Trust me.  Don’t expect them to do anything other than put your home on the MLS and put a sign in your yard.  And they may charge a fee for that much.

Here’s why I don’t like it:

1)        It’s not free.  You still have to pay the cooperating broker that represents the buyer.  That’s typically 2.7%.

2)       You’ve now entrusted what’s most likely your most valuable asset to someone who has told you that what they do is of no value.  If it was of value, they would charge you for it.  I’m willing to cut your hair for free.  Any takers?

3)       Saving $6,000 in commission and then selling your home for $10,000 less than a good full service agent could negotiate for you is hardly a deal.

4)       You have a no-value, limited-service agent on your side.  The buyer may have a full-service, full-value agent on theirs.  Good luck.

5)       The financial incentive of your agent is not connected to the price of your house.  It’s only connected to the price of the next home you buy.  Their best case is to under price your home and sell it quickly at minimal expense to them. 

And remember, I’ll LIST your home for free too.  But I will charge a commission when I SELL it.