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Your no-nonsense real estate guide
October 2012
The pros and cons of buying a fixer-upper
For many first-time buyers, getting a great deal on a home that needs a little work may seem like a cost-effective plan. However, there are many things to consider before closing on a fixer-upper.
First, consider the neighborhood. If the home is located in an ideal neighborhood, you may have found a winner. Once fixed up, it’s likely that the neighborhood will help to elevate the price of the home. If the listing is in an area with a high crime rate, or surrounded by other similarly outdated or unkempt homes, you are less likely to make a significant profit once you’ve fixed up the home.
Second, think about the necessary repairs. Some of the money you save on this home will be needed for updates, but you should make sure the home isn’t in need of major renovations. Plumbing, electrical, heating and cooling systems can be extremely expensive to replace. Determine the budget you have for the home purchase and any updates, and be sure the home is in need of repairs you can afford.
Have the home inspected before making a final decision, as this can reveal exactly what repairs should be made by the seller, and what can wait until after the purchase. Inspectors can also provide you with an estimate on how much these fixes or repairs will cost you, so you can ensure you stay within your above budget.
Last, think about what kind of person you are. If you’re buying a home because you want to come home after work and put your feet up, a fixer-upper is not for you. On the other hand, do you not mind the clutter that comes with long-term home improvements? Do you live for DIY shows? Do you want to craft a space that feels just like home to you, even if it may take a few years? If so, then a fixer-upper may be for you.
Market update: Six straight months of price increases
Summer is winding down and kids are back in school. We’ve been brushing up on our arithmetic as well, to bring you a summary of current market conditions, which are showing signs of consistent improvement, rather than just a flash in the pan.
August was another exciting month in real estate, marking the sixth straight month of sales price increases. Median sales price was up 15.5 percent – from $155,000 in August 2011 to $179,000 in 2012. What a difference a year makes!
A major contributor to this boost in sales price has been a dearth of homes for sale. With only 16,348 homes for sale, August marked the lowest inventory levels since December 2003.
Confidence in the housing market is on the rise according to Fannie Mae, which recently released results of its August 2012 National Housing Survey. “Consumer attitudes toward the housing market remain modestly positive despite signs of increased concern over the direction of the economy,” said Doug Duncan, senior vice president and chief economist of Fannie Mae.
What is your home worth today?
Do you feel the changing winds? It’s not just fall coming in. As we mention in the above market update, the buyer’s market is quickly turning into a seller’s market. When fewer homes are on the market, sellers with quality homes can expect to earn a higher sales price as buyers are forced to compete.
If you’re a would-be seller on the fence, consider reaching out for a free home value estimate. There’s no pressure to list, and no obligation to hire – just an easy analysis of what your home may be worth in today’s current marketplace.
Minneapolis is ranked the second worst city for renters
For decades, we’ve heard of New Yorkers dealing with impossibly increasing rental costs. What if we told you that Forbes ranked Minneapolis as the second worst city for renting after New York City?
We were surprised, too, until we looked at all the factors leading into this ranking. In the below infographic, we show how the market has shifted to make buying in the Twin Cities more affordable than renting.
Tips for successful long distance moves
It’s no secret that long-distance moves can be considerably stressful. By planning ahead and considering different cost-effective options, you can make relocating to your new home easier.
First, work to declutter far in advance of your moving date. Sort through items prior to buying boxes or hiring movers so you don’t overbuy or overbook. If you’re moving to a new climate, rid yourself of the clothes you’ll no longer find necessary. Pay special attention to the boxes that sit in storage – if you haven’t used the items inside since before the last time you moved, do you really need them? Consider donating gently used items to a shelter, or holding a yard sale to make some additional money prior to moving.
While some homeowners may find it less expensive to rent a moving truck and relocate on their own, there are other alternatives to getting your stuff to your new home on a budget. Instead of hiring movers, you can have your items shipped and delivered once you arrive. Rates offered by moving services can depend on multiple factors, including gas prices, so be sure to get estimates from multiple companies before making a decision. Edina Realty Relocation has partnerships set up with several moving services nationwide, and they can assist you in making your decision.
If you decide against hiring packers and movers, be sure you have the supplies needed to safely transport your fragile items. Buy bubble wrap, packing paper and special boxes for artwork, mirrors, and other glassware or delicate items. If you have old sheets or blankets that can stand a bit of wear and tear, keep those out to cover furniture or other larger items in the moving truck.
Will you be driving your own car, or shipping it? If shipping, be sure to call well in advance and get confirmation of the exact date of arrival to be sure you will be in your new home.
Three easy ways to update your home before selling
After deciding to put your home on the market, you may be wondering what improvements will make your home stand out against your competition. HGTV’s Front Door has a short list of easy updates you may want to implement so you come out on top when competing with other Minnesota homes for sale.
According to HGTV, painting your home can be an inexpensive update that will make one of the greatest differences when selling. When painting the inside of your home, HGTV suggests staying away from white and avoiding the use of the same color throughout different rooms. By using a neutral color, you will make the home feel warmer and more inviting. The source also recommends giving the baseboards a fresh coat of white paint.
To brighten the areas of your home that don’t get much natural light, HGTV recommends updating the lighting in the bathrooms, hallways and especially the kitchen, if it isn’t naturally lit. The site recommends investing in brushed nickel or stainless steel lighting fixtures, which buyers reportedly favor.
When potential buyers are visiting your home, first impressions are likely to stick in their minds. Trim up tree branches and outline shrubbery to give your home an instant boost in curb appeal. In addition to gardening tips, the source recommends changing out your old doorknob for something with more character. You may also want to switch out old address numerals as a quick attention-grabber.