Real Estate Snippets

Stamp Price Increase

Having heard the rumors of the postage increase and wanting to avoid the last minute rush for 2 cent stamps to fill out my old supply, the trek was made to the US Post Office.  The request was for a roll of 100 new stamps ($.41 each) and a book of "2 centers".  The stamp in the picture is what my $.41 cent roll looks like.  No numbers?  Hmmmm.  Is this one of the new "forever stamps" I'd heard rumors about?

The ever helpful internet not only eliminated the stamp above from the "forever stamp" category, but also substantiated the rumored "forever stamp".  Check out this little snapshot straight from the US Postal service website:

The rumor is true.  There is going to be a stamp that can be purchased for the May 14, 2007, price of $.41 which can be used forever (or until they change their mind!) on one ounce first class letters regardless of whether the price goes up or not (which, of course, we all know it will!)! 

Instantly, my question is whether people will stock up on them.  Will there be a rush to the post office like there was to the West when gold was discovered?  Will enterprising entrepreneurs buy warehouses of these stamps to sell at future profits?

Full details on the rate change can be found at the US Post Office website.

Spring in St. Paul

SURE SIGNS OF SPRING IN ST. PAUL:

  

 

Real Estate Agent as Fire Fighter

Real estate agents have another duty that is not commonly discussed.  We're fire fighters!  Yes, you heard right, fire fighters!  At any time during the transaction when something goes awry,  the real estate agent often is the one who discovers the problem, gets to bear the bad news, works with his/her team to solve the problem, acts as mediator between opposing parties, or soothes the frayed nerves of parties in the transaction.  It's a nerve wracking position to be in.  The client wants to know the details but be reassured at the same time.  The other parties want the same information.  Sometimes an addendum is lost or never received.  Sometimes terms of the sale are misunderstood.  On rare occasions the buyer's job status changes.  There are so many aspects of the transaction that can impact the final closing that we never know for sure that it will close until it has closed! 

Having an agent that keeps tabs on your transaction AND who has a good team of professionals in their network to process the transaction (title company, closer, mortgage originator, inspectors, etc.) can make a huge difference when a fire in the transaction starts.  A little spark in the transaction can be dealt with quickly by good professionals so it doesn't become a wildfire burning out of control.

I've had many little fires start.  Buyers have lost their jobs.  Buyers have gotten jobs in another state when they were 10 days from closing.  Sellers have misunderstood what repairs were requested to be done and not completed the repairs.  Counter offer addenda have not been received by the mortgage company and the change in purchase price not discovered until the day of closing.  Sellers have removed personal property that was agreed to be left as part of the sale.  Refrigerators have been switched for other brands.  Each scenario is a story in itself.  The fire fighting ability of your real estate agent and his/her team can make or break the deal when these issues arise!

Tougher Dog Ordinance

Considering the media coverage of recent dog bites in St. Paul, the title on the TwinCities.com article this morning led me to believe  St. Paul was going to have tougher laws against biting dogs.  When something tragic like dog bites, shootings, drunk driving with injuries, etc., happens, there's often a public or political outcry to ban the breed, ban guns, or add restrictions to driving, or whatever else can be blamed for the problem.  This article, however, is going to prevent owners who have been cited for neglect of their dogs repeatedly from getting their dogs licensed in the future!  That makes about as much sense as preventing law abiding citizens from owning a licensed gun because criminals shot someone with a stolen gun!  If someone neglects their dog, is it going to matter to them if they can get them licensed or not?  This is another one of those things that make me go, "Hmmmmm?"

Architectural Details

Every body has different tastes in houses.  Some like sleek and modern.  Some like old craftsmanship. Some just want a clean roomy place to hang their hat.  There's no doubt about it, though.  I am a sucker for old world craftsmanship.  I love original wood.  I love details.  I love bubbly varnish.  Woodwork with patina?  That's my thing.  This little collage tells it all!

Senate File 442 Affects Homeowners

The Minnesota Senate Finance Committee is meeting Wednesday morning, April 25, at 8:30 in Capitol Room 123  to hear testimony and vote on Senate File 442, a change in the state deed tax.  If you own a house and sell it in the future, Senate File 442 will impact your sale if it passes. 

Currently when a house is sold and the deed is filed, the filing fee is $3.40 per $1000.  A house that sold for $100,000 would pay $340 for filing the deed under today's law.  Wednesday morning the Senate Finance Committee will vote on whether to increase that tax by 50% to $5.10 per $1000.  That same $100,000 sale would have a new deed tax of $510.  The median price for a home in Ramsey county in February was $203,000.  The deed tax for a median priced home sale would be $690.20 under the existing system.  Under the proposed change in the deed tax the new tax would be $1,035.30!  The $345.10 difference could pay for the home buyer's inspection on that same house.

If you'd like to take a stand on this bill you can click  here for a sample response to your Senator.

End of the Month Real Estate

The last few days of the month are usually quite busy for real estate professionals. During the feeding frenzy the last few days of the month were downright crazy.  If a slot wasn't reserved for the closing before the appointments were filled, the transaction closed on a different day.  The time isn't quite as tight for closings now, but it's still a good idea to plan ahead if the closing is at the end of the month.

The closing date is chosen when the buyer's real estate agent writes the purchase agreement.  Personal conflicts are taken into consideration as are how the closing date will affect acceptance of the purchase agreement.  In most cases, closing dates are not a big factor in whether an offer is accepted or not.  Occasionally, the seller may have a personal conflict which has to be avoided just as the buyer may.  Either party may have work travel plans that can't be adjusted, medical reasons, or important personal conflicts.

The commonest choice for closing date by home buyers is the end of the month.  Those unfamiliar with real estate may assume that's because apartment leases are up at the end of the month, but that isn't the main reason. 

The primary reason to close at the end of the month is financial.  Buyers make their mortgage payments AFTER they have been in their home for a month.  If the closing is April 27 of this year, the first mortgage payment is made on June 1 (the first day of the next month following closing).  Mortgages are charged interest on a monthly cycle so the payment made on June 1 includes interest for the entire month of May.  The buyer has had use of the mortgage company's money for more days than the month of May because the closing was April 27.  As a result, daily interest for April 27, 28, 29, and 30 are collected at the closing.  That's 4 days of interest.  On a $200,000 loan at 6% that four days of interest equals about $133.00.  If the closing is 15 days before the end of the month (April 15), the interest collected at closing would be about $500.  When buyers are tight for money to pay closing costs that extra $367 can make a difference.  It's also money buyers would rather spend on new curtains, a lawn mower, or some other house related item!

This one factor alone explains why real estate closings tend to fall in the last half of the month and the vast majority are in the last few days.  It's pure dollars at work!

Blog Wars

Teresa Boardman of St Paul Real Estate Blog and Larry Cragun of Mortgages Undressed have been duking it out on their blogs for quite some time now.  It all started with Teresa's post about box elder bugs which she detests and Larry thought were cute.  As often happens in the blog world, posts take on a life of their own and Larry began a "Bugs Undressed" and a "Don't Bug Me" series in which he posts bugs, but really takes the day off from blogging.  It's a great idea . . . one I wish I had thought of myself. 

The next big jab came when Larry accidentally posted a bathroom picture and labeled it as a living room.  Teresa was beside herself with the opportunity to make fun and a long battle ensued which ended with a white flag and truce being declared.  But, Larry didn't really know what he had started oh, so long ago.  I warned him that white flags don't work with Teresa.

So, when I got this cute little singing bug in one of those forwarded e-mails, I couldn't resist sending it to Teresa to post for Larry.  I knew it was just the right fodder for their battle.  Check out her post here.

New Reality Real Estate Show

The curmudgeon from Chicago announced today that HGTV is starting a new reality TV series called "Bought and Sold".  I'm sure none of you react when you watch the real estate shows on TV, but many times they've left me cringing, especially the ones that show an agent as the "tour guide" of the home.  Nothing grates on my nerves anymore than an agent walking into a vacant bedroom and saying, "And this is the bedroom."  No, duh!  The show depicts the buyers finding their properties through newspaper ads instead of getting e-mails of property listings from the agent as well.  It conveys real estate agents as bimbos who only open doors . . . which I jokingly tell clients is the hardest part of my job!

Clients who have been privy to the services provided by their agent constantly wonder at the amount of work an agent puts into the process.  Not only does the agent screen properties on the MLS to find the best fit for their clients' criteria, but they also research the market to see how close houses compare to others in that same area.  Agents are aware of physical defects and disclose them to their clients.  Sometimes agents even talk their clients out of buying a house because of condition or because of price.  Hours and hours are spent in examining data; choosing homes to show, scheduling showings; comparing the house to others in the neighborhood; advising on terms and pricing of the offer; presenting the offer in its best position; negotiating inspection repairs; processing paperwork; etc.

The new reality real estate show is supposed to show the life of a REALTOR®.  I can't wait to see if their rendition matches my experience!  Will they show an agent picking up pet feces before an open house?  Or scrubbing the kitchen until it gleams?  Or replacing switch plate covers?  Or meeting city inspectors because their client is out of town?  Or calling the city for information on whether the property can be split in the future?  Or acting as mediator between divorcing parties?  Or calming a client so they realize $500 in a $500,000 sale is peanuts?  Or crawling in a window when one gets locked out?  Or passing out tissues when the offer is declined?  Or reassuring the client that cold feet is normal and that feeling will pass?  I can't wait to see how much this new show will mirror my life, because as Gene Molloy says, "Real estate is my lifestyle, not my job!"

Some Rules Need to Be Broken!

I'm basically a law abiding citizen.  I stop for stop signs.  I yield when it says yield.  I abide by the MLS rules and regulations . . . but that doesn't mean I have to like the rules!  There's a new St. Paul listing coming my way which is a unique property near Como Lake.  It's been very nicely updated, is in a high demand geographic location, and sits on 1.5 city lots.  The dilemma is this property's best use is as an owner occupied property, but it's a legal duplex and must be listed in the duplex category of the MLS, not the single family category. 

Before the technological age, one could duplicate a listing like this, one listing in the single family and one in the duplex category.  It would never be found.   Today, that is not only against the rules, but it will be caught.  Programming has been established by the MLS to ferret out properties whose listing categories do not match their tax records description.  When the conflict is discovered, the listing agent can be fined if they do not immediately remove the listing from the wrong category.

In this case, the listing will be placed in the duplex category thereby narrowing the pool of buyers significantly.  Buyers who might love this house as a single family home will not even see it because it will not be in with other single family homes.  Not only will that extend the time on the market significantly, but it will also increase the time and monetary cost of advertising using other means.  Flyers will have to be distributed to each listing company with a catchy headline that will encourage agents to bring single family buyers; mailings will have to be done; more paper ads will need to be generated; more open houses held; more internet exposure; and more creativity will have to be expended.  It will be like the good ol' days when listings were sold by word of mouth!