Downsizing = Lifestyle Change

As the Baby Boomers are selling their large homes, modest homes or just moving into smaller quarters they may not be "saving" money.  The reason to downsize in Minnesota or at least the Twin Cities should be for the lifestyle change.  Many of the town homes and condos in the southwest corner of the Twin Cities are as expensive as owning a home.

This is what is on the market at this time:

Square footage: 2000-2500
Town Home ~ $275,000
Condos ~ $485,000
Homes ~ $315,000

Square footage: 1500-2000
Town Homes ~ $211,500
Condos ~ $279,000
Homes ~ $252,500

Add Association fees onto your mortgage which can run from $200 - $1200 depending on the amenities and if they have been managing the funds correctly.

Questions to ask when reviewing a Home Owners Association (HOA) documents:

1. How much are the monthly fees? Has there been a recent increase, are they expecting an increase?
2. What does this fee cover? Insurance, heat, water, amenities, common areas
3. Ask for a copy of the Rules and Regulations and if they are enforced.
4. How much is in the reserves?
5. Are there any pending assessments?
6. Is this a privately managed association or is an outside party managing the funds?
7. How many own their condo and how many rent?  Is there a ratio, an example would be that there are 15% rentals allowed? How is this enforced?
8. Has this HOA been involved in any lawsuits?
9. Ask for a copy of the financials.  This is not usually given out unless an offer has been accepted.

Whatever you choose a condo, home or town home make the change in order to improve your life.  Many of the condos are very social and are designed for one level living with heated garages. Town homes are usually set up to be like living in a house with shared walls and amenities, there are very few one level living town homes.  A single family home can be perfect depending on the individual and their personal and physical needs.

Hopefully this will help you chunk down the options from a financial perspective.

4th Quarter = Buyers Market

It is that time of year again...winter.  This is the time of year that everyone wants to take their house off the market and wait until the spring market.  Why?  Do buyers stop buying in the winter? No, they continue to buy all year round although they do get frustrated with the lack of good inventory.

The truth is the prices have gone up since last spring.  The median sale price for a home in April, the height of the spring season, was $233,000 and in September it is $239,000.  During this same time period there were 9,718 homes for sale in April 2015 and only 9,313 in September 2015.  The average days on market is the same about 43 days.

Now is the time to put your home on the market and sell it in time to go to your favorite warm weather spot for the winter!

Scarcity = Demand

If you like numbers then today is your lucky day!  Pricing and real estate are always changing. Today my discussion is to bring awareness to these towns and their prices.  Are there opportunities?

1.  Here are the median prices for new construction in these towns:
Bloomington  - $896, 275; number for sale 4, Days on Market 2
Eden Prairie - $827,495; number for sale 55, Days on Market 1
Edina - $950,470; number for sale 55, Days on Market 110

2. How long would it take at the rate the market is going today to absorb this inventory?
Bloomington 0
Eden Prairie 6.5 months
Edina 15.5 months

3. Homes for sale that are previously owned and over $900,000
Bloomington - 3
Eden Prairie - 53
Edina - 46

4. Homes for sale over $650,000 that were previously owned
Bloomington - 26, Absorption rate (months supply) 7.6 months
Eden Prairie - 132, Absorption rate 11.6 months
Edina - 282, Absorption rate 8.7 months


What are all these numbers telling us?
I think it is pointing to a need for new builds in Bloomington and a potential uptick in sales of higher priced homes.  If you are going to put your home on the market and it is over $500,000 please stage and update the kitchen.

Listing your home = wearing a hair shirt (sack cloth)

I was thinking about the Renaissance festival and how strange that time was in history. Sure jousting or eating a turkey leg like a barbarian are cute but then there is the really strange stuff. The weirdest for me is the hair shirt. Per my understanding it was originally a garment or undergarment made of coarse cloth (sackcloth) or animal hair (hair shirt) worn close to the skin to cause irritation. To bump up the discomfort they would add twigs or thin wires! It was used in some religious traditions to induce discomfort or pain as a sign of repentance and atonement.

  Well to put it simply, listing your home is like wearing a hair shirt! It is perpetually uncomfortable and nobody really looks forward to the process of preparing their home. It is not natural to stage your home with rented furniture and paint it colors that other people would like instead of your color taste. It feels like it would be itchy and uncomfortable all of the time. Hence the hair shirt analogy.

It doesn't have to be this stressful and uncomfortable!

 1. Use professionals to break down the process: a stager, de-clutter professional, moving company, checklists and handymen.

 2. Realtor - Know your numbers, how much it will cost to sell your home? Net sheet, market analysis 

3. Put a deadline to the process, decide what needs to be done and then put the resources you have available to get it done. This way you will be ready faster and the market should be about the same as it was when you started the process. The market changes so ask your Realtor to update your numbers as the market changes. 

4. Depend on worse case scenario. It is always best to prepare like it has to sell. 

5. Focus on the outcome and the direction that you, your family or whatever the scenario, are trying to accomplish. It will be a wonderful future ahead!

6.Keep a positive attitude, it always attracts the best results. You may even see the hairshirt as funny?