There is a record volume of foreclosures across the state in the wake of the subprime loans crisis, but that doesn't means sales are at a standstill.
     
      Down markets tend to foster creative thinking, and now deal-making Dave Camp a Minneapolis area real estate practitioners are skipping a key step in the negotiation process, and allowing people in foreclosure to get their home sold.
     
     

Coon Rapids residents, city and county officials, MnDOT personnel and Ames Construction crew members gathered near the center of the new six-lane Hanson Boulevard bridge and interchange over Highway 10 late Tuesday afternoon.
     
      Some bicycled, some walked, some finished their commute onto the bridge via wheelchair, SUV, mini-van, truck, trailer, sports car or luxury sedan.
     
     
     
      All had come to celebrate the finish of the bridge, a roadway that Coon Rapids Mayor Tim Howe called “a major gateway to our city.”
     
      Excited proclamations mixed with the dull roar of traffic streaming below as dignitaries cut the ribbon and officially opened the new bridge.
     
      “I’m anxious to hear the WCCO radio traffic report tomorrow morning and not hear that Highway 10 at Hanson Boulevard is congested,” commented Dennis Berg, Anoka County Board Chairman and chairman of the Public Works Commission.
     
      Berg was one of several city, county and state officials addressing the crowd and celebrating the bridge opening.
     
      After a brief moment of silence in memory of the victims of the 35W bridge collapse, elected officials expressed praise and gratitude to MnDOT personnel and Ames Construction crew members for their diligence and determination to complete the project in a safe and timely manner.
     
      The bridge was completed in just 98 days, two days ahead of the original 100-day deadline.
     
      Ron Ames, president of Ames Construction, the firm building the bridge, said, “It was a real privilege to be part of this project. We closed the old bridge to begin working on the new bridge. We survived drought, wind and heat and we finished the striping in a rain storm. Now this beautiful bridge is open and we couldn’t be happier.”
     
      Residents and area business owners shared Ames’ happiness, relieved to finally put the pedal to the metal and cruise over Highway 10 on the new bridge.
     
      According to Berg, the old bridge was “totally structurally sound but capacity deficient.”
     
      The completion of the six-lane Hanson Boulevard bridge signals the next step in Anoka County Highway 10 road construction: adding third lanes to the highway between Highway 610 and Anoka.
     
      “We’re ready now to take the next step,” Berg said.
     
      The most unique feature of the bridge is the single-point diamond signal configuration in the center of the bridge. This configuration, only the second of its kind in the state, is designed to ease the flow of traffic from exit ramps, allowing drivers exiting Highway 10 to cruise through the ramps to the center of the bridge.
     
      “This is a new, innovative type of signal,” said Doug Fischer, Anoka County highway engineer. “It eliminates signaling at the end of the ramps, makes for better traffic flow.”
     
      Longtime Coon Rapids residents Larry and Elaine Keller have lived in the city since 1959.
     
      After walking from their home to the bridge Tuesday afternoon, anxious to witness the opening of the new bridge, the Kellers echoed many residents and commuters, exclaiming, “Wow! The bridge is open. This will make life so much easier.”
     
      Sue Austreng
      ABC Newspapers

This is just a quick note on semantics and the power of them. Searching the web for stories on real estate and housing I find two different tones in the stories.
     
      If I am looking for a story using the term real estate, the stories typically are very authoritative and businesslike. They focus on the transaction and physical nature of the property, they rarely talk about individuals.
     
      If I am looking for a story using the term housing, the stories usually are focused on something bad that has happened to a group or individual. There is angst and depression and usually a political or social undercurrent in the story.
     
      You never hear about affordable real estate, you hear about affordable housing.
      You never hear about the real estate bubble, you hear about housing bubble.
      You never hear about a state real estate project for the homeless, but they sure are called housing projects.
      Is it temporary real estate, or temporary housing? Conversely, low income real estate or low income housing?
      So my question to you, if housing is such a personal term that evokes a personal relationship, why don’t real estate agents call themselves housing agents? If we are looking for a personal relationship and we know that housing is such a personal term, is that more advantageous to be a housing agent?
     
      Does the term housing agent bring out negative connotations in the buyers or sellers minds? I have some guesses but would love to hear your feedback on the matter. It may be an opportunity for someone out there to change a paradigm.
     
     

If you were looking for someone to buy your home, who would it be? Well, I can not give you that answer today, but an article in the Real Estate Journal has 3 types of buyers that you should be very fearful of even in a slower market.
     
      It seems the longer you have your home on the market it attracts these types of buyers. We sold a home 6 years ago and attracted a bunch of them after the house had been listed for a couple of months. Instinctively, when they made an offer I had our broker counter with a tougher offer. The one buyer who wanted a 15 thousand dollar price cut and replacement of the 2 central AC units was my favorite on a 190,000 dollar home… He flipped when I offered back to replace the units, but the selling price had gone up to 202,000 dollars, screamed at out selling agent, and then went away.
     
      Well, enough about me, here are the 3 Home Buyers Your Should Never Attempt To Sell To:
     
      The Zero-Percent Down Buyer. If your home is setting a selling-price high mark for comparable homes “a mortgage company might find it challenging to appraise your house for buyers with little or no money down,” writes Corbett. “You’ll have to put your house back on the market again when your buyer’s mortgage request falls through.”
     
      The Bully Buyer. Nobody likes a bully and chances are you’re not going to like this type of buyer either. You will be inundated with a list of things that are wrong with house — all while presenting an offer. The inspection process? It will be a nightmare. If you detect a bully, move on. “This bully approach is a prelude to endless negotiations, and his or her trying to obtain concessions by nitpicking on the disclosure and the inspection.”
     
      The Sight-Unseen Buyer. You may get an offer from someone who has only seen photos of your house. But that can signal a trick up the sleeve. No one is going to buy a house without seeing it — this buyer just wants to tie up your house to take it off the market and make a decision later.
     
      via RealEstateJournal
     
     

We are seeing a lot of multiple offers on houses these days in St. Paul. The multiple offers are different than they were in 2002 through 2004. During those years a home would go on the market and some times there would be 4 or 5 offers on it in one day.
     
      Todays multiple offers involve writing an offer on more than one home for each buyer. I have talked to real estate agents around the metro and around the country and we are all seeing these multiple offers.
     
      No matter how a home is priced the buyers like to offer 10 to 20% less than the asking price. Sellers often reject these offers or counter them, with a lower asking price. The buyer won't go up enough and the seller won't come down more because they feel they have already reduced the price to rick bottom. There is a tug of war going on in the market with buyers saying your home is not worth that much and sellers saying no to the offers.
     
      A glance at the March 2007 numbers shows that on average sellers are getting 96% of the price that the home was listed at when it sold. The local news media is not portraying the situation that way, probably because it doesn't sell papers.
     
     

When Doug Thompson put his house in Big Lake up for sale last spring for $151,900, he figured many people would be attracted by the garage. At 1,100 square feet, it's bigger than the two-bedroom rambler attached to it.
      He was right -- the garage not only attracted a bunch of showings, but in only a week he also received competing offers, one for $158,000 -- $6,100 more than he was asking. But inside that offer was a qualification: He would have to pay $2,400 toward the buyer's closing costs.
     
      The second offer was for $100 less, and the buyer asked Thompson to pay about $4,000 in closing costs. Both offers initially were presented with lower prices, but when the buyers learned they had competition, "they both bumped their offers up quite a bit," he said.
     
      Some agents and lenders say deals involving buyers who ask sellers to pay some costs traditionally paid by buyers became more common this summer. In many cases, the home's price was boosted high enough above the listed amount that the seller got the contribution back at closing.
     
      Other professionals, though, say the proportion of such sales stays fairly constant. The essential ingredient is that an appraisal of the home must support the higher amount. Agents and lenders say that's rarely a problem.
     
      With Thompson's house, "The main reason both [buyers] made offers is because the husbands fell in love with the garage," said his agent, Shirlee Heitz of Dynamics Real Estate in Big Lake. But another reason was the relatively low list price, which tended to attract entry-level buyers.
     
      First-time buyers often are people with incomes and credit solid enough to get mortgage loans at this year's low rates, but they are strapped for cash to close the deal -- especially if they want to make 20 percent down payments to avoid the cost of private mortgage insurance.
     
      Asking sellers to pay closing costs while raising the sale price enough to cover those costs is legal, within certain percentage limits of the federal Real Estate Settlement Procedures Act (RESPA). People in the industry say the practice also is ethical, allowing well-qualified buyers who are short on cash to buy their first homes.
     
      Although the practice tends to boost sale prices, Hennepin County Assessor Tom May said the number of such sales is too small to affect real estate tax levels. Minneapolis City Assessor Scott Renne said his office makes appropriate adjustments.
     
      But a concentration of such sales eventually might affect the "comparables" used to guide pricing, potentially increasing overall home prices, particularly for first-time buyers.
     
      How it works
     
      Accumulating enough cash to buy a home -- particularly for a down payment -- long has been considered the chief barrier to home ownership. Veterans can buy with nothing down through the VA loan program, and FHA programs feature low down payments. But conventional mortgages generally have required down payments of 10 to 20 percent.
     
      In the past few years, however, conventional mortgage lenders developed loan programs requiring little or even no down payment for buyers with good credit. Closing costs for a purchase can be rolled into conventional loans, but such "no-cost loans" increase the balance and monthly payments, and most zero-down programs won't allow it, said Darin Heller, a partner in Advisor's Mortgage in Woodbury.
     
      Heller said buyers can't arbitrarily increase the amount to be borrowed. But they can alleviate cash-outlay problems by getting sellers to pay closing costs or "points," which can lower the mortgage rate. (A point is a form of prepaid interest equal to 1 percent of the loan amount.)
     
      Some buyers ask for seller contributions just to conserve cash. In a market favoring sellers, "typically that money gets added on to the bottom line," said Bob Clark, an agent with Lynskey Companies in Stillwater. "If a home is worth $200,000, the seller is not going to accept paying that $6,000 [in closing costs]; they're going to ask the buyer to add it onto the purchase price."
     
      He said the money generally is added during purchase-agreement negotiations. Usually, the buyer's agent brings a purchase agreement with seller-paid costs among the terms.
     
      Not all sellers are quick to say yes. "Sometimes the sellers fear that adding all of it on top will make the purchase price too high," so that the new total won't fit within the appraised value, said Heitz, of Dynamics Real Estate. "That's something you have to be careful of." She said she's had no such problems, partly because she checks prices of comparable homes every time a purchase agreement comes in.
     
      Making it legal
     
      Raising the price, with the seller getting the difference between the first and second prices, is legal. What is not legal is if the buyer receives cash back from the seller as part of a transaction, according to Lynn Leegard, Edina Realty vice president and corporate counsel. In an article titled "The Dos and Don'ts of Seller Contributions and Concessions" in the October issue of the company's newsletter, Leegard wrote: "Any and all financial arrangements between the buyer and seller must appear on the HUD statement and the lender must be aware of the terms." (The "HUD statement" is Form HUD-1, which lists who is paying what and to whom.)
     
      Loans have different limits for seller contributions.
     
      • VA: The seller can contribute up to 4 percent of the sale price toward buyer costs, plus discount points.
     
      • FHA: Maximum seller contribution is 6 percent, but "the buyer must have at least a 3 percent personal contribution to any combination of down payment and closing costs," said Edina Realty President Bob Peltier.
     
      • Conventional: "If there's less than 10 percent down on a mortgage, the maximum seller contribution is 3 percent" of the sale price, Peltier said. With a down payment from 10 percent to 24 percent, the seller's limit is 6 percent. If the buyer puts down 25 percent or more, the seller may contribute as much as 9 percent of the sale price.
     
      The area's two largest real-estate brokerages, Coldwell Banker Burnet and Edina, allow agents to make sales with seller contributions to closing costs.
     
      "Our policy is just that all copies of the purchase agreement have to be disclosed and distributed to all appropriate parties, which would include appraisers and everyone else, and that the closing statement must reflect the details of the purchase agreement," said CB Burnet Vice President Leonard MacKinnon. "That would include the original purchase agreement and any amendments."
     
      Edina Realty's policy "is to make sure we stay within the RESPA guidelines," Peltier said. He said that the rules aren't new, but that "until about 18 months ago, it never was much of an issue. It would come up once in a while when you had a cash-strapped buyer under VA."
     
      Summer surge?
     
      Whether more sellers than usual were paying closing costs this year seems to depend on who's asked.
     
      "There's no question it has been [increased lately], and I would say this year more than any year," Peltier said. "I think it's partially lender-pushed. Because of the number of lenders who have popped into the market the last 18 months because the market's so good, they're all looking to figure out a way to get the buyers to use them versus somebody else. We haven't seen as many of these since the market started to slow down."
     
      On the other hand, Mark Allen, CEO of the Minneapolis Area Association of Realtors, said that he recently asked brokerage office managers about the issue and that all but one said they had not seen any significant increase, just a possible a slight rise from a year or so ago. "It seems to be a trend with the objective of creating additional buyers, and if that's the case, that's good," he said. Most of the managers told him the practice is most common among first-time buyers purchasing homes for less than $200,000.
     
      "Sellers paying buyers' expenses is not as common now as it was in the 1980s, when they were paying points to buy down the interest rates," Allen said. Now, sellers are "paying closing costs on the buyers' behalf, which helps those buyers who are cash-skinny."
     
      Based on his own business, Clark estimated seller-paid costs are occurring in less than 10 percent of sales.
     
      Heitz said she's seen more such deals this year, starting in spring. Mac Kinnon said that companywide, summer contained no big change.
     
      At Wells Fargo Home Mortgage, the proportion of loans with seller-paid costs hasn't changed, said area manager Doug Winter. He estimated that less than 10 percent of mortgage loans include such terms, and that 90 percent of those are to first-time buyers. He said seller contributions to the price will be noted on the appraisal and on the loan documentation. He said underwriters have no problem with this if the appraisal covers the contributions.
     
      "We rely on the creditworthiness of the buyer, as well as the appraisal to make the loan decision," he said. If seller-paid costs were forbidden, "we'd find fewer people owning homes." He said seller-paid costs would be more common without programs for 100 percent financing or "80-20" loans, which avoid mortgage insurance with a first mortgage of 80 percent of the price and a second mortgage for 20 percent.
     
      Brokers noticed an increase in seller-paid costs this summer, said Tom Birch, ABN AMRO executive vice president.
     
      "Two years ago, we were seeing very little of it because the market was so hot and there weren't enough listings. Sellers would just say, 'Pay me my money.' " But in the past six months, "sellers have to work a little harder to get their homes sold because there's more competition."
     
      Birch said sellers are paying costs in two ways:
     
      "On conventional loans, we're seeing sellers paying points -- about two points -- or paying the closing costs to help the buyer. On FHA loans, the program we're seeing the most is called AmeriDream. FHA doesn't allow the seller to give the buyer a check for closings costs, but the seller can pay the 'gift' to AmeriDream -- an approved 'gifting' agency -- and AmeriDream gives it to the lender for the down payment."
     
      Birch said that only a small percentage of FHA loans are being made with seller-paid costs, but that for conventional loans, "we're seeing some now; we weren't seeing any before. As we continue to increase in inventory, I think we'll see more of this as a way to sell houses."
     
      Mortgage broker Heller works heavily with first-time buyers and estimates that sellers make some contribution to half of them. But he urged caution. "We are not in favor of inflating the price to cover closing costs; we have no desire to originate a loan that's going to be problematic." He said appraisals have to be within tolerances, or "you might have an underwriter request more 'comps' or cut the value of the appraisal."
     
      A clue to costs
     
      A clue as to whether the reported sale price contains seller-paid costs can lie in the real estate broker's commission.
     
      "Within the industry, you can find instances of both a commission being paid on the original purchase price and a commission paid on the amended purchase price," MacKinnon said. He said CB Burnet has no policy about this other than full disclosure.
     
      Peltier said that when seller-paid costs are included when the purchase agreement is negotiated, the commission is charged on the entire reported sale price. But if buyers who have signed a purchase agreement find themselves short of cash and come back to negotiate seller-paid costs -- usually done as an amendment to the purchase agreement -- "chances of our getting [a higher commission] are slim to none; we don't ask for it." He said raising the price after signing the purchase agreement is rare.
     
      Seller Thompson had no qualms about meeting the buyer's terms.
     
      "As long as their financing went through, I was great with it," he said. He paid commission on the full $158,000 and "had no interest in trying to pay less. If [the buyer] had just bumped his price up $2,400, I would have liked it, but when he went $6,000, I was fine with it. In the end, I wound up with more money than I was asking."
     

can't write this post without including language on what agency is. The five kinds of agency relationships in real estate recognized by the state of Minnesota:
     
      Seller's Agent: representing and acting for the seller only. May be a listing agent, or any REALTOR® licensed to the listing broker, or a selling subagent.
      Subagent: a broker or salesperson who is working with a buyer, but represents the seller.
      Buyer's Agent: representing and acting for the buyer only. As with a listing contract with sellers, an agreement for buyer representation must be in writing.
      Dual Agent: one licensee representing both the seller and the buyer as clients in one transaction, or two agents licensed to the same broker, one of whom represents the seller and one of whom represents the buyer in one transaction. This requires full disclosure and informed consent of both parties. Dual agents have a limited role, must not advocate or negotiate for either party, and must not act to the detriment of either party.
      Facilitator: a real estate licensee who works for a buyer, a seller or both in a transaction but does not represent either in a fiduciary capacity as a Buyer's Broker, Seller's Broker or Dual Agent. Facilitators may perform services for consumers, but do not represent them. Facilitators are bound by license law and common law, but owe only the fiduciary duty of confidentiality unless other fiduciary duties are agreed to between licensee and consumer.
      Buyers and sellers both like to ask me if I am a buyers agent, or a sellers agent. Some of these conversations have revealed some mis-information about dual agency. Dual agency happens only when an agent, or the agents broker, or more than one of the brokers agents are working on behalf of that broker and representing both parties in the same transaction.
     
      I am both a buyers agent and a sellers agent. I do encounter situations where I am asked to do both. I prefer not to, but I can and under some circumstances I have. When I do both buyer and seller get to listen to my dual agency speech. In general when I am acting as a sellers agent or listing agent I represent the sellers and when I am working as a buyers I am representing the buyers.
     
      As an agent I find that having both experiences on a regular basis is an asset. When it comes to negotiating an offer no matter which side I am representing I have a clear understanding of what the other party might want, or how they might be feeling about it all.
     
      Real estate is about people and buying or selling property is a large and important transaction, and there are always emotions involved. Having experience with sellers helps me advise buyers and having experience with buyers helps me advise sellers and understand how to market their home. I can see the home through the buyers eyes, just as I can see the buyers offer from the sellers point of view.
     
      If I were choosing an agent I would not consider it an advantage to work with an agent that only represents buyers or one who only represents sellers. I would consider it an advantage to have my own agent representing my best interests instead of an agent who is operating in the dual agency roll and representing both parties. Like it says above:
     
      "Dual agents have a limited role, must not advocate or negotiate for either party, and must not act to the detriment of either party."
     
      Buyers who go from open house to open house or the agent listed on each sign, to see each home, run the risk of working with an agent in a dual roll. Get your own agent.
     
     

Maybe you didn't get the memo...money DOES grow on trees.
     
     
      I have always believed that a property with trees has more value then one without. After being a real estate agent and working with many home sellers and buyers, I have found that buyers, for the most part, like a home with grown trees. Studies are now showing that well placed thriving trees can add as much as 15% in increased value to your home. Not only are trees pleasing to the eye and add great curb appeal, but they also help to reduce your heating and cooling bill by offering shade.
     
     
      I grew up on a couple acres which had probably 20 trees that were 40+ years old. As a kid, I loved swinging from the limbs or climbing as high as I could. In the fall, we had two huge red maple trees that were beacons in the neighborhood once the leaves began to turn a brilliant red. Since then, I am always looking for that perfect property that has well placed trees and different varieties. Just like a gardener who plants flowers of different colors and heights, it is just as important to offer variety in the trees you pick.
     
     
      Over the last two decades, home developers have been going into areas and clear cutting every tree in site. What they are now finding out is that home buyers want some trees to remain in the yard, giving the property a more "natural" appearance. Covenants are even being created where trees of a certain diameter cannot be removed without permission. People are starting to finally see the value of trees. Yes, it might be a pain to rake up the leaves in the fall, but I sure do love to hear the leaves rustle in the wind or have a picnic with my family under the far-reaching branches!
     

Andover real estate has been in the news lately because people who know are flocking to this quiet, residential oasis. And now, there are new funds available to help homebuyers come and buy a home in Andover, Anoka County MN.
     
     
      The Anoka County Community Development Department has recently informed the City of Andover that first time home buyer money will be available soon. They will receive applications from individuals living in Anoka County who fall under their income limits and has not owned a home within the last 3 years. The program will start in April.
     

One can’t pick up the newspaper or watch the news without reading or hearing the heart- breaking stories about the increase in foreclosures in the State of Minnesota and the negative impact it has on families and communities. Neighborhood Development Alliance (NeDA), a non-profit housing program located on the West Side of St. Paul, has also seen an increase in the number of families seeking foreclosure prevention counseling. NeDA has noted that 98% of the families coming in for foreclosure prevention counseling had little or no understanding of the home buying process. All of the families seen were Spanish speakers who did not know or understand: the loan product they received or the terms of their loans; the condition of the property they purchased; the fact that the homes in many situations were overpriced; that the financing received was (for example) an 80/20 with two separate mortgage payments which did not include property taxes and insurance; or an adjustable rate mortgage with pre-payment penalties.
     
      Although all of these families were assisted by someone who spoke their native language, they were not given all the information necessary to make the right decision when purchasing a home. For this reason, NeDA continues to offer HomeStretch workshops to help families understand the “ins & outs” of homeownership before meeting with a realtor, lender or broker. NeDA also provides housing counselors who can meet with individuals and/or families who may need to work on credit issues, a savings plan or a household budget before considering homeownership. As a non-profit housing program, NeDA is independent of both real estate and lending institutions.
     
      If you are thinking of homeownership, consider the “HomeStretch” workshops as the first step toward your homeownership goal. The workshops are designed for first time home buyers; we charge a minimal fee of $35.00 for the household to cover material expenses. By attending the nine-hour HomeStretch workshops and/or meeting with a housing counselor, interested homebuyers will walk away with quality information regarding the home buying process. You will understand how to work with a lender, broker or realtor, and what their responsibilities are to you, the consumer. You will understand that one housing professional should not “take care” of everything for you! You will understand the importance of paying for an inspection, and the fact that if you don’t pay for an inspection it could cost you more money later on. You will understand that there are many mortgage products available and which ones to stay away from. You may even complete the workshops and decide you need to wait a year or two. Our job is to guide you through this confusing, often complex and emotional process of buying a home, by providing you with accurate information so that you make the right choice for you and your family without any pressure.
     
      NeDA offers the workshops in English and Spanish; for a complete schedule go to www.nedahome.org or call 651-292-0131 for more information. Additional workshop information can be found through the Minnesota Home Ownership Center at www.hocmn.org.