Minnesota First Time Home Buyers » Neighborhoods and Communities

MN Summer Real Estate Info

Steve Howe — Fri, 13 Aug 2010 09:48:52 +0000

Well the MN State Fair is only a couple weeks away, and I have some information on the summer real estate market in the twin cities area.

This video is put together by the MPLS area association of Realtors.

There have been some interesting things happening in the housing market–namely less buyers out there than we normally see in the summer. What that means for sellers is that they will have a tough time finding a buyer. What that means for buyers is that they will have their choice of houses because of a continued higher-than-normal inventory and lower demand.

In a nutshell: if you’re a first time home buyer in MN you have very little competition!

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Housing Inventory for First Time Home Buyers

Steve Howe — Mon, 22 Feb 2010 18:43:50 +0000

Two statistics we use to analyze the Twin Cities Housing Market are “Inventory of Homes for Sale” and “Monthly Supply of Inventory”. These typically help sellers determine what a realistic timeframe is for the listing and eventual selling of their home because it gives them a sense of the number of homes on the market and how long it will take for those homes to be sold.

Buyers can also use these statistics to help them determine what kind of competition they have for purchasing homes. By looking at the # of homes available in a certain price range and also what the estimated monthly supply of those homes are, buyers can see if they have a lot of homes available to purchase and how fast those properties might disappear to other buyers.

Since we’re in February 2010 I thought I’d share the latest numbers with you so you can see that in the First Time Home Buyer price range we are seeing a shortage of homes available. For our purposes we’ll stay below $150,000 since the majority of 1st time homebuyers will be buying a home in this range. We’ll also limit the numbers to single-family detached homes (which excludes townhouses and condos).

Inventory of Homes for Sale

Feb 2009 – 4,234
Feb 2010 – 2,869

(drop of 32%)

Monthly Supply of Inventory

Feb 2009 – 6.2 months
Feb 2010 – 2.95 months

(drop of 52%)

So what does all this mean? Basically the numbers of homes available for first time home-buyers is shrinking. This is happening for a couple of reasons. First Time Buyers, along with investors, are looking for cheaper properties. So the inventory is being bought up by a few different groups of people. Banks are also limiting the number of vacant foreclosed houses they allow to be put up for sale, to control the supply/demand ratio and create bidding wars when they list new properties.

After the April/June Tax Credit deadline, I personally anticipate there to be less demand for homes, which will hopefully make it a bit easier for buyers to purchase their first property in these lower price ranges. There are also statistics that suggest another wave of foreclosures may be coming in the next year or two, due to Adjustable Rate Mortgages increasing their interest rates which will make the payments too high for their home owners.

We’ll have to wait and see what happens with those. But for now, we know there are less homes available and more demand out there for first time buyers.

(All numbers are via the Minneapolis Area Association of Realtors)

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February 2010 Monthly Skinny

Steve Howe — Sat, 20 Feb 2010 21:29:54 +0000

Here’s another snapshot of the Minneapolis and St. Paul area housing market, courtesy of the Minneapolis Area Associattion of Realtors.

They call it the “Monthly Skinny” report.

(note: I suggest pausing on each slide to fully read the numbers displayed)

What To Look For In A Neighborhood

Steve Howe — Sun, 27 Dec 2009 14:24:47 +0000

Many Minnesota First Time Home Buyers often ask me “what do we want to look for in a neighborhood?” This is a very good question, and while everyone prefers a little something different for their surroundings, there are a few key factors that should go into making the choice of where to search for MN properties.

I’ve made a short list of things to look for when evaluating a neighborhood, and I’ve also written a little detail on each item so you can judge how important it is for you.

Crime/Safety

This is probably the #1 thing most people are concerned about when house hunting, and deservedly so. You obviously want to feel safe around your neighbors, and checking the local crime statistics online can help you determine what sort of place it is. I would also recommend taking a walk and/or drive around the neighborhood at a couple different times of day and night, just to see if there are suspect people roaming the area.

Pride of Ownership

This is one of those “intangibles” that you’ll want to looks for in a neighborhood. Areas with a higher percentage of Owner Occupants (non-rental homes) are typically nicer to live in, since people are invested financially and emotionally in their homes. Are the houses well-kept, or are their lawns overgrown and ugly? Are their excessive toys or junk in the yard? Basically, does it look like people enjoy living here and take care of their community? If not, you may want to look elsewhere for a home.

Schools and Education

This is another important aspect, especially for buyers who have school-aged children. Sometimes there is too much stock put into which school district a house is located in, but in a lot of cases it is meaningful to match your students with the right school. The main things to be aware of are the safety of the schools, graduation rates, extra-curricular activities offered, and school budgets. Don’t worry about getting into the top ranked district in the state, just try to focus on the needs of your students and their learning methods.

Proximity to Work

Since we Americans spend about 40-50 hours a week at our jobs, it’s important to be somewhat close to our workplaces. When looking for a new home, keep in mind the time it will take you or your spouse to get to work, and also which routes you’ll take to get there. Major projects are always going on somewhere in the metro area, and you should make sure you have some options that might help cut your commute time down.

Proximity to Friends/Family

You obviously don’t want to isolate yourself from your loved ones, so take into account where your friends and family live and work. You’re likely to make friends with neighbors and other people around the area, but don’t cut yourself off from existing relationships if getting together with friends and family is important to you.

Shopping and Restaurants

Shopping doesn’t just have to mean retail and department stores. Take into account the nearest Target, Wal-Mart, Cub Foods, Rainbow Foods, Home Depot, Menards, Walgreens, CVS, and any other stores you regularly shop at. It’s also nice to have some dining options close by for those times you need to get out of the house. Most people have cars to drive to these stores across town, but it’s much nicer to find a home that is close to some of these modern day necessities.

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Crunching The Numbers

Steve Howe — Tue, 03 Nov 2009 21:16:20 +0000

Most of us learned a little about Supply and Demand back in school. I even remember doing a mini-musical about simple economics in 6th Grade Social Studies. And yet the concept of Supply vs. Demand gets lost in emotion and motivation when looking at buying a home.

I wanted to take some time today and analyze a few housing numbers from the Twin Cities area for your benefit. There’s an old thought that goes something like, “once something is popular, it’s already out of style” which means if you wait until everyone else jumps on the bandwagon first, you probably won’t have any room to hop on yourself.

That’s a little bit similar to what the Twin Cities Housing Market has been like for First Time Home Buyers this past 12 months. Back in the winter of 2008-2009 it wasn’t trendy to buy real estate, but after the 2009 Obama Stimulus Bill passed in February 2009, which included the $8,000 Home Buyer Tax Credit, it became popular to go house hunting for your first property.

With the Tax Credit Deadline of Nov. 30th, a lot buyers waited until late summer or early fall to act, which meant there was a lot of competition in lower price ranges. While a lot of new buyers thought they were going to get a great deal and close fast, they were rudely greeted by a swarm of buyers and shrinking inventory, which added up to a ton of headaches for them (and their agents).

So here’s the scoop – the numbers will tell the story of why it’s been such a crazy market for the past few months. The summary: more buyers, less houses.

For the full report visit the MPLS Realtor Site here. All data by the Minneapolis Association of Realtors.

RED – 2008 BLUE – 2009

(Note: since most first time home buyers will be buying under the $150,000 range, we’ll focus on those price points)

Number of Homes on Market – October 2008 and 2009

Months Supply of Homes on Market – October 2008 and 2009

Number of Homes Sold – October 2008 and 2009

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Chanhassen MN is 2nd Best Place to Live

Steve Howe — Mon, 13 Jul 2009 16:06:40 +0000

CNN.Money has come out with it’s annual national rankings of the “Best Places to Live in the America” once again this year. For the second straight year, a Minnesota metro suburb has made it in the Top 3.

This time around Chanhassen, MN was ranked as the 2nd Best Place to Live in the country due in large part to it’s close proximity to Minneapolis and its wide range of outdoor nature areas.

See the full list and read the entire article on Chanhassen at their website.

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Is Real Estate Hot or Cold?

Steve Howe — Tue, 14 Apr 2009 02:26:26 +0000

I love helping buyers find the right first home. In fact, that’s about 90% of my business – assisting First Time Home Buyers with the process of home buying. But often times I get strange questions from young buyers; those who are astute and listening to the news about the Housing Market.

They ask me, “Have we hit rock bottom?” “What if the Prices dip lower still?” “I heard that Banks will give away Foreclosed properties, is that true?” “The news said the U.S. Market is still in bad shape, are they right?”

And that’s when I have to stop them. Not because they said anything wrong or offensive, but because any news about the “National Housing Market” does not have a thing to do with the local Twin Cities Market.

Alec Grebis who writes a ton of First Time Buyer Loans wrote a great article on why you should not listen to reports on the National Average, or Housing News about the U.S. as a whole.

His basic analogy is this:

You wouldn’t listen to a statistic that said “The Average High Temperature in the U.S. was 58 degrees today” because that would tell you very little about what the weather was like where you live.

The same goes for housing. San Francisco Real Estate and Fargo Real Estate have very little to do with Farmington Real Estate, or even Fridley Real Estate.

It’s a very good analogy, and if you want to read the whole story, visit the First Time Buyer Loan Blog.

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Suburbs or City Living?

Steve Howe — Tue, 17 Mar 2009 04:58:55 +0000

I love meeting new buyers and chatting with them about their needs and wants in a house. In addition to the style and characteristics of a house, we talk about Location, which is still the 3 most important things in Real Estate. It seems like when I talk to a lot of First Time Home Buyers in the Twin Cities about Location, a lot of them don’t want to live in the actual cities of Minneapolis or St. Paul.

Every now and then if I get this response, I like to ask them “why“?

The most common objections to living in a one of our two Twin Cities are:

Crime Levels
School Districts
Lot Size

What’s somewhat ironic to me is that in most cases these 3 factors don’t really come into play with your first home.

Statistics show that people in the U.S. move about once every 7 years on average. For First Time Buyers, they usually only stay in their first house for 3-5 years.

Of course, everyone’s case is unique and that’s one of the fun parts about being a Real Estate Agent. But if we follow this law of averages, then we could probably help debunk some of these objections to City Life.

Number 1: Crime Levels. The first thing people think of when they hear “Crime” and “Twin Cities” is North Minneapolis. Call it a stereotype or just plain truth, it’s what’s on most people’s minds.

What if I told you not ALL of North Minneapolis is crime-infested? What if I told you I lived in North Minneapolis? What if you actually found a house you liked in North Minneapolis? Would you think about buying it?

The truth to crime in the city is the same for all areas in every town across the world – there are good pockets and bad pockets everywhere. Some blocks might be fine and just a few streets over you have trouble every week. It’s all about your local neighborhood and in some cases the people who live on your block.

It’s probably a fact that Minneapolis has a higher crime rate than most suburbs around it, but that’s not a true measure of the safety in a Location. I’ve seen plenty of Suburban neighborhoods and communities that are not very safe, so just being in the ‘burbs doesn’t mean you’re crime-free.

Before buying your home or settling on an area make sure you search the city websites for crime statistics and compare them for yourself.

Number 2: School Districts. These are important for parents as we all know, but when you’re buying your first house do you really need to care a lot about the school districts in your area? Unless you already have school-aged kids (at least 5 years old) or plan on staying in the home until your children are school-bound, you probably don’t need to worry about the types of education down the block.

Let me rephrase: the schools shouldn’t be your deal breaker if you love everything else about the property. Remember that this is just your first house, and chances are you’ll probably move into 4 or 5 more homes within your lifetime. If you’re thinking about raising kids for several years in the house then spend some time and effort into finding the right schools for your family. However just because you hear that schools are important on the news doesn’t mean you need to worry about being in the #1 District in the State – especially if you don’t even have kids!!

Number 3: Lot Size. Seems like everything we want in America these days is bigger and better than what our parents had, right? And that includes Lot sizes. It’s not abnormal to see a half acre lot in the suburbs of Minneapolis. However you’d be hard pressed to find that large of a plot of land in the city limits. So what’s the big deal about having a bigger lot anyway?

Pros: Your neighbors aren’t breathing down your neck. You have more space to play and landscape. Your property value goes up if you have more land.

Cons: You are further away from your community and may not have sidewalks for your kids to be safe on. You have more area to maintain and up-keep with lawn care and snow removal. And since you have more land, your property taxes will be higher.

As you can see, there are pluses and minuses to buying in the city. For some people, they were raised in the ‘burbs and can’t imagine themselves in a 1930 built home that doesn’t quite live up to today’s Massive Mansions. For others, they may want to delve into the walking communities that city-living can provide.

It’s a personal choice you should make with the help of your agent, and try to be open to all possibilities especially if you’re budget is less than $200,000. City Living may be all you can afford…for now.

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‘Tis The Season of Giving

Steve Howe — Tue, 09 Dec 2008 01:42:16 +0000

So I don’t normally write about a lot of personal matters, since my focus is providing you with the best knowledge possible about real estate and buying your first home. But I thought I would just take a minute and remind people that it really is better to give than receive.

Two things happened this past week that made me feel good, and both of them were giving – not receiving.

The first: I donated blood at the Red Cross in Minneapolis for the first time. Sure, back in college I used to give blood plasma for money, which helped with the bills and cost of college living. But I had never just given blood to use for people who come into the hospital in need. So, I did last week.

And you know what, it felt great. I don’t know exactly where my donation will go or who will benefit from it, but I do know that I may have made a difference in someone’s life.

The second: I shoveled my neighbor’s walkway after it snowed. I know that’s a small thing and only took about 20 minutes to do, but I’m sure he was surprised when he got home and saw his sidewalk and front steps cleared. I also went down the block and shoveled the vacant house’s sidewalk, so that people traveling by foot wouldn’t have to tromp through the snow.

I believe those sorts of things are what home ownership is all about. It would be easy for me to say to myself, “I don’t own that house, so why should I help maintain it?” But when you’re a first time home buyer – or any homeowner for that matter – you don’t just live alone in the community. We’re all in it together, and especially in these tough times it’s better to band together and help each other than keep to yourself and be closed off.

So I hope you’ll choose to give something this Holiday season. Whether it’s snow shoveling, gift donation, or just a few hours of your time volunteering, I promise it will make everyone’s day a little better.

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Plymouth, MN “Best Place to Live” in America

Steve Howe — Thu, 27 Nov 2008 05:32:31 +0000

Recently CNNMoney.com did a wide ranging series on the best places to live in the country. For many of us living in the Twin Cities metro area, it was no surprise that one of our own cities was named the “Best Place to Live” in the U.S.

The article cites Plymouth, Minnesota’s great schools, wonderful parks and recreation, along with still affordable housing compared with that of other top placing towns such as Naperville, IL (Chicago suburb), Irvine, CA (near Los Angeles), and Ellicott City, MD (between Baltimore and Washington D.C.).

On a personal note, my wife grew up in Plymouth and every year we still have family get-togethers in the best small city. However, it’s not the only great place in the metro region, of course, depending upon what’s important to you. You can’t quite get that downtown feel out in Plymouth, or even the total serenity of having a couple acres to yourself.

Still, the western suburbs are a great place to settle down or live it up in Minnesota. Make sure you research any new neighborhood with the help of a licensed REALTOR®.

If you’re contemplating a move sometime in the future, have our team help you out with your search for homes and community information.

For the complete CNNMoney.com article click here.

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Minnesota First Time Home Buyers » Neighborhoods and Communities

MN Summer Real Estate Info

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Housing Inventory for First Time Home Buyers

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February 2010 Monthly Skinny

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What To Look For In A Neighborhood

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Crunching The Numbers

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Chanhassen MN is 2nd Best Place to Live

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Is Real Estate Hot or Cold?

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Suburbs or City Living?

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‘Tis The Season of Giving

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Plymouth, MN “Best Place to Live” in America

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