know when to reduce the price

downtown st. paul
Downtown St. Paul

Even in a hot seller’s market homes can be overpriced. 66% of the homes that sold last year had at least one price reduction while they were on the market. On average 2017 home sellers got 99.6% of their asking price.

Most of the homes that were sold without a price reduction sold quickly but there were some exceptions like the home that was on the market for a year before it sold.

Properly pricing a house is more of an art than a science. Ultimately it is the buyer who sets the price.

Knowing when to reduce the price if the home is priced too high is priceless.

Apparently we are not getting any younger

The population of the twin cities isn’t getting any younger. We are getting older.

FACT: 60,000 Minnesotans turn 65 this year, next year and every year through 2030. Soon 25% of our adult population will be 65+ [Facing aging MN]

The counties with the lowest average age in Minnesota are the counties that make up the metro area.

the number 25 is important to remember because, by 2025, 25% of the population of Ramsey County will be 65 or older.  That is exactly like one in 4. In just two years 22% of the population of Ramsey County will be 65+ years of age.

It is easy to blame baby boomers for this but I would be more inclined to blame the parents of baby boomers if someone needs to be blamed. What were they thinking?

It is also important to understand that people who are over 50 move far less often than those who are under 50. I believe that part of the reason for the shortage of homes for sale has to do with a population that has aged past the prime moving years.

My own parents will both turn 90 this year. The 90 to 94-year-old age group is the fastest growing age group.

Aging in Ramsey county
Ramsey County & aging – source “Face aging MN


SRES Designation – Senior Specialist

I had a little spare time this December and decided to use it wisely. I took some classes and passed the test and got the “Senior Real Estate Specialist” designation (SRES), through the National Association of Realtors.

I have worked with many older home buyers and sellers over the years, including my own parents who bought their last home when they were almost 80 years old.

Moving isn’t easy and it can be especially hard for those who have lived in the same house for a lifetime. There is a process that has changed over the years and a transition that has to be planned for. Through the SRES courses, I got access to resources and ideas that I can use to better support older home buyers and sellers.

When my parents had to move (they were unable to plan ahead)  I took take care of everything and I learned a lot in the process and I have been able to share that experience and what I learned in the classes with my clients and their families.

SRES logo
Senior Real Estate Specialist

Proposed tax bills and real estate

I am going to limit my commentary to the part of the Federal tax bill that directly impacts real estate. For St. Paul homeowners the sky is probably not falling. Yes, the mortgage tax deduction is being limited to interest on the first 750K

The majority of mortgages are less than 750K and here in St. Paul where the median home value is around 200K most will not be affected by the changes in the MID.

The first 10,000 paid property and state taxes will also be deductible for those who qualify. Property taxes in St. Paul are 1.33% of the assessed value of the property. State income tax rates range from 5 to 10%. Most middle-income households are going to be in the 7 to 8%  range. [see the best run states]

With the standard deductions being raised fewer will qualify. Currently, there are many homeowners who do not get any tax benefit from owning a home because they do not itemize and the reason they do not itemize is that the standard deduction is higher than the total of all possible deductions added together.

The incentives for incurring more mortgage debt will be gone for some. It is even possible that owning lake homes in Minnesota will become less popular and the values will decline.

There are some advantages in having less mortgage debt. Money can be invested in other things. Maybe some will start a business rather than owning a lake home and take advantage of business tax cuts.

Most homeowners I know love owning a home but I think new tax laws will impact the housing market. Taxation has intended and unintended consequences. I think it is important to keep it all in perspective.

Multi-generational homes

Having a couple of a few generations living under one roof must be like having Thanksgiving every day. It seems like the idea of multi-generational living was the most popular during the recession.

Student loans debt has made it more common for people to live with their parents for an extra decade. In another decade or so the tables may turn. Elderly parents will be living with their college graduates.

Here are some statistics put together by the National Association of Realtors about multi-generational home buyers.

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Multi-generational housing


How to get your mother’s house ready to sell

green carpet
Green sculpted carpet

I sold my parents home a few years ago. I moved them out first and then figured out what to do with their excess stuff.

It seemed overwhelming at the time but I have helped clients through this process and selling houses is what I do. There were some legal issues too. I can not give my clients legal advice. I consulted with an attorney who specializes in Elder Law.  I used my durable power of attorney which included the power to sell their real property.

One of the challenges of selling a home that is or was owned and lived in by an elderly person is making it look as appealing as possible to younger home buyers. Sometimes the homes look as if time stood still.

The first hurdle can be getting the owners to give up some decorating choices they made long ago. My mom doesn’t know that I had the wallpaper border removed from the kitchen, and repainted or she would be upset about it.

Often “grandma’s” house is in good repair and is an excellent opportunity for first time home buyers to fix some of the cosmetics and build equity.

As a seller, I don’t want to put any more money into the home than I have to. Here are some of the things I did that were fairly inexpensive that helped sell grandma’s house:

1. Clean everything

2. Repaint in light neutral colors.

3. Replacing old drapes with sheers in shades of white.

4.  Replacing any window shade or blind that was anything other than white or just remove them.

5. Buy new shower curtains, towels and coordinating rugs for the bathrooms for staging. 

6. Replace light fixtures and shades.

7. Remove wallpaper and paint walls.

8. Remove worn carpeting to expose hardwood floors. It is better to have wood floors that need a little work than worn carpeting.

9. Remove worn linoleum and replace.

The list isn’t really prioritized by importance but it is in order of how much the project is likely to cost. It is important to have a budget and to stick with it. If the improvement won’t help sell the home faster or for more money it isn’t worth doing. The smallest improvements that give the greatest payback. Cleaning and painting have the highest ROI.

Removing a wallpaper border can have a tremendous impact. Putting a new backsplash in the kitchen can also have a high return on investment. Consider new switch plates and don’t forget t clean light fixtures.

It is also a good idea to have furnace or boiler serviced and have any repairs were done that are needed. As a rule, anything that leaks should be fixed and there are usually other obvious repairs too.  Sometimes small maintenance issues result in low offers.