Beware of the senior specialist

My parents are 90 years old each apiece. I have dealt with numerous “senior services” over the years. This is from the Minnesota Attorney Generals web site:

Beware of “Senior Specialists.” Fraudsters may imply a certain level of training on issues important to people 55 and older to give you a false sense of security, however, this “training” may be nothing more than a sales tactic. “

There is some truth to this especially when it comes to senior housing.

There are housing advisors who are paid by the companies that have properties to lease.

There are also people like me who make money when we sell real estate and can earn a “Senior Real Estate Specialist” (SRES) designation.

The program is through the national association of Realtors. I am a sales person and there isn’t anything wrong with that unless I pretend to be something else.

I do have actual experience working with seniors and I like to be able to use that experience to help others but the help I can provide is limited to all the details involved in buying or selling real estate.

There is one thing that isn’t taught in the Senior specialist’s classes and that is about Senior LinkAge Line.  It is free and is part of the Minnesota Board on Aging They are not salespeople and do not make money when someone moves.

Seniors who are trying to decide if they want to move to senior housing or sell their home or buy a home should start with a call to Senior Linkage line rather than consulting a real estate agent or a lawyer first.

Sometimes seniors and people of all ages ask for advice on the internet and give away a lot of personal information about themselves and their property to total strangers. It would be much better to call Senior LinkAge Line.

Regular readers may even have noticed that contact information for Senior LinkAge Line is prominently displayed in my right sidebar and has been there for years.

July real estate market

On average St. Paul home sellers got 100.7% of their asking price in July 2018 which is slightly more than the 99.9% average for the Twin Cities region. In the West 7th neighborhood of St. Paul the average was even higher at 101.2%.

graph
Asking price Vs. sale price

When the average sale price is higher than the average listing price that generally means prices are going up. It looks like prices are going up the most in the Thomas Dale neighborhood where homeowners got almost 102% of their asking price on average.

Condo sellers got an average of slightly less than 100% of the asking price for their units with downtown St. Paul condos selling for 98.7% of the asking price.

Home buyers should not use these numbers as a guide when making an offer.

real estate really is local

 

Real estate is local. That doesn’t mean that what is happening in other cities won’t happen here.

Over the weekend there were news stories about the housing market slowing. It was about parts of the country where the rise in home prices has slowed considerably and the number of homes on the market is growing.

Here is St. Paul we have more houses on the market than we had a month ago. Yet if our inventory of homes for sale grew by 300% we would still have a shortage of homes for sale.

We are still seeing multiple offers for more than the asking price especially for homes priced under $250,000.

There is a little evidence that home prices are softening. There have been more price reductions lately.

Housing prices are ridiculous in parts of the country and in parts of St. Paul too. I think increases in home values will start to slow down especially as interest rates slowly rise.

I have seen national headlines that suggest we are in for the biggest slow down ever in the housing market. That sounds ominous yet if you look at how hot the real estate market has been it does seem like something needs to give.

I’ll have some local real estate numbers next week. Here are the numbers for June 2018

No I can’t let you in

Sometimes when I am showing houses in the city people will come in off the street and try to tour the house with me.

They do not seem to understand that if I am showing a buyer a home that is for sale I can not give anyone else access to the house.

When I tour a house with a buyer that is because the seller has given me permission to do so. That permission does not extend to anyone who walks in off the street.

Newer agents do not always understand this and neither do people who see homes for sale and are curious about them.

The best way to see homes for sale is to call your real estate agent and set up a private showing or attend an open house if there is an open house.

In some neighborhoods, if the buyer waits for an open house it may be too late as the house may already have an offer on it.

A for sale sign is not the same thing as an open house sign.

I have had people try to follow me into the house and I have had neighbors knock on the door while I was showing a home.

 

 

Artificial deadlines for offers

greek revival
Greek Revival style

Everyone who is buying or selling a home knows that they go pretty fast and some homes sell with multiple offers. In the last couple of days, I have encountered a couple of situations where real estate agents have set a deadline for offers but there were no offers.

If you are a real estate agent or a home seller you need to know that there is a huge difference between someone saying he/she is going to make an offer and actually getting an offer.

Let me repeat it. There is a huge difference between someone saying he/she is going to make an offer and actually getting an offer.

Generally, there is no deadline for making an offer on a home that is on the market. If someone makes an offer and there are other interested parties then there is a reason to create a deadline.  Deadlines are needed when there is an offer on the table or the offerer may decide to withdraw it.

Creating an artificial multiple offer situation can result in no offers because some buyers do not want to compete in multiple offer situations.

Let me repeat this. There are buyers who will not make an offer on a home if others are also making offers.

An agent recently called me to tell me that one of my buyers may be interested in his listing but he has an offer but if my client can look at it right away and make an offer they will extend the deadline for highest and best offer. Nice!

Home sellers can only accept one offer and if it is a good offer they might want to accept it before the offer gets away.

Make sure you list your house with an agent who knows how to handle multiple offers. It could mean the difference between getting multiple offers or not.

The inspection period explained

Ten-day inspection periods are common. The buyer makes an inspection contingent offer on a home. The inspection period starts the day after the final acceptance date on the purchase agreement.  If there is no final acceptance date then I guess the ten-day period could start anytime.

During that ten-day period a few things need to happen:

  1. The buyer has inspections and tests done at his or her expense.
  2. The buyer decides if they will ask for repairs or not.
  3. If the buyer asks for repairs the seller reviews the repairs and responds with a yes, or a no, or a counter of some sort.
  4. Both parties agree in writing to the repairs.

That is why it is important to get the inspection done as soon as possible or ask for a longer than 10 day inspection period. If the ten days run out before there is an inspection then technically the buyer just bought a home.

I do everything I can to make sure no one is buying a home without an inspection no matter which party I am representing.  However, I don’t make up the rules or the laws and it is up to my clients how they want to handle all of this. I can only advise them.

Sometimes the inspection is all done but one part or the other needs to research the repairs and get a price. As I have mentioned before sellers should not commit without knowing if they can get the work done or how much they will cost. Negotiations will need to go beyond the stated inspection period.

If extra days are needed for research the inspection period can be extended if both parties agree and sign an amendment.

Occasionally sellers just won’t respond. In that case, rather than letting the inspection period expire buyers may want to cancel the contract while they can still do so without penalty.

Inspection periods used to be separated. Buyers had X number of days to have the inspection, sellers had X number of days to respond and both parties had X number of days for negotiation. Many of us prefer the old system but it wasn’t perfect either as parties would disagree over which day or period was which and when they started or ended.

Occasionally for houses that are going to sell with multiple offers, the buyer will have an inspection done before making an offer or waive the inspection. I am not a fan of waiving a complete home inspection for any reason. Third party inspections protect buyers, sellers, and real estate agents.

It should be noted that even if the contract states that the sellers can continue to show the house the showings will slow down or stop once the seller has accepted an inspection contingent offer. Sellers can only sell to one party but can collect offers during the inspection period as backup offers.

Screen print of contract with Inspection contingency