Have you seen your Ramsey County proposed property tax statement for 2012 yet?  Chances are your property taxes went up this year.  We got an increase of 8.1%.  The county assessor decided that our property value is the same as it was last year.

If you own property in Minnesota chances are your property taxes went up even if your home value went down.   Part of the increase is due to a change the State of Minnesota made to get a budget passed last summer.  The state needed to cut spending which they did by reducing the amount of money they use to off set some of our property taxes. It is a taxation shell game and is designed to be too complicated and convoluted for tax payers to understand.

There is a video on the MPR web site that explains the increase and Ramsey county is referencing the video as their explanation too which makes sense because we all trust MPR.   The state switched from the Homestead Market Value Credit to the Homestead Market Value Exclusion.  

This evening at 6:30 PM there is a public meeting/open house to discuss proposed 2012 budgets and proposed 2012 property taxes. You are invited to attend this meeting to express your opinion regarding the proposed budget and levy.  The hearing will be held at Roseville Area High School Cafeteria 1240 County Road B2, Roseville, MN [details and map]

The hearings are a hoot and there are several of them.  Angry tax payers will complain about everything under the sun and some of it even has to do with taxes.  When the complaining is done the proposed property taxes will become the property taxes, due in October and May of each year.  

The property tax statement itself has a lot of information on it and is worth a read. 

Schmidt's Brewery

The old Schmidt's brewery has a rich history and every five years or so a new developer comes along with plans for the place.  This time it might all work out as the Fort Road Federation is the developer and they have a track record for getting the job done if it can be done.   The project is being called the Schmidt artist lofts. 

The federation is redeveloping the space into  220 to 250 artists lofts.  The plan is to make high-end, oversized and affordable rental units. There will also be some retail space and office space in what is being called an artists complex.  The project will  create jobs but it is likely that the people and companies who will get them already know who they are.   According to the Federation's web site this is a 25 million dollar project. 

This was an active brewery as recently as 2002 and then the first ever urban ethanol plant and that did not work out so well.   It has been closed and vacant since 2004.  The 11,000 foot deep well on the property was reopened to the public in 2009, it is the best water around. 

In 2005 the historic brewery site was on the list of most endangered historic sites.  In 2007 a developer bought the brewery but I think it may have been the crash of the housing market that stopped the project. 

See Preserving out past

I don't have a PHd in economics but I am going to go out on a limb and say that interest rates are not holding the housing market back.   They are at a 60 year low yet the housing market continues to struggle. 

It seems to me that if there were more jobs more people would buy houses and they would pay more taxes which would help governments pay their bills.  

If you have a job and can afford your rent or house payment there is no recession, or if there was it is over.   If you are unemployed, under employed and or struggling to pay a mortgage we are in an economic depression that started in several years ago. 

We should only report happy news because happy news is good for the economy and the housing market.  My happy news is interest rates are at a 60 year low.  Do your part, help the economy and buy a house today. 

Electronic signatures

New state laws often take place on August 1 and since real estate is highly and I do mean highly regulated on the state level we usually end up with new rules and that means new real estate  forms and changes  to existing forms to reflect new laws.   There is a forms class for real estate agents and brokers taught by the Minnesota Association of Realtors that goes over the changes.

I really wish all agents would attend the forms class.  Instead they like to tell us what is “legal” and what is not.  Each brokerage has it’s own unique interpretation of the forms and they like to hold the other party hostage until they get their way.

Several forms have been changed because of electronic signatures.  They are legal in Minnesota and they have been legal for years.  This language was added to some of the contracts: “Electronic signatures:  The parties agree the electronic signature of any party on any document related to this transaction constitute valid, binding signatures.”   I won’t know for sure until I go to the forms class but my guess is some agent told another agent that he/she has to have a written signature because that is how one party signed.  The party who signed electronically was probably in Outer Mongolia and the agent representing the party who signed with a written signature decided it wasn’t “legal” to have one of each type of signature and held all parties hostage until he/she got a written signature.

At any rate being the rebel that I am I use a product called EchoSign for electronic signatures.  My clients love it and I started using it when I discovered that I was not smart enough to figure out how to use the special software they make for real estate.   I will go on record as saying I am a raving fan of Echo Sign.  When I am fortunate enough to have a client sign documents in person I have them signed on my iPad with a real signature right on the screen.   I have had entire transactions where nothing has been printed the documents were either signed electronically or I had them signed on my iPad.   Clients get electronic copies of the files and so does the lender and the all other parties who need copies.  EchoSign was recently acquired by Adobe and so far they have not wrecked it.

Also see:

Real Estate And Paper

 Not all of the homes in St. Paul are surviving the crash of the housing market.  Some are being demolished.  

41 Douglas street

Some are for sale.  In fact there are 39 assorted city lots and pieces of land listed in our MLS and for sale signs around town.  Prices on vacant land start at just under $1000.  I remember when I had the only vacant lot for sale in the city limits and that was in 2006.  Builders had purchased most any piece of land that could be built on.  Buyers were always looking for lots for sale. 

These lots will be needed in the future but right now they just sit empty and waiting.  Some of the lots have been annexed by nearby property owners who now have two postage stamp sized city lots to mow and care for. 

 We don't know yet if Minnesota will close on July 1st.  The shutdown will have no impact on real estate.  We can continue to buy and sell real estate with reckless abandon and closings will happen or if they don't happen it won't be because the state has shut down.

Fort Snelling state park may be closed over the 4th of July weekend. I am assuming they will leave the bike trails open at least the trails that are not flooded. 

Historic fort Snelling - State Park

The Legislature passed a $34 billion state budget budget with no tax increases, but Governor Dayton vetoed it.

The state apparently has to close if they don't have a budget approved. There is a 1.8 billion dallar shortage and the governor wants to raise taxes on the wealthiest Minnesotans to support more spending but the Rebulicans have rejected that plan.

Personally I don't totally agree with either party but I am like that. Just call me a free spirit. I think that it is the job of all parties to keep the state running.  I also think that it is a shame that former Governor Pawlenty escaped before he had to deal with this mess.  

There will be a trickle down affect if the state closes and we will feel it in downtown St. Paul.  State employees spend money downtown.  With out them local businesses will suffer.  
 

The Saint Paul Area Association of Realtors just published a report about the state of the local housing market.  They get the numbers from the same place that we all get them from the Regional Multiple Listing Service, which is deemed reliable but not guaranteed. 

distressed

The report indicates that there were 23% fewer distressed* homes sold in 2010 than there were in 2009.  Someone messed up on the math because I come up with an 8% difference.  Great care was taken with the numbers.  They were not rounded.  2010 looks better at 39.9% distressed properties than it would at 40%. 

The numbers do not look  encouraging, other than the fact that the distressed properties are selling.  Prices went up slightly in 2010 but that is up from a low that we have not seen in at least a decade.  There is no doubt that this is a good market for home buyers and investors with the low prices and low interest rates.  Unfortunately the pool of eligible home buyers has shrunk and will continue to shrink as people are unemployed, underemployed or have been through a foreclosure in recent years and do not have a good enough credit rating to qualify for a home loan.  

It is possible that a year from now when we look at the number of distressed properties on the market in 2011 the number will be higher than it was in 2010 reflecting a higher number of foreclosures. We forget that the "robo signing" scandal caused some large banks to hold off on putting foreclosures on the market.  They needed to make sure that they actually own the homes they repossessed.  

The housing market is what it is and as always there are opportunities for some but not for all. 

*distressed is defined as properties that are bank owned or short sales that need bank approval