July 2018 home sales by neighborhood

July is over. We had a busy month with new listings and new buyer clients too. It is all a blur to me. The numbers show that there are more homes on the market than there were at the beginning of July. In many most neighborhoods and in the city as a whole the average sale price in July was higher than the average listing price.

The average days on market were less than 25 in July without a lot of variation between lower priced homes and higher priced homes.

Prices, the number of new listings and the number of pending listings were lower in July than in June. Traditionally July prices and new listings are lower than they are in June so I’ll call it a seasonal variation.

Home sales and prices by St. Paul neighborhood

The numbers used to make the chart above were extracted from the Northstar MLS and imported into an MS Excel spreadsheet where it is gently sorted and never stirred. The data is deemed reliable but not guaranteed. There are few guarantees in life and a lot of broken promises too.

If you would like to sell your home please contact me. I do have buyers looking for small homes and larger homes and condos too.

To arbitrate or not

In Minnesota home buyers and sellers are required to decide if they want to use binding arbitration to settle future disputes over real estate they are buying or selling.  New this year, arbitration will only apply to claims for more than $15,000, smaller claims should go to conciliation court.

This year 20 pages have been added to the Minnesota purchase agreement explaining arbitration. The purchase agreement without the arbitration disclosure is 13 pages long after a page about wire fraud was added on August 1st.

Home buyers and sellers should be prepared to learn all about arbitration. It is a Minnesota thing.

After reading all of the pages of the arbitration disclosure my understanding of it is about the same as it was before I read the 20 pages. There is something about that legal style of writing that makes it hard to follow.

Going forward I think I will give my clients the arbitration disclosure early on in the process because consumers need to understand arbitration and make an informed decision.

It is also important to learn about lead-based paint, we have a pamphlet for that and about radon, we have a disclosure for that.

Arbitration – from the Minnesota arbitration disclosure

Closing costs and fees and stuff

Getting an offer accepted for the purchase of a home is just one step in a process. The purchase price of the house is actually more than the amount the buyer offers when closing costs are factored in.

Real estate agents don’t create closing costs. There is a state mortgage registration tax of0.0023 and them add on another .0001 for the state environmental response fund.

Some real estate companies tack on an extra few hundred and there are closing and lending fees, and a loan origination fee. There are prorated property taxes and an insurance binder.

Real estate agents who work with buyers get paid by the listing broker, who gets paid by the seller, but not until the sale closes.

There are some who say a buyer’s agent services are free and others who contend that the fee is baked into the price of the house. Either way, a buyers agent can be a great investment if she has a lot of experience, can save you money and help you make a wise choice when buying a house.

Home buyers using any kind of financing will get a good faith estimate that shows fees and closing costs. These good faith estimates must closely match the settlement statement the buyer will receive three days before the closing.

Home buyers should ask their mortgage professional how much cash they will need in addition to the down payment to cover closing costs.

Sometimes buyers finance their closing costs by having them rolled into the loan. Sometimes buyers ask sellers to pay the closing costs which doesn’t work well in multiple offer situations.

There are programs that offer assistance with downpayment and closing costs. I had one client this summer who brought a couple hundred dollars to the closing. The rest of the funds came from a kind of low-interest second mortgage.

The buyer has a place to live for less than what he would have to pay for rent and he still has funds in his savings account.

water lily – at Como Park

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%.

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.