Eventually you will have to pay it back


Lenders and banks recommend home equity loans and refinancing early and often. These are the same institutions that got bailed out while millions lost their homes.

Using home equity as a source of cash isn’t a bad thing. Especially when the money is used for a new roof or for that boiler you have always wanted. The interest rates are usually more favorable than they are on other types of loans and for some there is a mortgage interest tax deduction.

There are also numerous advantages in not borrowing money that should also be explored before withdrawing money from the bank of home equity. For example a home can be sold and there can be money from the proceeds to use to buy another home.

It is also possible to own a home free and clear and enjoy a mortgage free retirement on that fixed income.

You would be amazed at how liberating it is to have no mortgage, car payments, student loan debt or credit card debt to pay down each month. Yet at the same time knowing that if you need money you can borrow against your home.

Maybe I just have the post housing crash jitters. . . but please borrow responsibly. It doesn’t seem like the banks suffered because they lent money to people who could not pay it back but many former home owners did and still are.

Price reductions are common

Out of curiosity I did a little research on price reductions and found that 62% of all homes sold in St. Paul in 2017 had a price reduction before they sold. On average they sold 27 days after the price reduction. 

Sellers are on average getting their asking price or more but when I look at original asking price Vs. final asking price the spread is a bit bigger.

Knowing when to reduce the price can be tough for home owners. If the home is getting a lot of showings but no offers price adjustment may be needed.  Starting to0 high is common as many believe that it gives them more room to negotiate or that they will end up with more money for the home.

Homes that sold without needs price reductions were on the market for an average of 22 cumulative days whereas homes that had price reductions were on the market for 117 cumulative days.


Making a dumb house smarter

My house is old. Part of it was build in 1858 and the newer part may have been built as recently as 1860. Thanks to wireless technology dumb old houses can be turned into smart houses.

I have on of those smart thermostats that I can control with an app or by voice the Amazon Echo. I don’t have to be at home to know what the temperature is in my house or to change the temperature.

There is a camera in my house that can be activated by motion and it can send me an email alerting me that someone has entered my house. I can watch someone take my stuff using an app on my phone as I dial 911 and yell at them through a speaker.

A couple of weeks ago I made my home just a little smarter by purchasing some adapters for electrical outlets so that I can turn control the outlets with an app on my phone. Lights can be turned on and off or be set on timers.

The internet of things is here and there is a lot of useful technology we can use everyday, and much of it is so easy to instal that even a college graduate can do it.

Houses can be retrofitted for technology which is a good thing. My house probably did not have central heating or plumbing in the 1860’s but it was retrofitted with those amenities too.

Internet of things

The golden rule in a sellers market

The golden rule at least the way my parents taught it to me is about treating others the way I want to be treated.

Once a upon a time I had some buyer clients who made an offer on a home. Their offer was ignored, and the sellers would not negotiate.

After at least two weeks of hard work the sellers slowly started to negotiate with the buyers and eventually they both signed a purchase agreement.

Several weeks later the sellers found themselves in a position of needing a favor from the buyers. The buyers quickly and graciously said yes to the sellers request.

Even in a sellers market on a home with multiple offers the seller may need something from the buyers at some point in the transaction. Maybe a closing date has to be changed. Treating everyone with respect and kindness and promptly responding during negotiations is free and it never hurts.

When buyers and sellers don’t get along small problems can turn into huge misunderstandings and even lawsuits.

Housing for all

Couple walking

An older but probably not elderly couple walk by the construction site where apartments are being built. The advertising on the sign in front shows a young man on a bike and lists some amenities including yoga and fitness center and bike storage.

The apartments are “smart” and there will be a rooftop terrance grill and lounge too. I work with young people and older people who are interested in living in Lowertown and most are attracted to the area, and the buildings in it by the same amenities.

Right now it seems like we need more housing of every type. Affordability is also important as rents remain high and wages remain fairly flat.