There isn’t much on the market this spring. That was true last spring too as the homes that were for sale were quickly purchased.
This year fewer Twin Cities homeowners are selling. The houses that are on the market sell very quickly. There is a 1.5-month supply of houses on the market in the metro area.
New listings are down 21.29%. Higher interest rates are largely to blame. Homeowners are staying put rather than moving and paying higher interest rates. We are seeing a lot of cash offers this spring too.
If you are a home buyer and you are getting information from the NorthstarMLS, there is a disclaimer on the information: “Information Deemed Reliable But Not Guaranteed”.
If you are searching homes for sale on almost any website the data is coming from the Northstar MLS.
Some of the information is more reliable than the rest. Generally, the address, including the city and state the property is located is accurate. The listed price is likely to be accurate too. It is very hard to list a home in the wrong school district or in the wrong county.
Taxes and assessments are easy to verify by checking county and city websites.
Room sizes and measurements are notoriously inaccurate but I don’t find many that are so far off as to raise alarm. The foundation size and total finished square footage are sometimes wrong.
Association dues for condos are not always accurate but the association will provide an accurate amount in writing.
The number of bedrooms isn’t always accurate but Realtors are expected to provide an accurate bedroom count. I have seen houses listed as two-story houses that are really 1.5-story houses. It is usually pretty easy to tell from the picture.
At some point in the late 1880s, there was a fire and some tax records were destroyed. For the most part, we don’t know how old the houses that were built before 1885 are. The oldest houses will have a construction date of 1885.
Tax records are not always accurate either. Appraisals are a much better and more accurate source of information about square footage and room sizes. The lot sizes in the tax records seem to be fairly accurate.
People sometimes make mistakes. Listing information can go from the owner to an agent to clerical staff who actually enter it into the MLS.
I once had a client cancel a purchase because the house was 300 square feet smaller than what was listed in the MLS. The house was still big enough but the buyer was angry that he had been deceived.
The information in the MLS is deemed reliable because we are expected to put accurate information in the system. There is a link on each listing that real estate agents see and can click to report incorrect information so that it can be corrected.
Home prices are still going up in the Twin Cities Metro area. If you bought your house in the second half of 2020 or in 2021 it might not be worth quite as much as you paid for it even though the value has gone up.
Multiple offers on homes for sale were very common during that period and often the sale price was well over the asking price. It is quite possible that some home buyers overpaid. Some overpaid by tens of thousands of dollars.
Buying a house and selling it two years later is always an expensive proposition. It won’t take long for the house to be worth t but what was paid for it. Expect to own the home for at least five years, seven to ten years would be even better.
Buying a house is not the best short-term investment.
I encourage home buyers to ask for a complete home inspection. For the last couple of years, buyers were skipping the inspections to make their offers more competitive.
This year buyers are asking for inspections and some are asking for repairs. Some of the repair requests are kind of silly and they seem to just irritate the homeowner. Especially in cases where the buyer knew about the need for repair when they made the offer.
Inexperienced real estate agents can mess things up by asking that a licensed professional adjust a door or caulk a window.
No licensure is needed for caulking or door repair or for many of the household tasks and repairs that buyers ask for.
A real estate agent is a licensed professional.
I something is leaking or not working asking for a repair makes sense. Some of the repairs that buyers ask for are upgrades, improvements, or home maintenance items that a well-meaning inspector is suggesting.
Sellers who wish to sell without making any repairs should put in writing that they will not be making repairs. The language can be put in the MLS so that buyers see it on the internet before they even see the house.
Home buyers should understand that sellers can say no to repairs and sometimes it really is easier and less expensive to put the house back on the market and sell it to someone else than it is to have the repairs made.
Home inspectors are not licensed in Minnesota. A person can buy a franchise or go out on his own and become a home inspector. I say this because most home inspectors are men. I am referring to the complete home inspection requested and paid for by home buyers.
There are some wonderful inspectors out there. There are also some who really don’t know what they are doing and over the years I have seen it all.
Sometimes, buyers, have friends or family members conduct the inspection. That can work but only if the person doing the inspection knows what to inspect and have a system so that they don’t miss something vital.
One of the worst things an inspector can do is give advice outside his area of expertise. For example, an inspector should not say that a boiler needs to be replaced. He should recommend that the buyer have a licensed HVAC contractor inspect the boiler. He can also state his findings like ‘rust” or “leaking” etc.
Sometimes an inspection will lead to another inspection this is especially true in the case of heating plants, chimneys, and main sewer lines.
An inspector should never tell the buyer what the seller should repair. It is up to the buyer and seller to work that out. In most cases are no rules about who is responsible for repairs.
The inspector should not tell the buyer that the HOA is or is not responsible for a repair, or that they are not responsible for it. The condo documents will outline what the association is and is not responsible for. Generally, if an item that needs repair is inside the condo and if it is used exclusively by the condo then the condo owner is responsible for repairs and maintenance. Always consult the condo documents.
Mold always means trouble and is often mislabeled by well-meaning inspectors. I have seen requests to have entire foundations replaced due to “toxic black mold”. I often refer home buyers and sellers to the Minnesota Department of Health website. They have excellent information about mold. Not all mold is harmful. Penicillin is an example of a helpful mold.
Realtors usually know several good inspectors but should always be recommending at least three inspectors. The buyer’s agent should not choose the inspector that choice is an important part of the buyer’s due diligence.
I’ll always recommend a complete home inspection before committing to buying a house. The inspection also protects the sellers who may not know about a repair issue that they can be accused of hiding.
I was going to call this “Throw Back Thursday for buyers’ agents”. Negotiating has come back. It is still a seller’s market but it is getting a little harder to sell a house because of the high prices and high-interest rates. Sometimes homeowners need to make some concessions to speed up the sale.
The best way to get a seller concession is to ask for it. Here are some things that can be put into an offer on a house. The seller might say no but they might say yes:
Ask for repairs – within reason. Make sure buyers understand the difference between a needed repair and an upgrade.
If the buyer is a little short of cash for a downpayment go ahead and ask the seller for help with closing costs.
Some houses are overpriced. Go ahead and offer less than the asking price.
Yes, you can ask for new appliances.
Ask to have the home professionally cleaned.
Have the seller hire a pro to shampoo the carpet before the closing.
It used to be common to ask to have the furnace or boiler certified.
The sellers may agree to pay to have the chimney cleaned.
Buyers and their agents will need to use their imaginations.
Remember, it never hurts to ask and sometimes the answer is yes. There are many other things that can be negotiated into a purchase agreement. It is as if buyer’s agents have forgotten how to negotiate.