I bike

It is Friday and Fridays are for fun. I really enjoy biking and am considering an electric bike this year. I read about tax incentives for electric bikes. Seems to me there should be tax incentives for bikes that are powered by humans instead of batteries but what do I know.

Minnesota is offering rebates on electric bikes but with a twist.  A person needs to get a rebate certificate before buying the bike to get the rebate. There is an application process through the Minnesota Department of Revenue.

The website and only place to apply for a rebate certificate opened and crashed and apparently died on June 5th, 2024 (R.I.P) moments after it went online. (or did it ever even go live?) We don’t know when or how applications for rebates will be available.

 

MN Department of Revenue rebate application website

I am not a fan of rebates or Minnesota government websites. I can’t help but wonder what is going to happen to the 2 million dollars allocated for the electric bike rebate program. Will the funds be used to build a better website?

On May 25th of this year I road in the Med-City Meander in Rochester Minnesota. I rode 30+ miles on my old-school manual bike.

rest stop - medcity meander
Rest stop in downtown Rochester Med-City Meander May 25, 2024

 

May 2024 Home Sales in St. Paul

New month, same story. The low inventory of homes for sale and the high demand are driving prices up. Home sales likely peaked for the year last month. Some home buyers are waiting for interest rates to go down because high home prices and high interest rates makes home ownership unaffordable.

Houses are selling quickly in St. Paul, often with multiple offers. If you would like to sell your house go for it.

Chart showing home prices and sales by nighborhood
Home sales by St. Paul Neighborhood for May 2024

The numbers used in the table were extracted from the NorthstarMLS. The data is deemed reliable but not guaranteed.

 

2008 all over again?

Coins, moneyLet’s not forget what happened during the housing crash. Many homeowners ended up in a negative equity position. In other words, they owed more on their houses than the houses were worth. I well remember sellers bringing money to the closing so the mortgage could be paid off.

Here we go again with loans that guarantee the borrower will have no equity from the start via zero-down mortgages.

United Wholesale Mortgage (UWM), one of America’s largest mortgage lenders, is offering zero-down mortgages, opening up home ownership to more people but revitalizing a controversial practice that carries as many risks as advantages for cash-strapped home buyers.

Here’s how it works: For first-time homebuyers making 80% of their area’s median income or less…

  • Buyers take out a mortgage for 97% of the value of the house they buy.
  • The remaining 3%, up to $15,000, is a second interest-free mortgage.

The second mortgage has to be paid back in one payment when the first mortgage is paid off or the house is sold or refinanced.

Under the program homebuyers start without any equity, so if the value of their home decreases, they would instantly owe more than the house is worth.

If a buyer has to sell quickly, they’ll still have to pay back the entire second mortgage or risk default/foreclosure.

Buyers may get stuck with a higher mortgage rate, even if the Federal Reserve starts to cut interest rates because to refinance, borrowers need to have enough cash to pay back the second mortgage.

Please think before you borrow and borrow responsibly.

Black is the new orange

Decorating trends come and go. I can easily tell when a house was decorated by the color of the walls, rugs, and furniture. In the last few years gray has been popular.  Even though the trend is dying it isn’t unusual to see an entire home interior painted in shades of gray with gray flooring.

I don’t disapprove of gray but not on every surface. I have heard designers talk about colors that will “pop” in a gray room. I guess I don’t expect popping to be going on in my house.

In the last few years, all-black exteriors have become a trend.  The white snow will make the black house “pop” all winter.

In color psychology, black means power and control. Black is intimidating, unfriendly, and unapproachable. Knowing that helps me understand.

An all-black exterior isn’t going to be easy to paint over when white becomes the new black in a few years.

black house with black trim
Forepaughs Mansion on Exchange Street in St. Paul.

Few homes for sale means fewer home sales

The very best years I had as a Realtor were 2013 – 2015. There were fewer Realtors than there are today and more houses to sell. The number of homes on the market has been declining ever since and at the same time there are a record number of Realtors. If you plan on working with a Realtor please choose with experience. Experience is even better than a fancy car or someone “nice”.

There is some good news in the housing market. The median days on the market during June was 11 days. Prices remain at an all-time high. It is all about supply and demand. Mortgage Interest rates are on average slightly over 7%.

That means houses are selling fast. I’ll have lots of numbers by mid-week. I need to wait a day or two for the dust from May to settle.

Chart - home sales last ten years
Home sales in St. Paul, since 2014

Pictures you can smell

It is Friday and Fridays are for fun. I found this toaster in a thrift shop last week. Looking at it brought back so many memories of burnt toast. I can not look at the picture without smelling burnt toast. The toaster isn’t hard to use and it is possible to perfectly toast bread with it. The trick is to watch and check on the bread. I wasn’t very good at that as a child or teenager.

 

Toaster
Toaster – vintage – late 1920’s to early 40’s