Lake Homes Are Selling Fast

  Chisago County waterfront homes are bringing in buyers from around the country. We have buyers coming up from Florida, Arizona, and other states to find a summer home close to their snow-bird friends that go south for the winter. With the better economy and low interest rates, more buyers can afford a second home. 

  We are also seeing families from around the metro moving to the Chisago Lakes for better schools & community, and we have local residents selling their homes and moving onto the water. There are many investors buying waterfront homes as well. When you search for Chisago County vacation rentals, there are dozens of waterfront properties available. 

    According to the Multiple Listing Service, from January to July 15th this year, there have been 45 single family, waterfront homes that have closed in Chisago County. The median price was $321,500, with the highest price at $750,000 on West Rush Lake. During the same period last year there were 35 closed sales with a median price of $367,500 and the highest sale was $675,000 on the Sunrise River.

  The lower median price, this year, is not representative of declining prices, but indicative of smaller or older homes that have sold this year compared to last. 

  Forest Lake has had 16 sales this year with a median price of $481,200, and White Bear Lake has had 6 sales with median price of $844,198. Chisago County is much more affordable and still close to the metro.

  Because of the high demand for waterfront homes and the low inventory, many homes are selling before they go on the MLS. 

  There are currently 48 Active listings on the water in Chisago County with a median price of $399,900 and the highest priced home available is $1,350,000 on Chisago Lake.

  May, June, July, and August had the highest number of sales in 2018 with each month closing 13-17 waterfront home sales. December, January, and February had the least amount sales.

  If you are thinking of buying or selling a waterfront property this year, contact a local experienced real estate agent right away, to help you navigate the real estate market in the Chisago Lakes Area.

Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to ckempenich@cbburnet.com. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.

Offering FHA Financing Brings More Buyers

    FHA financing offers lower down payment and credit requirements, but not all homes qualify for this program. FHA requires the property to meet HUD’s minimum standards for health and safety in addition to determining the current market value is at or above the purchase price.  

  Offering your home to FHA buyers increases your buyer pool which can bring a higher price.  A seller can decide to accept or decline a purchase agreement with FHA financing, but this discussion should take place with the listing agent before the property goes on the market. If the seller wants to offer the home to FHA buyers there may be additional repairs required by the FHA appraiser.

  The FHA Handbook cites the primary areas of inspection are the roof, the foundation, lot grade, ventilation, mechanical systems, heating, electricity, and crawl spaces (when present). HUD’s primary concern is the health and safety of the home buyer who will live in the house. Above all, the home must be habitable and comfortable, without any potential hazards to the occupant.

Here are some of the key inspection areas required by HUD:

  • The lot should be sloped to allow water to drain away from the house.
  • All bedrooms should have egress to the exterior, for reasons of fire safety. 
  • Many homes built before 1978 still contain lead-based paint, which is a potential health hazard. In these homes, the appraiser will check for peeling or chipping paint. 
  • All steps and stairways must have a handrail for safety. 
  • The heating system must be sufficient to create “healthful and comfortable living conditions” inside the home.
  • The roof should be in a good state of repair and must keep moisture from entering the home. It should “provide reasonable future utility, durability and economy of maintenance.”
  • The foundation should be in good repair and able to withstand “all normal loads imposed” on it. 

The appraiser can site required repairs as a condition of the loan, which means the repairs must be made and re-inspected prior to loan approval. 

An experienced real estate agent can help you decided what terms you will accept from a potential buyer, and offer repair advice before you list your home for sale. 

  Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to ckempenich@cbburnet.com. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.

Seller May be Liable for Repairs After Closing

  Occasionally I hear from buyers after they have closed on their home and moved in, that something isn’t working properly, and they want to know if the seller will pay to fix it.  When I get these calls, I refer to the Seller’s Property Disclosure Statement and the Buyer’s Inspection Report, to see if there were any comments about the issue prior to closing.

  I hear different types of complaints, from the air-conditioner isn’t working (usually from winter sales when the AC can’t be tested), to water in the basement, and most recently that there was hail damage to a roof 2 weeks before closing that no one knew about as the home was vacant.

  Once we determine the defect wasn’t disclosed, I contact the seller’s agent and ask for the seller to repair or replace the defect. In many cases the seller writes a check and we are done. If the seller declines the buyer may opt for Arbitration, Conciliation Court, Mediation, or District Court. Personally, in 30 years, I have never had a buyer sue a seller or request Arbitration or Mediation.

  Some buyers elect to purchase a one-year home warranty or ask the seller to provide one. One of my clients recently got a new dishwasher and central air-conditioner a few months after closing. I hear from many clients, that they have used the home warranty for miscellaneous repairs.

  Minnesota Statutes require that sellers disclose to prospective buyers all material facts that the sellers are aware of that could adversely and significantly affect an ordinary buyer’s use and enjoyment of the property. Buyers need to be aware that there may be problems that the seller is not aware of and therefore they are not disclosed.

  There is a 12-page Seller’s Property Disclosure Statement form approved by the Minnesota Association of Realtors, that the sellers complete at the time of listing the property. If there are any changes that occur prior to closing the seller is obligated to update the disclosure. 

  In some cases, there is a Seller’s Disclosure Alternative form, where the seller does not answer the disclosure questions. This typically occurs in foreclosure properties, investment properties, or estates where there is a Power of Attorney or the seller has not lived in the home for some time.

  The disclosure form is not a warranty, and buyers are encouraged to have an independent home inspector inspect the property. Most purchase agreements are contingent on a buyer’s inspection. During this contingency, the buyer has the option to ask the seller to make repairs, provide compensation in lieu of repairs, or cancel the purchase agreement because of the condition.

  It is also recommended that buyers walk through the home again before closing to ensure it is in the same condition as when they purchased the property and that agreed upon repairs were made.

  Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to ckempenich@cbburnet.com. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.

Selling Your Loved One’s Home After They Pass

  Losing a loved one is a difficult process and dealing with their estate can be overwhelming. I have helped many clients sell their parents home, and I have dealt with two of my own parent’s estates over the past year.

  With most of my clients there was no planning or preparation, so in addition to selling their home, they had to deal with personal belongings, and trying to determine what bills they had to pay or cancel, and some had to deal with probate court.

  Several of my clients hired an auctioneer to sell their personal property and they hired an attorney after the death of their loved one to help with probate court.

  Many homes of older people are dated and have deferred maintenance because it was difficult or expensive to maintain. Without a will, the property generally passes to the children equally. This can be a problem if there are stepchildren, as they may be left with nothing without a will.

  Some siblings live in different states and don’t get along. If they all own the property equally; they may all be required to sign a listing agreement, purchase agreement, and closing documents. In this case they don’t always agree on the price, selling as is, making improvements to sell, or even selling at all. Having an executor established could help resolve some issues.

  When my dad was diagnosed with cancer, we met with a local attorney, Tim Peterson, and he reviewed my dad and stepmother’s assets, updated their will and put their properties into a Trust. We all new exactly what our parents wishes were so there was no dispute. When questions came up, we had our local expert to turn to.

  Several of my older clients sell their home and downsize to a condo, townhome, or apartment to avoid maintaining a home. When their home is sold while they are living, they have say in what happens to their personal belongings, and it is usually easier for the children to help their parents with this transition while they are still alive.

  If you are concerned about dealing with a loved one’s estate, I strongly suggest that you meet with an attorney before they pass, and an experienced local real estate agent to determine the best way to deal with a difficult situation.

    Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to ckempenich@cbburnet.com. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.

Selling Your Home Face to Face

  Chisago County is home to many homeowners that don’t use a computer or email. Most, but not all, are senior citizens that want to downsize, many of which, have not bought or sold a home for decades. Most real estate agents, lenders, inspectors, & title companies like to communicate via text and email and use electronic signatures; but for many clients we still work face to face and sign paperwork in person. 

  Buyers and sellers that don’t use email should be more cautious when interviewing a real estate agent to sell their home. There are some agents that work with younger clientele or work closer to the twin cities that have never done a complete transaction in person. To be efficient and timely it is important to work with a local agent that can be responsive in getting signatures quickly.

  Our contracts can be completed online and emailed to our clients for electronic signatures, but we can also complete them by hand and have them signed in person. Over the past couple of weeks, I have worked with six local clients that didn’t use email. 

  At the initial meeting we reviewed the market analysis and the listing agreement. Then the 2nd meeting involved signing contracts and disclosures and reviewing the septic inspection application and the water test instructions. The signed documents get scanned and emailed to the Broker and the listing is input onto the MLS.

    The 3rd meeting was presenting an offer, estimate of proceeds and preparing a counter-offer addendum if needed. The sellers signed the documents and then they were scanned and emailed to the buyer’s agent. There can be multiple counter offers that go back and forth.

  Once we had a fully executed purchase agreement, there was a buyer’s inspection which involved negotiating repairs. An amendment to the purchase agreement needed to be signed with the repair agreement and again there can be counter-offer addendums that go back and forth.

  The signed documents have to be delivered to all parties, so there can be a meeting for signing and another for delivery.

  We also work with lenders and closers that accommodate sellers with mailing documents or meeting them at their homes or even nursing homes. 

  If you don’t text or email, it’s important to work with an agent that will be responsive by phone. It is wise to interview more than one agent, work with a local neighborhood expert that has expertise in your type of property and discuss your communication requirements.

  Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to ckempenich@cbburnet.com. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.

The Real Estate Market is Heating up!

  After another long, hard winter new listings are starting to enter the market. Inventory is extremely low and multiple offers are common as buyers are competing for homes to buy. In March of 2018 there were 113 new listings in Chisago County but there were only 87 new listings last month. 

   There is especially a shortage of one level townhomes for seniors, lake homes, and homes that first time home-buyers can qualify for. 

  Looking at the current Active Listings on the Multiple Listing Service for affordable homes that first time homebuyers qualify for; a 3-bedroom, 2 bath, rambler with 1700sf (including basement) and 1 garage stall in Rush City was listed for $160,000 and had multiple offers the first day on the market. The best buy in the Chisago Lakes Area was in Taylors Falls with a 3-bedroom, 1 bath home with 1150 sf and a 2-car garage for $190,000. It also sold in multiple offers the day on the market.

  There are 18 pre-owned waterfront homes on the market, in Chisago County, with a median price of $342,450. New construction is driving prices up with 11 “to be built” homes on waterfront with a median price of $490,000.

  There are 31 townhomes on the market, 12 of those are pre-owned with a median price of $222,500. There are 19 new construction townhomes on the market with a median price of $255,900. The median price of the new construction, one level living townhomes in the Chisago Lakes Area is $296,900. 

  Homes that sell in April and May typically get the highest prices, because of the pent-up buyer demand. New listings will continue to increase through June, but if your home isn’t sold by July, you run the risk of selling off season. Home prices typically start to decline in August through the end of the year.

  If you are thinking of selling soon, now is the time to talk with an experienced real estate agent for advice on the best time to sell your home, and tips to get the best possible price. 

Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to ckempenich@cbburnet.com. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.