There was a rise of 12.8% on existing home sales within the month of December. This meant that the increase was 5.28 million units, and the forecast was a rise of about 4.1% or about 4.87 million units (The National Association of Realtors is responsible for collating these figures). In the event, the actual figures have surpassed expectations. On the other hand the supply of homes in December fell to 8.1 million units. This is the lowest recorded level since March in the previous year.

An overview of the trends

This increase in home sales has been crucially broad bases. For example the single family home sales increased by 11.8% while the multiple family occupancy unit sales rose by 16.4%. From a geographical perspective the sales in the Northeast increased by 13.0% while those in the Midwest rose by 11.0%. In the West the rise was 16.7% while the South experienced an increase of 10.7%. From a year-on-year point of view, the sales went down by 2.2%. Nonetheless the sales were lower in December of this year when compared to the situation last year in virtually all the regions. The only exception was the West where the figures were even.  Some pointers include:

1. It would appear the tax credit for 1^st time buyers is losing its distortion on the market. The trend has followed the ones seen in the “cash for clunkers” program. For a short period of time sales were boosted but there was no long term growth. The sales tend to bottom at about 5 million units in 2008. However, there were further reductions during the severe part of the recession between late 2008 and early 2009. The tax credit then pushed them higher than normal. Some of the issues identified include a distressed market and the tax credit.
2. The prices of homes have experienced a significant fall in the past four years. Looking at the 12-month medium price, it is clear that a decrease of 23.1% has been experienced since 2006 when they prices were at their high point. The price series is not seasonally adjusted and therefore the 12-month median price seems like a good figure to use.  On an annual basis, the drop in price was about 5.8%. Last year there was an element of stability but the downward trend is beginning to take hold this year.
3. The legal framework in which companies are operating has reduced the number of foreclosure sales within certain states. The NAR figures do not account for distressed sales in many states. Therefore any substitution effect will appear as a bump. This occurs when buyers opt to wait for foreclosures instead of going through the MLS system.

Please find the response the GLAR REALTORS have provided to Crow Wing County in regards to the proposed ordinance.

“We encourage you to share this information with anyone you feel may be interested and suggest providing comments to the County prior to December 20, 2010.“

Here is a peak into the .PDF files,

Revision Requests:

1) Issues Related to Existing Lots, Uses, and Structures.

2) Issues Related to Standard for Impervious Area and Shoreline Vegetation Buffers.

3) Issues Related to the County’s Administration of the Proposed Ordinance.

4) Various Other Specific Aspects of the Proposed Ordinance.

“Issued Related to Existing Uses, Lots, and Structures – 1) The proposed ordinance lacks adequate protection for existing uses, lots and structures.  – The proposed ordinance will have significant impact on lots & structures that were lawfully commenced, constructed, and created under prior versions of the zoning ordinance and are currently treated as lawfully nonconforming, but which would lose that status if the proposed ordinance is adopted as currently worded. In particular, the County should continue to protect uses, lots, and structures that were lawfully commenced, constructed, and created after January 6, 1970 date of the initial adoption of zoning in the County. “

Crow Wing County – Ordinance Letter & Recommendations – 12/17/2010
Crow Wing County – Ordinance Letter 12/17/2010 – detailed explanation
Crow Wing County – Ordinance Letter – 12/17/2010 Appendix 1
Crow Wing County – Ordinance Letter – 12/17/2010 – Appendix 2

For more information on the ordinance revisions please see our official post on the 2010 Land Ordinance Revisions.

MinnesotaFaceofForeclosure.com has an excellent video on Minnesota Foreclosures.

Talking Points:

* Foreclosure Process

* Resources & Who to Turn To

* Foreclosure Counseling

* Additional Tools

SEMAR Presentation Minnesota Foreclosure Slideshow

The mantra amongst aspiring homeowners in the Minnesota region seems to be “Now, we certainly can!”. According to various specialists, 2011 should be the year when the realty industry finally emerges from a four-year decline, bringing new hopes and promises. However, are people ready to take the leap of faith, or will everyone write this off as just another ploy meant to stir the hopelessly stale real estate markets?

Judging from the latest reports issued by the GLAR (Greater Lakes Area Realtors), it certainly seems the industry is gradually healing in certain regions of the USA, Minnesota being a shining example. With an unique alignment of historically low interest rates, rising wages and of course remarkably moderated home values, this may be the perfect opportunity for prospective home buyers to take action and realize their dreams.

According to Russ Portele, President of the Minnesota Association of Realtors, this is one of the brightest periods for residential ownership in over 50 years and seems likely to remain so until the interest rates bounce back to higher values. The unique alignment of favorable factors now observed in Minnesota makes for an average Housing Affordability Index of neary 200, meaning that the median households have nearly twice the necessary income to qualify for being granted loans that will enable them access to a median sized home.

Even though the HAI in Brainerd is currently one of the lowest across Minnesota, it is still estimated at 168. From an economist’s standpoint, an HAI of 120 would be deemed as sufficient to establish an affordable housing market. Simply put, this is the call for action many people have been anticipating. Anyone who wants to fulfill their desire to own a house in the region should take the cue and seize this opportunity before prices and interest rates soar higher. With the way things are going, it’s only a matter of time until they do.

Ordinance revisions,  part of the County’s Future Land Use Map Project, can be viewed on the County website at www.co.crow‐wing.mn.us. All comments submitted will be added to the official file and also will be handed off to the policy-makers. County staffers will analyze the public comments over a 30-60 day period. Another public hearing will be scheduled before the Crow Wing County Planning Commission. Keep reading for the video

Following any action or recommendation by the Planning Commission, the Crow Wing County Board then would host a final public hearing before taking action on proposed revisions. Please contact the Land Services Department at (218) 824-1125 to discuss any questions or concerns about the Zoning Ordinance revision process.

Crow Wing County Zoning Meeting – Part 1

Crow Wing County Zoning Meeting – 2010 from Jeff Torfin on Vimeo.

For the remaining two-part series, visit the official Crow Wing County Zoning board post

Tips for Buyers: Selecting a Lake home

Nothing beats waking up in the morning and having a cup of coffee on a balcony that is overlooking a beautiful lake. Imagine..  Just laying back on your chair, take a sip on your coffee then close your eyes and take a deep breath of fresh air, it would definitely be an experience that can only be described as ethereal.

For many buying a lake home is a dream come true. There are many things to consider, some obvious some not. Consider the following:

1) Consider the climate.

When looking out of state one thing to thoroughly investigate is the climate of the area where the lake home is. Not only that, check on whether or not the lake level actively fluctuates and any climate factors that may not be apparent. A good real estate agent will know the area well and will disclose all the pertinent factors for consideration while looking at the lake home.

2) Hire an authorized Real estate agent.

One that is definitely an expert with Lake Homes or Lake Property. Some basic research is all that is needed. Make sure the are actually a professional and live in the community. The advantages are overwhelming and will also not cost you any money!

3) Discover how much pricing varies per county or location of property for the lake.

You’ll usually pay more for full views, more shoreline, water quality, and flat lake lots. Certain lakes are going to be much more expensive simply because of the demand for access to the lake. Any “hot spots” or popular lakes where people travel from miles around to use the lake will be more expensive to purchase a home. Also any private lakes or lakes without a public access may cost more as well. This would be more desirable to the buyer.

4) Location, location, location

• Take into consideration where your friends and relations are living. Lake houses attract guests! Will your friends and family possess a long drive and want to spend the nights or is the lake house come close for informal drop ins? What about a guest house?
• Look at the size of the lake. Will you be exploring the lake by boat or simply just experiencing and enjoying the view? A 50,000 acre lake offers more variety and places to visit than a 500 acre lake.
• Once you find the best lake, think about the location of your property. Lake views can be long and sweeping or simply 30-40 feet across a small cove. Generally, you’ll purchase the ‘big water’ views. Some individuals enjoy looking at the lake, others simply need a cove to allow them to jump in their boat and go.
• Take a look how your home accentuates the lake. Usually the slope of the land continues the same way into the water. A steep sloped lot generally means you should have deep water close to your shore. A flat lake lot can mean you will have shallow water out some distance. The point is, especially if you are a boater, look into the water depth.
• Look at the water management. Who controls the lake and and also the water depth? Some lakes with energy plants will control the lake, in other cases the government or US Corps of Engineers will manage the lake levels. Some times of course Nature trumps all. Consider annual water fall and any history of drought conditions.

5) Finally, Research makes perfect of trying to find out the perfect lake home to suit your needs.

Brainerd Rotary Club’s Reverse Raffle

Win big with the 2010 reverse raffle hosted by the Rotary Club of Brainerd Minnesota. Proceeds from the raffle go to the Rotary and help support local organizations which help kids. What a great way to help local children and have a little fun in the process.

Purchase tickets from any Brainerd Rotary member or email Nancy Hall at njhall(at)nisswa(dot)com.

More info can be found at: http://www.brainerdrotary.org/2010-11/Reverse_Raffle.htm

Minnesota Housing Market Overview

• Maintaining interest rates for long term periods
• Economy is driving housing market
• Recent holding pattern is becoming “old news”
• Tax credit defaulted on it’s demand
• Inventory levels raised 5%
• Median sales price up over 2% since 2009
• 91.8% of asking price received at time of sale
• Job creation directly related to unemployment and housing sales

Brainerd Real Estate and Surrounding Areas.

The realty market in the Minnesota area is steadily growing and it has been the backbone of the local economic development. Courtesy of GLAR (Greater Lakes Area Realtors), there is a comparative analysis of the foreclosure reports between July 2009 and July 2010.  Since the web is full of “fluff” we are going to jump right into the report and leave the “fluff” for the other guys.

Signs of Stabilization and Recovery Lurk in Latest Months Indicators

The traditional closures last year were 120 while this year they have been 93. This represents a reduction of about 22%.

The figures for the foreclosures were 45 in 2009 and 23 in July 2010. That represents a reduction of about 45%.

The traditional sales are increasing while the foreclosures are reducing. This is a great indicator for the region because it indicates that there is real hope that the housing market will finally stabilize after about two years of low’s.

The increase in sales also means that consumer confidence is not completely destroyed in the market. People are still investing in the property ladder.

Looking at the homes for sale during the same period, it is possible to see that there were about 2406 homes for sale in July 2009 under the traditional method. That remained almost the same in the same month of 2010 with the figure coming out at 2,396. However the foreclosures saw a rise of about 3.5% when they came up from 171 to 177. This is not as significant as some might have predicted given the economic downturn in the recent past.

The housing stock is more than enough to meet the demand. That might be good news for the people that are trying to buy the homes but the sellers are faced with a situation whereby they cannot effectively bargain for higher prices. The final result of the increase in supply will be to reduce the unit prices of the homes. That might affect the seller confidence and people would put their homes off the market for a while.

The figures for the private waterfront

For the same months between 2009 and 2010, the traditional closed sales reduced by about 3% from 65 to 63. On the other hand the foreclosures increased by 33%. However the real number figures are not that significant since it was just one more house in 2010 than in 2009 from 3 to four. In the arena of homes for sale there was a rise of about 5.6% from 1,640 to 1,732. The foreclosure figures increased from 26 to 41 which represent a significant rise of 57.7%.

The waterfront has always been a premium area for operations and therefore it is not surprising that their figures are slightly different from the norm. Nevertheless the waterfront is still part of the housing market and it has also faced some of the pressures that happen. For example there is a concentration on the things that can be done to improve the way that the homes are managed as well as the possibilities of looking after the different demands for the buying public.

The inventory shares for the area

The highest was Aitkin N E5 which had 52 sales of which 8 were foreclosures. In general terms there was a 3.9% in homes sold that were previously owned. Homes under construction consisted of at least 26.7% while the non waterfront homes were at 1.9%. As the housing stock is rising then the buyers are also responding by putting their stake to the homes. The foreclosures continue to represent a significant problem but the downturn seems to be slowing down a bit. It is hopeful for the future where the proportion of foreclosures might go down a bit further. It is yet to be firmly established whether the stimulus is totally responsible for the reduction in the foreclosures or whether there are other factors at play.

The trends of the foreclosures indicate that there is a movement towards the middle class areas. The downturn is going beyond the social housing schemes to the middle class homes. This might act as a warning sign for estate agents in terms of the way that they set the prices. There is a possibility of negative equity if the homes are not priced according to the reality of the current prices on offer.

The USDA and VA Home loans are each government lending programs that offer flexible loan terms and eligibility requirements. Each program’s benefits are relatively similar but the programs are uniquely different because of the type of borrowers they serve.

This post comes to you from James Kelley of VA Benefit Blog. A law school student at the University of Missouri, James Kelley works to educate the public on government financing options for home purchases. James has a great understanding of the VA home loan and the USDA loan

The VA Home Loan

The VA home loan is specifically designed to help veterans and active duty service members achieve homeownership and has helped do so since over 18 million 1944. Because of its specially designed program that is partially backed by the Department of Veteran Affairs, the VA home loan program is able to loan current and former service members up to 100% while offering flexible and competitive loan terms even if they have a less than perfect credit history. Other benefits of the VA loan program include:

• No down payment required
• Mortgage insurance not required
• flexible debt-to-income ratios
• competitive interest rates

In order to apply for a VA home loan, potential borrowers should:

• Have served 181 days on active duty or 3 months during war time
• Or have served 6 years in the National Guard or Reserves
• Or be the spouse of a service member killed in action
• Have a Certificate of Eligibility

The USDA Loan
The USDA loan is specifically designed for those desiring rural housing and provides many benefits to civilians that are similar to those seen with a VA loan. Like the VA loan, the USDA loan requires no down payment or mortgage insurance, but is more geared towards providing housing for those with lower incomes. The Department of Rural Development offers two types of home loans to potential borrowers: a Guaranteed Housing Loan and the Direct Housing loan for lower income households, and also offers additional benefits such as:

• No loan limit
• flexible credit guidelines

In order to be considered eligible for a USDA home loan, potential borrowers should meet the following requirements:

• have a dependable income
• be a U.S citizen
• have a household income that is not higher than the median household income for the area

Although VA and USDA home loan programs each have flexible eligibility requirements, lenders will desire a credit score of at least 620 to secure financing. Potential homebuyers with a less than perfect credit history are still encouraged to apply as borrowers with imperfect credit have been approved in the past.