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New Standards for Water Heaters and Air Conditioners in 2015

by Jeff Scislow

As a continuation of its on-going efforts to promote energy conservation, the Department of Energy has announced new standards for residential air conditioners (effective January 1st) and water heaters (to go into effect on April l6th of this year.)

home energy conservationThe new mandates included the following provisions:

Air Conditioners:

  • The new regulations divide the country into three regions — North, Southeast, and Southwest — each with unique minimum SEER and EER (energy efficiency ratio) performance requirements. That ratio is a measure of the cooling efficiency of your air conditioner or heat pump. The higher the SEER number, the better. 
  • In Minnesota, part of the North region, a SEER of 13 is still allowed, but a 14 SEER is required in the rest of the country.
  •  A “sell-through period” — an 18-month period during which distributors will be allowed to sell noncompliant equipment as long as it was manufactured before Jan. 1, 2015 — has caused confusion for many in the industry when it comes to enforcement.  Can that outdated equipment be sold in the Southeast and Southwest without meeting the different SEER and EER levels for those regions?  
  • DOE enforcement plans are not expected until the end of the first quarter of the year, thus adding to the current state of flux for distributors and purchasers.

 Water Heaters:

  • The new mandates will require higher Energy Factor (EF) ratings on virtually all residential gas, electric, oil, and tankless gas water heaters.
  • Gas water heaters above 55 gallons will have to convert to a PVC flue. They won’t be able to use a metal pipe anymore. That means homeowners face a decision on whether to purchase a new water heater or convert their old one.  
  • Another concern for homeowners is that the new water heaters will most likely be bigger because of increased insulation. That means there’s a chance they won’t fit in the space where the old water heater was.

Watch this space for further clarification—if any is forthcoming from DOE.

Setting The Stage For a Winter Sale

by Jeff Scislow

While mid-winter may not be an ideal time to sell your house, circumstances sometimes dictate that you do so in this season.  Yes, adverse weather conditions may temper the enthusiasm—and the traffic--of potential home buyers, but your competition will certainly be less, and you can be assured that those who do venture out will be serious buyers. 

home stagingYou may not be able to control the climatic conditions, but there are steps you can take to keep your home from being overshadowed by the weather and to make each showing a positive experience for your buyers. 

In addition to giving your house a thorough cleaning and de-cluttering, tidying up the yard, and touching up the exterior appearance to improve the curb appeal, you can also use these home staging tips to your advantage:

Keep paths clear and safe: 

  • Continually shovel a path through the snow.
  • Scrape the walk, driveway, and back deck and patio.
  • Sprinkle a layer of sand over the sidewalk and steps.
  • Open a path from the street to the sidewalk so for easy access.
  • If it's raining, put a rubber mat by the front door and/or a container to hold wet umbrellas/shoes.

Use home staging techniques to make your house look bigger, brighter, warmer, and more appealing.

  • Remove oversize furniture from smaller rooms.
  • Turn up the thermostat to keep the house warm.
  • Have a fire in the fireplace or hang artwork that resembles fire.
  • Place a colorful folded blanket over an armchair or a plump quilt at the end of the bed.
  • If you have hardwood floors, lay down a rug with warm hues to create a little coziness.
  • Add color via towels, linens, throw rugs, and accent pieces.
  • Place pots of seasonally appropriate greenery at your front and back doors.
  • Don’t overlook the positive impact of vases of fresh flowers or the appealing aroma of baked goods.

Let there be light.   

  • Have the curtains and blinds cleaned and open them as wide as possible in daylight hours.
  • Get the windows washed and keep them clean.
  • Replace lightbulbs with those of a higher wattage.
  • lean and turn on all lamps and light fixtures.
  • Brighten dark rooms with few windows by placing spotlights on the floor behind furniture.

Need advice or help in staging?  Call us!

A Valentine to Make Your Heart Soar—a New Home!

by Jeff Scislow

Looking for a unique gift for Valentine’s Day?  Forget flowers; ignore chocolates.  Flowers die, and candy gets eaten, but a new home will continue to bring pleasure for many years. What could be a more loving present for you and your loved ones than the joy of owning a home?

gift housePride of ownership is the number one reason people yearn to own their home. It means you can paint the walls any color you desire, turn up the volume on your CD player, attach permanent fixtures, and decorate according to your own taste. Home ownership gives you and your family a sense of stability, community, and security.

Other motivators for buying in 2015 include the following:

  • You’ll be making an investment in your future security as your house appreciates in value.
  • Economic forecasters and real estate gurus predict that 2015 will be the year of the Millennials, or Generation Y buyers (those in their late 20’s or early 30’s).  A strengthened economy, a recovering job market, and a greater sense of financial security have given this group of purchasers the confidence to buy a first home or move up to a larger one.
  • Government-sponsored incentives work in your favor.  Fannie Mae and Freddie Mac are now accepting down payments as little as 3%, and the FHA recently announced a decrease in the required mortgage insurance on such loans,
  • Home ownership provides tax breaks for you.  Your mortgage interest, the largest component of your mortgage payment, is fully deductible, as are your real estate taxes.   Prepaid interest, points, and mortgage insurance are often allowed as deductions, also.
  • You can borrow against your home's equity for a variety of reasons, such as home improvement, college costs, medical expenses, or starting a new business  venture, and the interest you pay on that loan is tax deductible.
  • If you have children, they will find stability in knowing that they aren't going to have to change schools again or make new friends after they move to their new home, and a sense of place becomes very real to them.
  • Home prices are expected to rise 4.5% this year, and mortgage rates will soon begin to climb.

Convinced that you should celebrate Valentine’s Day by looking for a home you and your family will love?  Contact us, and we will spend as much time with you as your heart desires!

Home Sellers Can Avoid Unpleasant Surprises

by Jeff Scislow

We all know that a surprise birthday party, opening a gift containing a much-desired item, or an unexpected visit from a long-lost friend is a delightful experience. We generally enjoy surprises, but discovering just before closing that your home has inadequate wiring or plumbing does not fall into that category and will certainly sour the selling process, if not the entire deal, for both you and the prospective buyer.

home inspectionIn an effort to avoid such unexpected and unpleasant occurrences, more and more sellers are relying on pre-listing professional inspections.  The inspector will provide a typical inspection and create a report, and as the seller, you may choose to also have a one-page overview prepared for easy reference.  You and the real estate agent then review the report and/or overview for approval and may opt to adjust the listing price or other factors. Then, both the report and overview are printed and made available to other Realtors and to prospective buyers.

Why should you pay out roughly $300-$500 before you even have an offer on your home? By doing so, you can avoid prolonged negotiations (and possibly hard feelings) with the purchaser, a delayed closing, and having little time to decide what repairs you will make and who will make them.  Paying that money early on gives you full knowledge about your property, assures that you will be in compliance with full disclosure laws, and conveys both your credibility and your expertise to a buyer.

There is also a financial advantage in having a pre-listing inspection.  Having a completed report from a certified inspector will help you and your Realtor arrive at a realistic list price. If you find out, for example, that your HVAC system will need to be replaced before the next winter season, you should take that into consideration when pricing your home, an action that will be appreciated by potential buyers.   Also, by identifying possible defects early on, you are in a position to handle the timing and expense of repairs prior to listing, thus making the listing more attractive and assuring that the property is more saleable at your asking price.

As Realtors, we can recommend a qualified inspector or you can check out the National Association of Home Inspectors or American Society of Home Inspectors.  Do make sure that whomever you choose is a fully licensed professional.

Minneapolis MN Foreclosure Trends for Dec 2014

by Jeff Scislow

In December, the number of properties that received a foreclosure filing in Minneapolis, MN was 13% higher than the previous month and 7% higher than the same time last year, according to RealtyTrac.com.

Minneapolis MN Foreclosure Status Distribution

The current distribution of foreclosures based on the number of active foreclosure homes in Minneapolis, MN.

Auctions accounted for 64.5% of foreclosure activity in December 2014 and Bank-owned properties accounted for 35.5%.

minneapolis mn foreclosure


Minneapolis MN
Foreclosure Activity by Month

The number of Bank-Owned properties decreased 3.6% compared to the previous month and dropped 5.0% from the previous year in December. The number of Auctions increased 25.3% compared to the previous month and 15.2% from the previous year.

minneapolis mn foreclosure


Minneapolis MN Foreclosure Geographical Comparison

Minneapolis MN foreclosure activity was 0.01% below national statistics, 0.03% higher than Minnesota numbers and the same as than Hennepin County statistics in December 2014.

minneapolis mn foreclosure


Curious about the value of your home? Find out NOW!

Another Home-buying Incentive From the FHA

by Jeff Scislow

About a month ago I wrote to you about FHA’s holiday gift to potential home buyers—a 3% down payment for Freddie Mac and Fannie Mae-backed loans.  Both programs are for fixed-rate loans given to first time homebuyers and those seeking to refinance. Fannie began backing the loans on December 13, while Freddie will start offering them on March 23.

fhaAnd now, another pleasant surprise from our government!  President Obama announced last week a new policy that will reduce the rate of the required annual mortgage insurance premiums (MIP) on FHA loans from 1.35% to 0.85%.  Such a reduction could amount to either meaningful savings for you on a monthly basis or an opportunity to purchase more home.

Interested?  If so, a few tips to follow to take advantage of this new policy:

  • Check back with your preferred lender about how much home you may now qualify for.  (Remember you will still have to demonstrate your qualifying income; FHA loans are government backed and require full documentation from borrowers).
  • Always consider what you can comfortably afford. While you may be able to "buy more home" with this reduction, be aware of your monthly cash flow so you don't bite off more than you can chew long term.
  • Take action now. More people may now start to look for a home, which means competition could spike in your preferred area. When competition increases, home prices rise as well. This could also mean a rush of new loan applications for lenders, which could mean extended loan closing times.
  • If you already own, consider refinancing.  With mortgage rates at 20-month lows and a reduction in the premium, borrowers may be able to achieve monthly savings byrefinancing. Those with a current FHA loan have a potential opportunity to reduce their monthly payment with a user-friendly refinance option called an FHA Streamline Loan, which is typically faster to close than a regular refinance because no appraisal is required and there are no out-of-pocket costs.
  • Discuss the opportunity of a reduced term loan (25, 20, 15 or 10 year loan) with your lender. This could not only result in interest savings through the reduced term, but may also lower your rate and offer an opportunity to take advantage of the annual MIP savings.

Don't let anxiety about financing a home deter you. As your Realtor, I will work with you and your lender to keep you knowledgeable and informed throughout the loan process.

Thinking Ahead About Tax Deductions

by Jeff Scislow

Whew!  The whirlwind of holiday activities is over, and life can resume a more normal, if colder, pace. Consider taking advantage of these quieter times to think ahead to the blossoming of spring—and to April 15th.   Begin now to plan your income tax deductions, enjoying the idea of saving money rather than spending it and knowing you can benefit from these money-saving tax tips.

tax cutOften overlooked deductions:

  • Most homeowners know that mortgage interest is deductible, but did you know that mortgage points are, too?  . Points are prepaid interest and may be deductible as mortgage interest on your home if you itemize deductions on Form 1040, Schedule A.
  • Moving expenses: If you move more than 50 miles for a new job, expenses such as movers, renting a truck, cost of breaking a lease, storing furniture, legal fees, real estate commissions and the cost of food and hotels while moving can be claimed as deductible expenses.
  • Job hunting costs: If looking for a position in the same line of work you held previously and you itemize, you can deduct expenses associated with trying to land a new position, including out-of-town lodging, transportation, employment agency fees, and  business card and resume printing costs.
  • If you turned 65 in 2014, remember that you now deserve a bigger standard deduction if you do not itemize deductions.
  • Medicare insurance and long-term care premiums: Remember to include the cost of Medicare Parts B, C, D, and supplemental insurance when you are trying to reach the magic 10% (still 7.5% for seniors).
  • State sales tax In previous years you have had a choice between deducting state income taxes paid or state sales taxes paid. Since you will choose whichever gives you the largest deduction, bear in mind the purchase of big-ticket items and home building materials. Fingers crossed for a congressional extension this year.
  • Members of the U.S. Armed Forces, especially those serving in combat zones, or National Guard or military reserve qualify for special tax deductions.
  • Early withdrawal penalty:  Did you cash in a CD early this year? If you were charged a fee for  doing so, you can deduct it directly on your 1040. Financial Planning and Management Expenses, Schedule A, Line 23.
  • If you subscribed to an investment newsletter, paid a financial advisor, or otherwise spent money to manage your money, these fees can be deducted.
  • Out-of-pocket charitable costs incurred while doing work for a charity.

We are not accountants. For more specific information please contact your tax professional.

Ringing In a New Year For Real Estate

by Jeff Scislow

A new year has just begun—and the outlook for the housing market is definitely brighter!  No, I do not have a crystal ball, nor do I read tarot cards.  I do, however, keep my eyes and ears open, follow market trends and government initiatives, keep current with recent research and survey findings, and diligently use my years of experience as a Realtor to analyze the information I glean in order to give you my take on what 2015 will hold for the real estate market.

2015The reasons for my optimism are varied and many.  Read on…

  • Results from Fannie Mae's November 2014 National Housing Survey show that American consumers' personal financial outlook has increased fairly steadily during the year, lending support to the ongoing housing market recovery.  In addition, 68 percent of respondents said they thought it was a good time to buy.
  • The millennial generation (those born between 1981 and 2000) is beginning its ascent.  Millennials make up around 65% of first-time home buyers, and 86% of those purchasers indicate that their motivation is a change in family size.
  • Most economists believe that real estate will continue to appreciate in 2015, although forecasts vary for how much prices will rise.  (The National Association of Realtors believes home prices will grow by 4% in 2015.) This projected appreciation, coupled with a gradual rise in interest –capping at 5% by the end of the year-- and increased employment and job security, will motivate first-time buyers to purchase homes as soon as they can in 2015.
  • Fannie Mae and Freddie Mac have announced that they will start backing mortgages with down payments of as little as 3% of the home's price.  Both programs are for fixed-rate loans given to first time homebuyers and those seeking to refinance. Fannie began backing the loans on December 13, while Freddie will start offering them March 23.
  • Home sales will increase +8%.  Existing home sales will grow as more buyers enter the market motivated by a clear belief that both rates and prices will continue to rise. While the majority of housing activity next year will be driven by baby boomers preparing for retirement, millennials will account for 65 percent of first-time home buyer sales in 2015.

Although I cannot guarantee my “predictions,” I am secure enough in my optimistic forecast to urge you to give yourself a real reason to celebrate the new year, and I invite you to contact us to help you make 2015 a year to remember!

Happy Holiday News: 3% Down Payments Are Back

by Jeff Scislow

In an effort to open up lending to more low-income and first time home buyers—and, we suspect, to spread seasonal goodwill-- Fannie Mae and Freddie Mac announced last Monday that they will start backing mortgages with down payments of as little as 3% of the home's price.  Both programs are for 3 percentfixed-rate loans given to first time homebuyers and those seeking to refinance. Fannie began backing the loans on December 13, while Freddie will start offering them March 23, 2015.

Who can apply?  Fannie Mae will allow new purchasers and borrowers who haven’t owned a primary residence within the last three years to qualify. Freddie Mac’s program will be limited to people who have never owned a home or those with moderate incomes or who are buying in under-served areas.  Borrowers who currently have loans backed by the two companies will be allowed to refinance with as little as 3 percent down. Fannie Mae borrowers will be allowed to take cash out for closing costs; Freddie Mac borrowers will not.  Both programs allow only fixed-rate loans on single-family homes used as a primary residence and require private mortgage insurance.

To reassure critics who fear a repetition of the infamous” bubble” and resulting real estate market collapse, Federal Housing Finance Agency Director Mel Watt stated that the underwriting guidelines of both agencies  provide a responsible approach to improving access to credit while ensuring safe and sound lending practices.

Borrowers must meet strict eligibility requirements, including automated underwriting, income documentation, and risk management standards to support their creditworthiness.  In addition, the new offerings will also include mandatory homeownership counseling and instruction, which improves borrower performance. “The FHFA will monitor the ongoing performance of these loans,” promised Director Watt.

Such good tidings offer hope for expanded home ownership in 2015.

Maintaining the Value of Your Home

by Jeff Scislow

As a homeowner, you should work to protect the biggest investment you have most likely made. Basic repairs done on a regular basis can protect your home from losing value. Updating the house and looking out for problem properties in your neighborhood can also help make a difference in your home’s value as well. 

calculatorMany factors, such as location, square footage, school district, and the number of bedrooms and bathrooms, affect the worth of your house. Although several of those parameters aren't easily changed, some are certainly under your control.

As an astute homeowner, your job is to consider both what you can do to improve your home's value, as well as what you may be doing (inadvertently, of course) to decrease it.  Completing renovations and repairs might pay off to varying extents.  Outdated appliances and old cabinets and countertops can eat away at worth. Older, inefficient water fixtures and appliances also hurt. Energy-saving refrigerators and dishwashers can update your home. Be careful about assumptions on how much value renovations will bring, however.  Upgrades can maintain your home’s value, but they may not boost it.

Home maintenance isn’t fun, but you must do it if you want retain your home’s value.  Click here for many useful tips on doing just that from basement to attic, driveway to HVAC systems, and interior to exterior.  Also, online websites can help you adhere to an efficient schedule.

One of the main things to remember while trying to boost your house's value is that people have different tastes, and those may vary greatly both geographically and demographically. A house with the flexibility to appeal to a wide audience will be more in demand than one highly customized to any one particular lifestyle. The more people who find a house attractive when it hits the market, the better off you'll be.  With that in mind, avoid quite expensive or extremely cheap fixtures and appliances and choose paint colors carefully.  Just as faded and peeling paint can be a turn-off for others, so can colors that are too unusual or bright.

Not sure about current trends or upgrade rate of return in your community?  Ask us for guidance on what you can do to boost your home’s value. You don’t need to list your property to call in a sales agent for a consultation on how to improve worth.

Displaying blog entries 1-10 of 85

Contact Information

Photo of The Scislow Group Real Estate
The Scislow Group
RE/MAX Results
15451 Founders Lane
Apple Valley MN 55124
Office: (952) 953-5000
Mobile: (612) 276-2336
Fax: Fax : (952) 431-0420