Robert Guthridge's Blog

Walz: We’re ‘Under Assault’ From Outside Agitators.” –Star Tribune headline (May 30, 2020). [ Note to Readers : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway (“Berkshire”), or any other entity referenced. Edina Realty is a subsidiary of Berkshire.] The unbelievably beautiful weather in Minneapolis today was a surreal backdrop for an equally unbelievable scene in Minneapolis’ Uptown neighborhood this afternoon (I live just west). In order of what was most eye (and ear) catching: –The sounds of sawing and hammering everywhere, as store owners cut and nailed plywood boards (see above). About 80% of the Uptown stores — which are all closed — were already boarded up. –The procession of cars slowly headed east on Lake St., towards the South Minneapolis neighborhood where George Floyd was killed while in police custody, and where looting and fire damage have been concentrated the last few nights. –In a city where you ...

Right now, most homeowners and potential buyers have several questions about their real estate market. Reach them and make a connection by creating graphic market charts with RPR and Canva. This article shows you step-by-step how to pull it off and how to position yourself as the local real estate expert in your social media circles. from RSSMix.com Mix ID 8230700 https://ift.tt/2zxR3dj via IFTTT

Candidates (so far): U-shaped, V-shaped, W-shaped, Nike Swoosh, Backwards Check Mark, L-shaped, and Square Root from RSSMix.com Mix ID 8230700 https://ift.tt/2ZK8Fxc via IFTTT

Contractual Assent . . . and a Veto Power [ Note to Readers : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced. If you need legal advice, please consult an attorney.] To successfully change the closing date of a home sale, which of the following must agree? A. The Buyer. B. The Seller. C. The Buyer’s lender. D. The Buyer’s title company. E. The Seller’s title company. F. The Realtors (Listing agent and Buyer’s agent). Answer : all but “F.” If you think that’s a lot of parties to sign off on a change . . . you’re right! Which is why it seldom happens — especially within 7-10 days of the originally scheduled closing (and especially between April and July, prime time for closings following the super-busy Spring market). Privity of Contract While the title companies don’t get a contractual say in changing the closing — that requires a Purchase Agreement Amendment, signed by both th...

Deafening Silence:  When Hours Seem Like Days The inspection was completed, but the Buyer has been uncharacteristically incommunicado. What’s the likeliest explanation? A. The inspection was a disaster, and the Buyer intends to back out. B. The inspection went fine, but the Buyer got cold feet anyways  . . . and intends to back out . C.  The Buyer is busy documenting a major defect (cracked foundation, worn-out roof, etc.).  Or several(!) of them. D. The Buyer is cooking up a long list of bogus issues, in an effort to renegotiate the sales price. E. The Buyer’s agent is juggling lesson plans for their at-home, school-age kids; trying to get an elderly parent out of a nursing home; or some other pandemic-related issue slowing their turnaround time. Answer : “E.” While the wait can be agonizing for Sellers, the vast majority of the time, any delay in hearing from the Buyer, post-inspection, is usually benign. Unfortunately, the above explanations aren’t...

Standard for Buyer’s Walk-Through Inspection [ Note to Readers : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced.  If you need legal advice, please consult an attorney.] “Buyer has the right to a walk-through review of the property prior to closing to establish that the property is in substantially the same condition as of the date of this Purchase Agreement.” –Minnesota residential Purchase Agreement; lines 357. – 359. “I know it when I see it.” –United States Supreme Court Justice Potter Stewart’s threshold test for defining obscenity. What’s fair game for raising issues during the Buyer’s walk-through inspection? (typically, conducted within 48 hours of closing). At least in Minnesota, any changes to the home since the Buyer’s inspection that substantially alter its condition. In (and Out) of Bounds; The Golden Rule In practice, such major problems as f...

Bad Call? The best way to sell a house is to exceed Buyers’ expectations (plus dangle a tempting price, and stir up lots of “pre-list” and “new list” buzz). The corollary? “The best way to lose a Buyer is to disappoint them.” –-Ross Kaplan, “ Realtor Sales Secrets” ; City Lakes Real Estate Blog. Is it a mistake not to alert prospective Buyers that the two-car garage is actually a tandem (two spaces, but one in front of the other, in single file)? In my judgment, yes. That’s because, even though a tandem garage qualifies as a two-car garage, the vast majority of home Buyers consider that much less desirable than a standard, two-car garage with side by side stalls. So, the owner (and listing agent representing them) is virtually ensuring that every prospective Buyer will start out the showing feeling let down, instead of excited about the home. While it’s certainly possible to overcome that — especially if the rest of the house is “blow away” — in general, exceed...

I have owned rental properties for many years and I prefer not to rent to tenants with pets, but that doesn’t mean I never do. There are situations where I will rent to tenants with certain pets. I understand that many people have pets and they love their pets, but I also love my rental ... Read more The post Should You Allow Pets in a Rental Property? appeared first on InvestFourMore . from RSSMix.com Mix ID 8230700 https://ift.tt/2ZyTNBE via IFTTT

Comparing Honey Crisps to Braeburns One of the more quizzical looks Realtors get is when they (try to) explain to a prospective home Seller that their neighbor’s house isn’t a “Comp” (Comparable Sold Property). In plain English: it isn’t relevant — at least directly — for pricing their home. For the uninitiated, a Comp is one of the three homes Realtors and appraisers use to determine fair market value; once the relevant Comp’s are identified, step #2 is to go through a formal “compare-and-contrast” process between the subject home and each of the Comp’s called a “CMA” (Comparative Market Analysis). So, why doesn’t the neighbor’s house make the cut? Because one (or more) of the following usually apply: One . Timing. Specifically, it sold too far back. To be a Comp, the sale must be within the last six months. Two . The neighbor’s house has yet to sell — that is, it’s “Active” or “Pending.” While a neighboring home that is currently for sale may very well compete with another ...

MLS Style Category Definitions 1. (SF) One Story (ONEST) One story single-family house 2. (SF) One 1/2 Stories (ONEHF) One 1/2 story single-family house. Second floor only has adequate ceiling height in a portion of it. 3. (SF) Two Stories (TWOST) Two story single-family house. Has adequate ceiling height throughout upper story. 4. (SF) More Than Two Stories (MRTTS) Single-Family house with more than two stories. 5. (SF) Modified Two Story (MODTS) Two story single-family house where the second story has full ceiling height throughout but has less square feet of finished space than the first level, leaving a portion of the structure without the second story. However, there is a full set of stair risers to the second story. (Does not include multi-level homes with a half set of risers but not a shorter full set.). 6. (SF) Three Level Split (THRLS) Three level split home. 7. (SF) Four or More Level Split (FOURM) . Built like a three level split, except it has a basement ...

“Wasn’t That House Interesting!” — Compliment or Dis? At least outside of Minnesota, “interesting” actually can mean . . . “interesting.” As in , “unique” (in a good way), “provocative,” or “stimulating.” By contrast, when Minnesotans say it — especially in the context of house-hunting, and they enunciate the word slowing (“i-n-t-e-r-e-s-t-i-n-g”) — they invariably mean “unique” (in a bad way), “peculiar,” or “unusual” (also in a bad way). Buyers’ agents who don’t want to waste their time are adept at making the distinction . . . See also , “ Minnesota Nice for “Back Off!”?? “; “ Sunday Open Houses & “Minnesota Nice” “; and “ Showing Feedback & “Minnesota Nice. “ from RSSMix.com Mix ID 8230700 https://ift.tt/2Ty5dSi via IFTTT

Deal Maker or Deal Breaker? What is the premium (or discount) for a backyard swimming pool? I’m not sure I’ve ever seen a single, reliable number. That’s likely because a pool’s appeal is very much Buyer-specific — not to mention variable by price point and geographic region. Minneapolis vs. Miami So, for example, for a Twin Cities family with several small children, I can imagine a backyard pool being a negative  if not a deal breaker, especially if it takes up the whole yard. That’s because the pool represents a potential safety issue, and is really only usable a couple months a year (it IS Minnesota). The rest of the time, it simply takes up valuable backyard space that could be used for playing frisbee, exercising pets, gardening, etc. Now, imagine an upper bracket home in Miami without a pool. Although that’s hardly my market, I can easily conceive that such a property would be a very tough sell indeed. Effect(s) of Coronavirus Pandemic Which leaves the effect of ...

How’s Minnesota’s Governor Doing? Ask Minnesotans The sad news from the Land of 10,000 Lakes (and nearly 50,000 state employees) is that Minnesota has been implementing the disastrous Covid-19 strategy made famous by New York’s Gov. Andrew Cuomo. The essence of the plan is to forcefully reduce the income of people at low risk, while simultaneously increasing the chances of virus exposure for those at high risk.” –“Minnesota Not Nice,” James Freeman; The Wall Street Journal (5/22/2020). [ Note : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway (“Berkshire”), or any other entity referenced. Edina Realty is a subsidiary of Berkshire.] If  The Wall Street Journal’s James Freeman is correct that Minnesota Governor is pursuing a “destructive” policy to address the coronavirus pandemic, why is Walz’s approval rating with state voters a stellar 71% now? Answer: because Freeman isn’t correct (he’s also wrong about New...

Wildlife Lost — and Found! Earlier today, I received this email from the listserv for my neighborhood near Cedar Lake: This little chick wandered into our front yard today – no signs of a mother or siblings. Does anyone have a duck family in their yard near Sunset and Drew? We’ve checked out Cedar – no duck families.” Fortunately, at least in this case, the “home search” appears to have only taken about 30 minutes, when another neighbor responded: We have a duck, but she is still sitting on her eggs. Let your new little friend know that he’ll have 5 new friends soon!” All’s well that ends well (or something like that) . . .   See also , “ Early Move-In (No Agreement) .” from RSSMix.com Mix ID 8230700 https://ift.tt/2zaKAEX via IFTTT

Real Estate Negotiating Principles “Whomever speak first [in a negotiation] . . . loses.” –Anonymous. “Whomever proposes “splitting the difference” in a negotiation stands to get the better bargain.” –Corollary, Ross Kaplan. Veteran negotiators will attest to the truth of the first statement: if you speak first, you never find out if the other side would have offered/accepted (even) more advantageous terms. It’s also the case that the more (over)eager party can’t restrain themselves, and gives that away by — yup — talking too much and/or too soon. But I’ve also found the second principle to be (mostly) true. The following is an exaggerated, fictional exchange — but serves to illustrate the usual dynamic. Buyer :  Here’s my written offer of $250k for your $500k (listed) home. Seller :  Sorry, that won’t work. I’m countering $485k instead. Buyer :  That’s still too high.  How about we split the difference? To be sure, there are situations whe...

“Hobby Farm” vs. “Farm Farm” When a home on a large lot somewhere in the ‘burbs doesn’t scratch your itch, what’s next? There’s alway a cabin up north (it IS Minnesota, after all). Other alternatives include a vacation timeshare, a 2nd home in another part of the country, or simply increased travel — at least, once pandemic-related travel restrictions ease. But, for people who have the means, a green thumb (imagined or not), and love animals, a hobby farm might better fit the bill. Exactly what’s that? Here are my five criteria: One . Size: 5-20 acres (over 20 acres is more properly considered a commercial farm (a “ farm  farm”). Two . The land is mostly arable (vs. wetlands); Three . There is an existing home that’s decent-sized but not gargantuan, and appears to be in (very) good condition. Four . Location: < 1 hour of the Twin Cities. Five . Price < $1M. Too complicated? Just search “hobby farm” on MLS  (or, have your Realtor do it ) . . . from RSSMix...

Comparing Honey Crisps to Braeburns One of the more quizzical looks Realtors get is when they (try to) explain to a prospective home Seller that their neighbor’s house isn’t a “Comp” (Comparable Sold Property). In plain English: it isn’t relevant — at least directly — for pricing their home. For the uninitiated, a Comp is one of the three homes Realtors and appraisers use to determine fair market value; once the relevant Comp’s are identified, step #2 is to go through a formal “compare-and-contrast” process between the subject home and each of the Comp’s called a “CMA” (Comparative Market Analysis). So, why doesn’t the neighbor’s house make the cut? Because one (or more) of the following usually apply: One . Timing. Specifically, it sold too far back. To be a Comp, the sale must be within the last six months. Two . The neighbor’s house has yet to sell — that is, it’s “Active” or “Pending.” While a neighboring home that is currently for sale may very well compete with another ...

MLS Style Category Definitions 1. (SF) One Story (ONEST) One story single-family house 2. (SF) One 1/2 Stories (ONEHF) One 1/2 story single-family house. Second floor only has adequate ceiling height in a portion of it. 3. (SF) Two Stories (TWOST) Two story single-family house. Has adequate ceiling height throughout upper story. 4. (SF) More Than Two Stories (MRTTS) Single-Family house with more than two stories. 5. (SF) Modified Two Story (MODTS) Two story single-family house where the second story has full ceiling height throughout but has less square feet of finished space than the first level, leaving a portion of the structure without the second story. However, there is a full set of stair risers to the second story. (Does not include multi-level homes with a half set of risers but not a shorter full set.). 6. (SF) Three Level Split (THRLS) Three level split home 7. (SF) Four or More Level Split (FOURM) . Built like a three level split, except it has a basement l...

Let us clear something up regarding the last financial crisis with housing at the center of the market unraveling. The vast majority of the foreclosures that happened in the Great Recession occurred on standard 30-year fixed rate mortgages. There is this mythology that only subprime and NINJA (no income, no job, no asset) loans were […] from RSSMix.com Mix ID 8230700 https://ift.tt/3dVmbSr via IFTTT

A lot of people want to be successful real estate investors but not everyone is able to accomplish this feat. What is it that makes someone successful at real estate? Are they smarter? Do they work harder? Were they just lucky? I think there are many traits that make someone more likely to be a ... Read more The post What Are the Traits of Successful Real Estate Investors? appeared first on InvestFourMore . from RSSMix.com Mix ID 8230700 https://ift.tt/2X6QT4j via IFTTT

“Real Estate Terminology 101” One of the confusing things about residential real estate is that, once a deal closes, the Buyer’s Agent is called the “Selling Agent.” Isn’t the Listing Agent, representing the Seller, the “Selling Agent?” Well , no. Think of it this way: the Buyer’s agent is selling something — actually, two things: One . The Buyer on the specific house. The average Buyer now looks at 12-15 homes before making their choice. Which one they ultimately select is frequently influenced by their agent’s input and advice. Two . The Buyer’s offer to the Seller and their Listing Agent. Just like every home, every offer has strengths and weaknesses. It’s the job of the Buyer’s — er , Selling — agent to play up the strengths, and defuse and/or minimize the weaknesses. from RSSMix.com Mix ID 8230700 https://ift.tt/3cztSNP via IFTTT

Realtor-Speak, Translated I don’t know about other listing agents (representing Sellers), but I have to suppress an eye roll when, following a showing, the Buyer’s agent contacts me and asks to be “kept in the loop” if something happens. That “something,” of course, is another offer. Sometimes, Buyers need a day or two to put together an offer. More often, however, the issue isn’t timing but readiness to buy: the Buyer is just starting their home search, or — if they’ve been looking for awhile — they’re unfocused, indecisive, etc. Role Reversal When the shoe is on the other foot — that is, when I’m representing Buyers — I try to avoid being the agent “kept in the loop,” because I know that when I receive such a call, the price of the home just went up. Instead, I encourage Buyers to do their homework, learn the market, and — when they’re ready to buy and have found something that’s a good fit — to go after it. Without waiting for competition . . . P.S.: None of which is to sa...

Channeling Emily Litella (and Gilda Radner) For obvious reasons, humor is in short supply right now. Which is precisely why it’s so important. If Gilda Radner were still around — and it’s hard to believe it’s been 31(!) years since she has — I know exactly how she’d update her classic comedy bit on SNL: righteously indignant-but-befuddled Emily Litella, whose on-air editorial rants always had to be interrupted, because she got the subject matter just so slightly wrong (example: “Soviet Jewry” vs. “Soviet Jewelry” and her consternation over “The Deaf Penalty”). Once she finally realizes her error, she comes to a confused halt, pauses, then sweetly mutters . . . “Never mind.” In that vein, I offer the following: “What’s So Bad About Social Lists?!?” Emily Litella : Why is everyone making such a big fuss about social lists? I LOVE social lists! How can you be an organized person without social lists?? I’ve got one social list for my neighbors, another for my Mahjong friends, a...

A River Runs Through It (Diagonally) Quick! Test your knowledge of Minneapolis’ quirky geography (or at least, quirky neighborhood names), and see if you know which of the following are real terms, used by the locals . . . and which aren’t: A. “North Minneapolis” B. “South Minneapolis” C. “West Minneapolis” D. “East Minneapolis” E. “Northeast Minneapolis” F. “Northwest Minneapolis” G. “Southeast Minneapolis” H. “Southwest Minneapolis” Answer key : A. “ North Minneapolis .”  Yup , there is such an area: it’s the collection of 13 city neighborhoods that run from Harrison, almost directly west of Downtown, to Shingle Creek, in the city’s far northwest corner. Which begs the question, “why isn’t it called “ Northwest Minneapolis??” Complicating things further: “North Minneapolis” splits into northern and southern halves: “Camden” and “Near North,” respectively. The dividing line is Lowry Ave. B. “ Northwest Minneapolis.” Nope. See , “North Minneapolis.” C. “South Min...

Ironically, the better Realtors get at helping clients buy and sell real estate . . . the worse they can get at certain related tasks. Here are three areas where it’s easy for agents to let their skills atrophy — or never acquire expertise in the first place: One . Market reports/updates. Show me a listing agent (representing Sellers) who’s hyper-proficient providing their clients with regular market updates . . . and I’ll show you an agent whose listings take longer than average to sell. It’s axiomatic that, homes that sell quickly, don’t require explanations for why they’re not. The two major exceptions:  a) more expensive homes, that routinely require longer market time; and b) Buyer’s markets (remember those??), where everything takes longer to sell. Two . Arbitration/Litigation. How do you become an expert in post-closing litigation (or arbitration, if both parties agreed to that)? Be involved with a deal that went (very) sour. I’m happy to report that, after almost...

But First . . . a Brief History Lesson I don’t know about other states — I’m only licensed to sell real estate in Minnesota — but here, residential property taxes are due twice a year: May 15 and October 15. Those non-randomly chosen dates stretch back to when Minnesota’s economy — like practically every other state’s — was agrarian-based. The two times a year farmers predictably had money were in the Spring, before they’d planted; and in the Fall, after they’d harvested. Tax collectors — no dummies about such things — realized that those were the best times to dun its citizens for property taxes (note: the May 15 payment covers the first half of the year; the October 15 payment the second half*). Debits and Credits Which leaves the more contemporary question, “if you’re selling your house in early (or late) May, do you pay the first half property taxes?” The short answer (or at least mine) is, it depends on whether the Buyer’s lender is escrowing (collecting in advance) for it...

The King Staged Closet Has No Clothes Conventional staging wisdom when it comes to closets (yes, there is such a thing, at least for a walk-in master closet in a more expensive home) is that two-thirds full is optimal. Less than that, and the closet looks too empty; more than that, and it looks too full. I mostly go along with that, with the caveat that leaving an (almost) closet-full of clothes can draw Buyers’ eyes away from the space and towards the owner’s wardrobe, and taste in same (similar to the staging knock on too many family photos adorning the walls). Of course, a closet mostly full of clothes can also look smaller. Spare > Cluttered Which is why I very much like the spare, clean look of the staged closet (above), which is empty save for a well-placed dress form (Note: Sellers of occupied rather than vacant homes don’t usually have this option). P.S.: The staged fridge?!? I wouldn’t have believed it, but a Buyer client on a showing with me last year called my at...

  Which President Does Trump Most Resemble? [ Note to Readers : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced.] In almost 3 1/2 years in office, President Trump has variously invoked Lincoln, Washington, FDR, Bill Clinton, George W. Bush, and Obama (especially Obama) to make his case that he is either: a) a better, more popular leader; and/or b) more vilified by his contemporaries — particularly the press, followed closely by his Democratic opponents. However, in light of Trump’s decision — contrary to the advice of medical experts — to forego wearing a mask during a raging pandemic, I’d argue that he risks comparison with another, more obscure predecessor: President William Henry Harrison braved the cold weather and chose not to wear an overcoat or a hat, rode on horseback to the ceremony rather than in the closed carriage that had been offered him, and delivered the longe...

Real estate investor association clubs can be a great way to find great deals. The clubs offer numerous educational opportunities and networking opportunities as well. The groups can be free or some have a membership fee. Like anything in life, you get what you put into it. If you are willing to go to meetups, ... Read more The post What Can Real Estate Investor Association Clubs Teach You? appeared first on InvestFourMore . from RSSMix.com Mix ID 8230700 https://ift.tt/2SUYHox via IFTTT

Will It Issue a Correction?? [ Note to Readers : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced.]        “If 10% of the economy shuts down for one quarter, that would be considered a 40% decline at an annual rate.” –“Coronavirus Slump Is Worst Since Great Depression. Will It Be as Painful?”; The Wall Street Journal  (5/10/2020). If you can’t follow the math in the excerpt above — and I couldn’t — it’s because there appears to be a mistake: specifically, the “10%” and “40%” are reversed. The mistake is easiest to grasp using concrete numbers. So, assuming that annual U.S. GDP is $20 Trillion (it’s actually closer to $22 Trillion — or was), quarterly GDP looks like this: Q1: $5 trillion Q2: $5 trillion Q3: $5 trillion Q4: $5 trillion. Annual GDP = $20T Now, assume that Q2 GDP — the current quarter that began April 1 — takes a 40% hit due to the Covid-19 pa...

Purchase Agreements, Deadlines, and (Other) Ultimatums [ Note to Readers : The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced.  If you need legal advice, please consult an attorney.] At least in Minnesota, where I sell real estate, deadlines are incorporated into Purchase Agreements, Counter Offers, and other binding contracts much less than you might expect. I think there are three reasons for that. One . They’re unnecessary. Until the other side accepts in writing , the other party may retract whatever it is they’ve proposed. At any time. So, just to pick a not-so-hypothetical, if the Seller is  v-e-r-y slow to respond to the Buyer’s offer, the Buyer can simply withdraw it (and presumably, pursue another property). Two . Deadlines can backfire. What does an aggressive, savvy listing agent do when they get an offer that expires in 24 hours — especially if it’s und...

Avoiding “The Bowling Alley” Effect First, a caveat: unless there’s also a detached garage in the back of the house (typically, off an alley), converting a one-car garage into something else is a non-starter. That’s because going from a one-car garage to a no-car garage is guaranteed to destroy much more value than it creates. But, assuming that that’s not the case, is it ever smart to convert a one-car garage into finished square feet? The short answer: “yes — provided it’s done well” (actually, that pretty much applies to every prospective major renovation or home addition). Goodbye, Tuck-Under Garage! The trick converting a one-garage into finished square feet is the lopsided space: usually, something like 20′ long by 10′ wide. To avoid creating something with a “bowling alley effect,” it’s important to design the space well, and introduce a lot of natural light. In practice, the most popular uses for the space are a Home Office, Family Room/Den, or Exercise Room. Regardle...

Look closely and you’ll see not one but two trunks at the base of this tree, about 1/2 mile west of Minneapolis’ Cedar Lake in St. Louis Park’s Fern Hill neighborhood. The tree — make that tree(s) — command a key intersection, which give passing motorists (and pedestrians) a treat this time of year. P.S.: a (slim) silver lining to this year’s coolish Spring: the prolonged blooming period — I’d guess 5-7 days instead of the usual 3-4. from RSSMix.com Mix ID 8230700 https://ift.tt/3fBhU8o via IFTTT