Today, I’m joined by a special guest, Kim Lindquist from Edina Realty Home Warranties. Kim has been in real estate for over 25 years. She started on the warranty side about four years ago. We’re going to discuss what a warranty is and a few of the benefits of home warranties.

What is a home warranty?

A home warranty is a one-year service agreement that covers repairs and replacement of items due to normal wear and tear. One benefit for a buyer would be budget protection after you’ve purchased a home and maybe spent a lot of your savings to do so.

How does a home warranty benefit a seller?

There are three main benefits for sellers. The first is that the home warranty is not due until it closes, so it’s free during the listing period. The second is that the warranty offers peace of mind for the seller (and for the buyer when they move in). Finally, home warranties help prevent wholesale disputes.

What happens if there is a claim? What does the process look like?

“Filing a home warranty claim is very simple and easy.”

Let’s say you have a leaky pipe underneath your kitchen or bathroom sink. You would simply go to www.onlineHSA.com and click “Register Claim.” You can also call us at 1-800-367-1408. Say, “Service,” and then “Customer service” to speak with a live rep that will help you file your claim. It is very simple and very easy. We are open 24 hours a day, seven days a week, 365 days a year.

Are there different coverage options for buyers and sellers?

Absolutely. For sellers, we have an option for single-family properties at $485 with a $75 deductible or $465 with a $100 deductible. The seller can also add heating and air coverage for an extra $60.

When a buyer closes on the home and moves in, there are other options we can add as well. We offer a 7-star buyer upgrade and many other options to add on. If you have an extra freezer or refrigerator, you can add that coverage. You have 30 to 60 days after you close to add coverage.

If you have any other questions about home warranties, you can contact Kim Lindquist at 952-210-9809 or [email protected]. As always, you can contact Sara and me with any real estate questions. We would be happy to help you!

Today, we’re going to be talking about repairs in the inspection contingency period.

It’s pretty common for buyers and sellers to have two very different ideas of what the repairs are intended to be, or what is actually asked for. It is important for a buyer to be very clear when asking for repairs on their inspection amendment. The seller would need to know what repair the buyer is asking for, if they’re asking for a licensed contractor to do it, or if the repair is something that the seller themselves could do. Additionally, the seller will want to know whether a paid receipt or photograph is required to verify that the repair has been completed, as well as whether or not other specific items are necessary.

For example, just a simple amendment saying to repair the roof wouldn’t be very clear. We would need something more specific like what about the roof needs repairing and if a roofing contractor is required for that task.

On the seller’s side, when you receive an inspection amendment request, you want to be sure to take that request literally. Do what the buyer asks for, not what you think they’re asking for. As an example, suppose that you have a leaky pipe under a sink which the buyer specifically asks you to fix. That doesn’t mean that you have to hire a plumber to do it; you could ask your dad or a handyman since they never specified who needs to make the repair. If they ask for a radon system to be installed by a licensed professional, you have to have said professional do it.

“It is important for a buyer to be very clear when asking for repairs on their inspection amendment.”

Sellers should make sure they get paid receipts, lien waivers, and photographs when they’re applicable so that there are no doubts on final walkthroughs.

Once the buyer closes on the property, it means that they have accepted the property in its current condition, so it’s important for the buyer to ensure that they’re satisfied with the repairs that were made.

We are strong at dealing with inspection negotiations because these types of issues come up in all sorts of ways. If you have any questions about this, feel free to give us a call anytime. We look forward to hearing from you.

Today, we’re going to over the standard closing cost that a seller can expect to pay when selling their home. We’re going to going through a quick, estimated seller’s net sheet that we present to all of our sellers and for anybody who requests a market analysis from us, breaking it down into different categories.

1. Governmental costs. There will be a conservation fee, which our title companies like to call “feeding the ducks.” There are also recording fees, which are dependent on how many mortgages you have and anything that needs to be recorded. Additionally, there is the state deed tax, which is $3.30 per $1,000 of the sale price.

2. Title costs. These are fixed fees that the title company will charge you to close the file, run the payoffs, do searches, etc. Included in this fee might be a courier fee, if your lender requires a payment to be overnighted.

3. Broker fees. These are broken up with commissions and broker admin fees.

“A buyer may sometimes ask the seller to contribute to the buyer’s closing costs.”

4. Miscellaneous costs.These may pertain to acreage properties if they’re using a private well or septic system, which may require inspections. Home warranty fees are also typically paid for by the seller. If you live in an HOA, the seller will have to order what’s called a resale disclosure package, which is sent to the buyer. Additionally, a buyer may sometimes ask the seller to contribute to the buyer’s closing costs; this is a negotiable item which we counsel our sellers through, depending on the type of buyer and the type of loan they’re taking out.

5. Fee proration.Association fees and property taxes are prorated.

Above and beyond the commission rate that is negotiated, you can expect to pay about a half of a percent, with three quarters of a percent of the sales price in standard, fixed closing costs.

If you have any questions about a net sheet or closing costs, feel free to reach out to us. We’d be happy to run a market analysis and prepare a net sheet for you, as well as walk you through them.

For our a look ahead at our spring market, we’ll focus separately on the Prior Lake Savage and Shakopee areas and talk about how inventory levels are shaking out in three distinct price ranges.

The first of those price ranges is the first-time buyer market, which typically represents homes priced up to $250,000. In both Prior Lake Savage and Shakopee, there is no new construction in this level of inventory. What’s really interesting, though, is that the number of active listings and the number of pending listings in both communities are identical. This tells us that though first-time buyers may not be able to build a new home, the inventory that is coming on the market is moving at a nice clip.

The second price range is the move-up buyer market, which is roughly between $250,000 and $400,000. This market is slightly different in both Prior Lake Savage and Shakopee in that there is some new construction inventory. However, existing inventory tends to pend or sell faster in this range because move-up buyers look for value, and you can often find better value in the existing market where home features like decks, patios, gutters, and window treatments are already done for you.

North of $400,000, it’s an entirely different ball game. There is a lot more pending inventory and an extensive amount of active inventory because there are fewer buyers.

“Pay attention to prices as more inventory comes on the market.”

What does this mean moving forward in 2018? It means first-time buyers will predominantly stick to existing inventory. Above the $400,000 mark, there will be a lot of new construction inventory and existing inventory because we’re already in a low-inventory market in general.

Considering inventory levels are so low, make sure you make a smart buying decision if you are a homebuyer. By that we mean pay attention to prices as more inventory comes on the market during spring and summer because they may get inflated. Also, remember that interest rates are still low and very competitive.

As always, whatever you do, make sure you have an experienced agent on your side. If you have any questions about our market or you’re thinking of buying or selling a home, don’t hesitate to reach out to us. We’d be glad to help you.

Why is it important to get a look at your home’s current market value, and what are the benefits of knowing that information?

This is a good time of year for people to assess their current home. We can come out, take a look, and give you an idea of what your home’s value might be.

People often like to ask us about what they can work on to improve the value of their home while maintaining the property and keeping it up to date. We can help determine what you need to do to keep your home in good condition.

Even if you’re not selling in the next couple of months—or the next couple of years—it’s good to have a baseline of the market value of your home so that you can make a decision based on its value in the future.

“It’s important to know your market value because our market is constantly changing.”

It’s also good to understand your market value because of all the changes that happen in our area. Our market sees a lot of new construction, commercial growth, and farms being bought and sold that may soon be developed.

As a result of all this change, people want to know, “Is it a good time to sell? Are market values going up or down?” Knowing where your home currently sits in terms of market value will give you a sense of comfort, as well as an idea of what your future home sale could look like.

If you would like a home valuation, or if you have any other questions, just give us a call or send us an email. We would be happy to help you!

Today we want to take a quick look at the home buying process.

If you’re a first-time homebuyer, the first thing you need to do is have a conversation with us. We’ll talk about your wants and needs, the areas you’re looking at, and how we can get you into contact with a loan officer so that you can get pre-approved right off the bat. This will answer a lot of initial questions.

“There are a lot of moving pieces, but we can help you work them out.”

If you’re a homeowner who is going to be buying and selling a home at the same time, we have a bit of a different puzzle. First, we’ve got to evaluate the equity in your current home. You may be able to qualify for a pre-approval before selling your current home. You might have to sell first in order to make an offer, however. That’s the puzzle we have to piece together.

There are a lot of moving pieces, but we can help you work them out. If you have any questions for us or if we can help you buy or sell a home in any way, give us a call or send us an email. We look forward to hearing from you.

When people think of buying a home, they often naturally gravitate towards the spring market. As a result, spring is a common time for buyers to enter the market.

However, buyer traffic is very heavy in the springtime. In low inventory markets, some of our listings may get as many as 25 to 30 showings over the course of one weekend in the spring. As a buyer looking to buy a home, particularly a first home, it can be intimidating to buy a home in the spring. It may even feel hopeless at times.

The benefit of trying the market in an off-peak season is that the buyer is able to explore what’s out there without all of the competition. Shopping for a home in off-peak seasons like fall and winter also increases the likelihood that you will find a home.

“You will be able to explore your options without all of the competition.”

If you are searching for a home this winter, we recommend that you get written verification from sellers regarding certain winterization projects.

After all, the AC unit should be shut off and the sprinkler system should be winterized, which means the inspector won’t be able to test them in the winter. Just ask for the seller to confirm that those things were working before they were properly shut down in the fall.

If you have any questions about buying a home in the winter market, just give us a call or send us an email. We would be happy to help you!

It’s time for your fall real estate market update.

Just like this past spring and summer, inventory is low across the board. The market did slow down in August as families wrapped up vacations and went back to school. That slowdown can often transition into early September, so we do see the market pick up again in late September, October, and into Thanksgiving.

So, if you are thinking of buying or selling a home, the market is still active during this key part of the season.

We’d also like to touch on some new construction development that’s been going on lately.

If you drive down County Road 42 in Prior Lake, you’ll see a lot of activity. Pulte Homes and Lennar Homes are clearing a lot of trees for new developments on the south side of 42. There will be single-family homes and townhomes.

“The market does pick up again from late September.”

Lennar and Summit Preserve will also be building single-family homes and townhomes. M/I Homes, formerly known as Hans Hagen, will also be building some properties around that 42 corridor.

In Shakopee on County Road 16, Lennar is also building a lot of homes. We’re talking hundreds of lots. Although there is a lot of building going on, those properties are not included in our current inventory numbers.

Next year though, you will see some big changes in inventory. There will be a lot of lots available and the market will be pretty competitive.

All of that said, this actually could be a very good time to look at buying or building a home. The fall season is still a good time to be in the market. A lot of people are busy with their kids’ sports and activities. If that’s not taking up a lot of your time, then now is a good time to look at the homes that are available because you will have less competition.

If you have any questions about our current market, please don’t hesitate to reach out to us. We would be happy to help you!

There are two components to representation in a new construction transaction. The first is your representation during the actual purchase of the site of the new home. The second is when you have a home to sell in order to purchase a new construction home.

When you buy a new build site, it’s important to know that the agent at the model home represents the seller. In this case, the seller is the builder. It’s important that the consumer realizes that the agent represents the builder’s best interests.

As a buyer, if you want to make an offer on a new build property, working with a buyer’s agent can be very important. We’ve seen a lot of people fall in love with all of the beautiful, shiny things that new construction has to offer. In terms of resale, it’s important to work with an agent who works in the existing resale market to figure out what you can do to make the home of value to others in the future should you ever decide to sell it.

For example, we often see people put stainless steel appliances and granite countertops above a third garage stall in terms of importance. If you’re building a $500,000 house, the third stall is just an expectation at that point.

“An independent agent will represent your best interests over the builder’s.”

The second component of representation is when you are building a new home but have an existing home that you need to sell first.

Oftentimes, the builder won’t begin digging on your new home until you have your existing home under contract. Something to consider when evaluating which agent to sell your home is whether they are independent or work with the builder.

An independent agent may have more of a voice for you in terms of your unique situation. They will work to get the best price possible for your home, as well as the best possible terms. An agent who works with the builder is focused on selling your existing home so that you can get into your new house.

Ultimately, whether you work with an independent agent or an agent attached to the builder depends on your unique situation.

If you have any questions about buying a new construction property, just give us a call or send us an email. We would be happy to help you!

Here in the state of Minnesota, there are two types of seller disclosure statements.

One is the seller’s property disclosure statement, also known as the full disclosure. There is also an alternatives form, which is only used in certain circumstances.

Usually, though, a seller will use the full property disclosure statement. This is a very lengthy, 10-page document that goes through everything a prospective buyer will need to know about the condition of the property.

The full disclosure form will ask about the age of the roof and if the mechanical systems and appliances are in working order. If you have a private well or septic system, those need to be disclosed as well.

“If you’ve done a radon test in the past, you need to disclose the results.”

A couple of years ago, our state added a radon disclosure piece as well. One of the most common questions we get from prospective sellers is, “Do I need a radon test?”

The state of Minnesota does not require a radon test prior to selling your home. However, if you’ve had a test completed in the past, you do need to give the results of the test to any potential buyers of the property.

There will be a radon warning statement attached to the disclosure statement. The radon warning is a two-page document provided to the buyer at the time of their purchase agreement.

If you have any other questions about seller disclosure statements or real estate in general, just give us a call or send us an email. We would be happy to help you!