Lakes Sotheby's International Realty SHIPMAN + KOLKMAN PARTNERS

Building and remodeling projects usually involve some discussion of value, or the return on investment. One of the often overlooked, and most valuable investments of any project is design. At every step, Architectural, Landscape and Interior Design have great return. Builders employing good design are finding success, even in today’s challenging real estate market.

Everyone wants to save money; do-it-yourself home owners, house flippers, speculative builders, even private remodeling projects, we all look for opportunities to cut costs. Especially in tighter times, we all want to do more with less.

But when success depends on profits, as is the case in speculative (spec) building, or house flipping, or even in private homeowners who want to increase home equity through home improvements, design is a critical component that can make all the difference.

Two examples of successful Minneapolis builders using design to build better homes and beat their competition are Replacement Housing Services* and Great Neighborhood Homes. Working primarily in Edina, MN both of these builders continue selling new construction spec homes in the most challenging market conditions ever seen. What’s their secret? If you ask me, its good design. The neighbors love these projects, as do the investors and lenders financing them. Look at the homes on their websites. The difference is clear.

Imagine two home built with similar budgets, sizes, features and amenities. The first one being well designed, architectural, based on other neighborhood housing styles, inspired by classic designs, complemented by modern features. The other home, simply built on the same standard builder “McHome Plans” used in millions of suburban communities throughout the country. Which would you prefer?

There is a fee for good design, of course, but the return is a home that stands head and shoulders above its peers.

While most builders face hard times (bankruptcy) today, the few who are building on spec successfully (and who still get funding to do so) are employing good designers at every step of their projects.

*The author is a member of the Replacement Housing Consortium, and provides real estate services to Replacement Housing Services.

Today’s real estate market is Bi-Polar. And there are no drugs to help a mentally ill real estate market; we just have to deal with it.

The two sides, or personalities, to this dysfunctional market; Bank Sales (Foreclosure, and Short Sales) and the good old fashioned Private Seller. The horror stories are common, the Bank refused to negotiate, or took months to respond, closing was delayed. While the prices on Bank homes might look attractive, buying from Banks take lots of patience and a flexible timeline. Private Sellers on the other hand, easy to deal with, willing to negotiate, and generally close on time, without any “hiccups”.

Sure we all want a deal, and we instinctively feel that buying a Bank home must be the way to get it. But, what is the value of time? What’s it worth to have your deal go smoothly?

Many of today’s more savvy (or perhaps “experienced”) Buyers have asked not to see Bank homes at all. After a few failed attempts at buying from a Bank they’ve thrown in the towel. In the words of one Buyer, “Just give me a good old fashioned seller who can actually sell their home to me”
Unfortunately Private Sales with out any Bank involvement are hard to come by in many price ranges.

Buyers believe me; Banks may “want” to sell, but their own bureaucracy gets in the way. Only cash investors with iron stomachs are truly set up to deal with the Banks terms and requirements.

Sellers listen; If you want to sell but don’t want to “compete” on price with these Bank homes, don’t worry. Get your home on the market! There are good Buyers looking for good ‘ol fashioned Sellers with nice homes that they can buy straight up, without hassle

Good Luck! - Ben Kolkman

Realtor, Sotheby's Realty, Minneapolis, MN

A shift has taken place in our real estate market. Not the shift you might be thinking. Today’s urban neighborhoods are being redeveloped as older homes succumb to new construction and whole house remodels. This trend radically changes the buying and selling dynamic, as land and structure values must now be valued independently. This change effect all buyers and sellers regardless of price rangeand the key to makeing a smart real estate decession is understanding the trends, patters, and pricing in these areas.

It’s no surprise this trend has taken root. For years now, good schools, safety, low taxes, commute times, convenience, and real neighborhoods have been drawing weary suburban dwellers back to the city, back to the best areas of the “sustainable urban core”. The demand for these primier neighborhoods brings in developers and builders working on spec tearing down and building new. Individual owners, the private citizen is also responsiable for a great deal of these developments.

It's not just the rather well to do who need to be aware of this shift. Everyone, regardless of price point, can take advantage of this trend. First time Buyers for example looking for an entry level home should be buying into development patterns, and looking at land prices. Buying the right “starter home” could end up being transformed into your “dream home” idown the road. Of course move-up buyers and downsizing buyers can ride this trend as well by understanding the price ranges and finish levels best suited to their neighborhood market.

And Sellers, you’ve the best opportunity of all. Have you considered selling your home as a “to be built” home? Working with the right realtor, and builder, you might be able to transform your current home, from what it is today, into a perfect fit for today’s market and today’s buyer. You don’t necessary have to complete the renovations. With the right builder/realtor team you can sell the home as a “to be built” project. It does take a New Construction sales skill, because your selling an intangible product and most realtors are use to selling a product their client can touch and see. So choose well.

Lower price ranges are suffering long market times and falling prices. Meanwhile higher price points are selling as well as ever. Sellers of homes in Edina, Southwest Minneapolis, Golden Valley and St. Louis Park should all consider their options. Working with a builder who’s successful in the current market who has examples of their work available, and a realtor who can develop trust and confidence in the project, you can transform your home from an OK product into a “perfect fit” for the current market, sell it fast, and for a higher net proceeds in most cases.

Todays quality neighborhoods, closer into the city, area a dynamic and every changing market place. Homes at just about every price range, style, and condition can be found. Making a smart choice about what to buy, and how to sell, requiers a comprehensive knowledge of the areas price celings, land values, and development patters.

Ritz Crackers agrees - Minneapolis is a fun city!

The study looked at residents participation in social activities such as block parties, barbecues and access to parks, dog parks, gyms, movies, theaters. Bert Sperling of Sperling’s Best Places conduted the stuy which Ritz sponsored and ranked the top 50 metro areas.

Our Minneapolis park system and the number of tennis courts, ice rinks, baseball fields and golf courses won us the number 2 spot over San Francisco. Seattle won the top spot.

Hey all - Just a quick note here. The Q1 Foreclosure Report from MAAR is out now...

http://www.mplsrealtor.com/downloads/market/Lender-Mediated/Main.htm

These are a huge segment of the market place. Some areas only have 5% foreclosure rates (Edina) while other are near 60% (Camden, North, Brooklyn Center). These number remain largly unchanged from last quarter.

We break these out from "Traditional Sales", for two reasons, they are skewing market statistics, and because many buyers have grown tired of trying to buy from banks and rule these homes out entirely.

While it is true, there are great deals in the foreclosure market, banks often take MONTHS to respond to an offer, good properties regularly attract multiple offers, and there can be issues securing financing for homes in marginal condition.

Listen to this Marketplace Report from American Public Media on Buying a Bank Owned Home

It is getting easier to buy these homes, however, as the industry responds to the situation. Lately I've been seeing more "pre-negotiated" short sales, and professional mediators in the market. Banks are also listing property at lower prices to move it fast.

Best of Luck Out There! - Ben Kolkman

Lakes Sotheby's International Realty

(612) 599-4161