Jennifer Kirby, the Luxury Agent

Yesterday I sat down to read the paper, something I have not been able to do for well over a week. I never expected to get emotional right off the bat, and when I say emotional, I mean the exact opposite of crying.

When I came across an article about the Minneapolis City Council and their recent resolution regarding local foreclosures, I actually had to walk away from the paper before I crumpled it up and threw it into the trash. Since it was buried on page six of the Pioneer Press, many have most likely missed it.

The non-binding resolution passed by the Minneapolis City Council is calling for lenders to stop foreclosures for the next three months. Apparently the city council thinks that the "pressure" they are putting on local lenders by passing resolutions like this will make banks stop causing families to lose their homes. The only problem with their thinking is that banks make loans, and the common motto told to buyers upon signing a mortgage is if "you don't pay, you don't stay". Further, the last time I checked, families lose their homes because they break the agreement they signed with the lender and stop paying their mortgage, not because lenders are throwing darts at a dart board to see who they can foreclose on next.

Now, don't think the council came up with the idea themselves. The group, ACORN (Association of Community Organizations for Reform Now), pushed for the vote and is thinking about getting the Saint Paul City Council to pass a similar resolution:

"the 25 largest subprime mortgage lenders agree to a three-month suspension of foreclosures of owner occupied properties in the city" and further asks lenders "to make every effort during suspension period to help customers avoid foreclosure and remain in their homes".

They also want those facing foreclosure to get their rates reset or modified to allow them to afford the loan. The council further said,

"Tough times require real solutions, not rhetoric...I hope everybody feels good about hitting banks over the head with a stick, because that's what we're doing".

I have a question, why should we feel good about giving it to the banks? You know, I would really like to borrow their stick and hit them over the heads with it and ask, "What are you thinking?". The Minneapolis City Council should not be wasting their time coming up with useless resolutions like this one. The "symbolic" gesture won't do any real good, but the time wasted cannot be given back to topics that might actually help local homeowners, like, hmmm....lowering property taxes.

The fact is, when buyers sign the note on their new house, they make an agreement with the lender, stating they will make monthly payments and pay back the loan. It is their responsibility as home owners to make sure they understand what they are signing. I have sympathy for those facing foreclosure because my family almost went through it. But I was raised to take responsibility for your actions, even for those that stink, and the thought of the government coming in and bailing out people facing foreclosure, or worse, forcing lenders to fore go foreclosures, is a little scary to me.

When did it become public policy to bail out anyone that makes a bad decision?

During the boom, business was booming for builders. It seemed I would wake up in the morning, drive to the office, and see a new development going up on the way. I wondered, "Geez, where are all these buyers coming from". After a while, I started to figure it out.

Here is a story that beings during the boom:

One weekend, a few years back, I had a buyer who wanted new construction. They had heard about a new neighborhood going up and wanted me to take them by for a look. Needless to say they loved the neighborhood.

Being the dutiful Buyer's Agent, I started asking questions to the sales agent and was a little disturbed by what I heard. She told me they only had a few lots left so my buyers should act quickly. I commented how the neighborhood had just gone active two week prior and asked how they could be so low on lots. She informed me that 27 of the 30 lots had been bought by one investor from south Florida. He was building homes on every lot and then would sell them upon completion. Flipping them for profit. I turned to my clients and advised them they might want to reconsider the location because there was no telling what would happen to the neighborhood since a investor had bought almost the entire thing.

Hate to say it, but they did not take my advice. They put a home under contract and moved in six months later. They called me a year later, wanting to sell their home because they no longer wanted to raise their kids in the neighborhood. When I asked why, they said that the investor had not been able to sell most of the homes he built and was instead renting them out on the cheap. To them, the area was no longer safe because the entire neighborhood was renters. (Not to bash renters, but many just do not care for a home like a home owner would.) I had to tell them they were more than welcome to sell, but that the market had crashed and they would have to sell for less then they owed. It was not a pretty sight.

But my point of the story is that too many builders sold to "investors". (I have a hard time calling them that because a true investor holds for the long term. Short time investors should really be called "speculators" because they are speculating the making of money in a quick amount of time.) When the builders sold to investors, it artificially increased the need for housing. So builders kept building, and I kept seeing new neighborhood after new neighborhood going up.

Now builders are finding themselves in the position where they need to unload lots of inventory. The speculators are gone, and so are the buyers. In order to keep themselves out of financial trouble, they are turning to events like the upcoming New Home Auction in Minneapolis. Many could have kept themselves out of this type of situation if they just would have had the courage to pull back on the reigns. But sadly, the need to profit out weighed the need to look into the future and see that the roller coaster ride was going to come to an end sooner or later.

If would be interesting to know the balance sheet for builders, the boom years profit, versus the losses when the bottom fell out. I really wonder if they made any money over the long term. If you have any interesting statistics, I would love to hear them!

If you read my blog, then you should know that I love photography. Sometimes words alone cannot express the beauty of a sunset, or the serenity of one simple gorgeous flower growing in a field. But great photography doesn't have to stop with nature.

For the most part, photos tell a story. Real estate unfortunately has always been thought of as just "selling a home". Many agents neglect, or fail to see, that selling a home has become so much more. Buyers want to hear the story of the home and know the home has been loved. In addition, especially on high-end homes, the number one thing to sell is the lifestyle story. What better way to do this then through pictures.

More goes into a photo then point and shoot. Lighting is probably the most important aspect of a great photo. The living room shot above has perfect lighting which presents a sense of warmth and relaxation to a buyer. The lighting is created to get this type of shot. One cannot just go into the room, shoot, and walk out with a fantastic photo. You actually have to work at it to get such perfection.

When marketing a luxury home, photography is the most important thing to me. If I don't have great photos, how will I ever capture the attention of an affluent buyer? In fact, sometimes the photos need to be of the view, or of the lifestyle that will come with the home. Affluent buyers need to sold. They are not going to just flop down a couple million just because they can, as least not here in Minnesota. They want to know that they are not only making a sound investment, but they also want to know they will be able to live in and enjoy the luxury estate.

So when it comes time to put your luxury Minneapolis home up for sale, make sure the agent you hire has a marketing plan that includes professional photography. It will make all the difference in capturing the buyer's attention. If you don't, chances are your home will be languishing a long time on the real estate market, and the word "price reduction" might be uttered in your agent's next conversation with you.

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If you would like to learn more about Minneapolis Luxury Real Estate, visit my outside blog.

This weeks showcase Historic Home is 339 Summit Avenue.

Built in 1898 by Crawford Livingston at a cost of $14,000, the home was designed by the famous Cass Gilbert. With a Gothic / Medieval design, there is no other home quite like it in the area. Whereas most homes have a distinct porch, this home is designed with the second story coming forward to be flush with the lower story. The arches are very beautifully done with the short Corinthian columns, and the diamond shaped spandrels are very unique.

Originally built as a single family residence, the home is presently divided into 5 condominiums, each having two bedrooms and somewhere between 1400-1800 square feet. The last condo unit sold in 2002 for $275,000. If the home were to sell today as one building, it would fetch well over $1 Million.

I found two old photos of the home. The first was taken in 1902, the home being the second from the left. You can really see how the streetscape looked at the turn of the 20th Century. The second is from 1973, during winter. The home thankfully has not been altered on the exterior throughout it's lifetime.