Steve Jecha

It looks like things are hitting a bottom. Banks are tired, prices have dropped precipitously.

I work with investors and also with banks on foreclosure properties. Here are just a few of the recent deals that have come up:

1311 Wagon Wheel Road, Hopkins, MN - A townhouse located in Minneapolis' suburb, Hopkins. 2 Bedrooms, 2 baths with a 2 car tuckunder garage. How much? $62,500! It would rent for $1,000 a month minimum and with 20% down, it would cashflow right out of the gate.

2630 Humboldt Avenue North - Here is a two story, 3 BR/2BA home. Needs some work as plumbing has been stripped out of it. Sold two years ago for $187,000...went on the market today for $17,900! It will sell fast....I anticipate within the next two days I will have offers.

I have many more like these coming on the market in the next three months. Now is the time to make money in real estate!

Want to get in on the upcoming deals? Great opportunities are all over the place. Email me today at steve@jecha.com for my daily foreclosure list.

The Twin Cities Metro has seen the real estate bubble burst in many areas. Reviewing stats from the Minneapolis Area Association of Realtors, it shows what areas have been hardest hit by this tsunami. Here some stats for you to chew on:

10 Twin Cities areas where foreclosure and short sale listings make up the greatest share of homes for sale. Since these properties take a much bigger price hit than conventional home sales, this is in part an index of downward pricing pressures in those areas as a whole: 1) Brooklyn Center, 65.9 percent; 2) Minneapolis North, 64.9; 3) St. Paul Central, 59.1; 4) St. Paul Phalen, 58.8; 5) Big Lake, 56.8; 6) Minneapolis Camden; 56.3; 7) St. Paul Hillcrest, Hazel Park, Dayton's Bluff 56.0; 8) Spring Lake Park, 54.1; 9) Minneapolis Powderhorn 53.9; 10) Brooklyn Park 52.7.

10 local areas where the prices of foreclosed or short sale properties saw the biggest year-over-year drop. This offers a graphic reminder of how much poorer the Twin Cities's poorest areas are getting as a result of this crisis: 1) Minneapolis Phillips, -52.6 percent; 2) St. Paul Central, -44.9; 3) Minneapolis Camden, -43.9; 4) St. Paul Hillcrest, Hazel Park, Dayton's Bluff, -42.7; 5) St. Paul Riverview/Cherokee -41.0; 6) Minneapolis Powderhorn, -37.9; 7) Hopkins, -36.7; 8) Minneapolis North, -36.6; 9) St. Paul St. Anthony/Midway, -35.0; 10) Northeast Anoka County, -33.0.

10 local areas with the biggest backlog of "traditional" (i.e., not foreclosed or otherwise bank-involved) sale listings. Think of this, in part, as a testament to how unattractive and overbuilt the far-flung suburbs have become, and potentially a harbinger of foreclosure increases to come: 1) Lakeland/Afton/Denmark, 23.7 months' supply; 2) Hennepin Northwest, 21.5; 3) Ham Lake, 21.3; 4) Southern Chisago County, 18.8; 5) Northwestern Anoka County, 18.6; 6) Lake Minnetonka area, 18.1; 7) Prior Lake, 17.0; 8) Northfield, 16.9; 9) Northeast Anoka County, 16.6; 10) Stillwater/Bayport, 16.3.

On the positive sides, there has been a decline in inventory on the market over the last two quarters. While there is still considerable inventory in the marketplace, as inventory declines, the pendulum will begin to shift back to a sellers market. But don't think this will happen overnight. It will be at least a few years of flushing out the foreclosures before we can take a deep breath and have the housing market return to normal.

As I advise my clients, the problem with the current market is the 'food chain' is broken. In traditional markets, people buy starter homes and as their careers change and their family dynamics change they move up into larger homes. The problem is that with all of the foreclosures, that food chain is highly damaged. People who were counted on to 'move up' are few and far between. Those that are ready to move up find that any equity they had to put towards their next home has been squeezed out of their current home. Thus, they are stuck....and so is everyone that lies up the food chain.

Hang in there.....things will get better.

A recent study by Economy.com states that the housing cycle should hit the 'bottom' later this year. In many parts of the country, and localized in certain areas of the Twin Cities, home prices have dropped by over 32% from the peak in the first quarter of 2006.

Think we have had it bad here in the Twin Cities? How would you like to live in Naples, Fl where prices dropped by 70.1% and a bottom is not expected to hit in that market until the fourth quarter of 2010. Other areas in Florida and California have seen prices fall by over 50%.

From what I have seen in Minneapolis and the overall Twin Cities is this: certain pockets and neighborhoods have been hit hard. North Minneapolis is in tough shape. You can drive up a city block and see four or five For Sale signs. Suburbs that were experiencing growth through building, like Maple Grove, Woodbury, Andover, New Prague, etc. have been punished. I am aware of situations where people bought their home in early 2006 in the $650k range and today they would be likely to get in the $450 neighborhood --- why? because builders, desperate for cash, have been fire saling their inventory. When you can get a fire saled brand new house for next 2 nuthin, why would you pay a premium for a gently used home?

Recently, year over year home sales of existing homes increased. That is a good sign. Here will be the best sign for you to look for: housing prices of existing homes increase in year over year statistics. This will mean we have hit the bottom and now we are starting a trend upwards....or at least flattening.

Got any horror stories on pricing drops in your area? Comments?

Here is my listings hot sheet for current foreclosure properties in Saint Louis Park, MN. If one of them interests you I can send you the full MLS Listing sheet via email.

The process for buying a foreclosure property is very similar than buying from a traditional homeowner, except the sellers are banks and the asset managers are unemotional about their properties.

I both list and buy REO ("Real Estate Owned"/foreclosure) properties. I work closely with banks and their asset managers and do a substantial number of Broker Price Opinions on their property portfolios in the Hennepin County area. Because of my knowledge in this market I can provide buyers with detailed information on how they can get a great deal or what properties may be coming up (leaving the foreclosure process called 'redemption').

Watch this site for more details on foreclosure properties currently on my listings hot sheet. If you have a zip code or city that you would like this information on, please contact me via this website.

I hear it every day, "How can my property taxes be going up when my home price has dropped 20% in the last year?"

Well....you have to protest your property tax because the government usually likes their assessments and they aren't going to do anything unless you are a squeeky wheel.

But, what I have also found is that clients have no idea how to proceed, nor do they have the time or expertise to do what is needed to successfully protest their taxes.

So, I have started a new niche business within my real estate practice for those who live in the Hennepin County area....here was the press release that was distributed last week:

Gopherhomes.com Announces Launch of New Residential Property Tax Consulting Business for Twin Cities Homeowners

Minneapolis Realtor launches Property Tax Consulting services to Minneapolis and Twin Cities Homeowners that have seen large drops in value to their homes.

Minneapolis, MN, February 12, 2009 --(PR.com)-- New Service Aimed at Helping Homeowners Reduce Their Property Taxes in the Current Marketplace.

With home prices down over 20% in many areas of the Twin Cities, property taxes haven't followed the trend.

"People are realizing that their property taxes aren't going to be reduced unless they step up, roll up their sleeves, and do the work themselves," stated Steve Jecha, a Realtor with Coldwell Banker Burnet and the Founder of Gopherhomes.com (www.gopherhomes.com). "There are many areas of the Twin Cities and Hennepin County where a homes Fair Market Value in today's market is substantially less than the Counties Estimated Market Value."

Homes for sale from Minneapolis to Maple Grove have plummeted over the past two to three years, and those homeowners who purchased their homes ‘at the peak' of the Twin Cities real estate market now may have an over appraised market value.

For years, property tax appeals have been commonplace in the Commercial Real Estate marketplace. With the declining residential real estate market, there is a large opportunity for homeowners to take advantage of the appeal process.

Gopherhomes.com charges a one-time $195 fee which provides homeowners with a comprehensive market valuation package that includes everything they need to appeal their market value with their local appraiser. For homeowners that do not want to do the work, or are intimidated by the process, Gopherhomes.com will handle the appeal process on a contingency basis - if they win, they get paid.

"There are homes all over the Twin Cities that are over appraised by $100's of thousands." Jecha continued, "Homeowners can call us at 952-924-6254 for a free conversation and review regarding their property and whether it is worth pursuing an appeal."

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www.gopherhomes.com

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Call me or email me with questions regarding this service and how I can help you.