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Curious about local real estate? So are we! Every month we review trends in our real estate market and consider the number of homes on the market in each price tier, the amount of time particular homes have been listed for sale, specific neighborhood trends, the median price and square footage of each home sold and so much more. We’d love to invite you to do the same!

Get Local Market Reports Sent Directly to You

You can sign up here to receive your own market report, delivered as often as you like! It contains current information on pending, active and just sold properties so you can see actual homes in your neighborhood. You can review your area on a larger scale, as well, by refining your search to include properties across the city or county. As you notice price and size trends, please contact us for clarification or to have any questions answered.

We can definitely fill you in on details that are not listed on the report and help you determine the best home for you. If you are wondering if now is the time to sell, please try out our INSTANT home value tool. You’ll get an estimate on the value of your property in today’s market. Either way, we hope to hear from you soon as you get to know our neighborhoods and local real estate market better.

Searching for the right house can be an exhausting process for many buyers.  When you finally find it, you’ll still have many steps before the transaction is complete.   The first step is making an offer.  Here is some useful advice we always share with our buyers on how to make an offer more attractive to sellers from their point of view.

Make a Realistic Offer

Making a realistic offer based on market values demonstrates that you’re a serious player and not looking to jerk the sellers around.  A lot of buyers think they should low ball and come in under the asking price.  While this is possible in various situations, you want to make sure that your offer is realistic and that you don’t turn off the seller. Proper market research allows us to determine what is realistic while also providing comparable data to support your offer.  Remember, knowledge is power.  This is one of the many reasons why it’s beneficial to work with us as experienced buyers agents.

Cash Vs. Financing

You should know in advance whether you have the ability to make a cash offer or if you’re financing your home.  If you’re making a cash offer, you’re likely to have an upper hand in negotiations.  Cash transactions close faster because you don’t have to deal with banks or any of their requirements. If you’re competing against other offers that are contingent on financing, the seller might accept yours simply because the transaction will close more smoothly.

However, if you know you’re financing your home, there are some steps you can take to stay competitive with your offer.

Pre-Approval Letter

Getting pre-approved by your bank is very important in any situation and will help you in different ways.  First of all, it will help you understand how much you’re approved to borrow, which will dictate your budget and what houses you look at.  Secondly, by having a pre-approval letter from your lender and including this letter in your offer, sellers will know you are serious, motivated and that your offer is real.

Pre-Underwriting

Pre-Underwriting is when a lender puts a loan application through a more rigorous vetting process before the buyer even enters into contract.  This would typically be completed after choosing a house and having your offer accepted, but before a contract is in place.  Pre-Underwriting helps put a borrower in the same position as a cash buyer. To learn more about pre-underwriting and how it can help your offer, read our blog post Competing With Cash: Pre-Underwriting.

Contingencies

Most buyers make offers contingent upon financing and inspections, which is very reasonable.  However, if you’re up against other offers and are really serious about getting your offer accepted, you can waive these contingencies.  This would obviously expose you to greater financial risk.  However, in a hot market where listings receive multiple offers, sellers will often pick the highest offer with the fewest contingencies.  Here are some of the most common contingencies:

Financing Contingency

A financing contingency is a clause that states your offer is contingent upon securing financing. If you’re financing this transaction, you’ll obviously want to make sure the bank will lend you the money to do so.  Pre-approval, which we discussed earlier, is a general commitment to lend based on your creditworthiness. A financing contingency allows the buyer a certain amount of days to apply for a mortgage and secure a loan.  (Pre-Underwriting can help you ‘unofficially’ qualify for a loan before signing a contract, allowing you to waive this contingency with less risk.) Financing is also contingent upon the property appraising at a certain minimum value.  A seller’s listing price doesn’t determine the value of a house.  A professional appraisal does.  An appraisal protects a buyer from paying for more than a property is actually worth.  It’s also required by most lenders and insurance companies.

Inspection Contingency

An inspection contingency is a clause that states your offer is contingent upon a home inspection. While you and your real estate agent will walk through the house to make sure it’s in sound condition, there are things that are difficult to visually assess.  These include, for example, the property foundation, HVAC system, plumbing infrastructure and so on.  A professional home inspector will look at every inch of the property and let you know if anything is in disrepair or if any major improvements will need to be done within the next several years.

Earnest Money

One of the easiest, yet most powerful things you can do to show a seller you are serious is by leaving earnest money.  This is a basically a good faith deposit.  You’re telling the seller “I’m serious about buying this house that I am going to put my money where my mouth is!”  If the seller accepts your offer, this earnest money is held by a third party in escrow (title or real estate company) and eventually applied to your down payment/purchase.  If your offer does have contingencies that aren’t met, your contract can be terminated and the earnest money, in most cases, is returned back to you.

Closing Date

By taking many of the steps we’ve discussed, you can prepare yourself to move quickly through the home buying process.  Make a point to schedule the earliest possible closing date (unless the seller prefers something later) and specifically include this in your offer.  This will, again, show the seller you’re motivated.

If you’re looking to buy a home in Rochester, MN, please give us a call we can go through the home buying process more thoroughly and answer any questions you might have.

Selling your house is an involved process that requires time, dedication and a commitment to involving the right people.  Here are a few things you’ll want to consider before putting your home on the market.

Your Home's Real Value

The first step is determining how much your house is really worth.  We can help estimate your property’s value based on based on factors such as features, square footage, condition, location, as well as current and recent market conditions, to name a few. Many sellers tend to think their home is worth more than it actually is.  This is partly because they often have emotional connections to their homes and falsely attribute a dollar value for what is really sentimental value.

Closing Costs and Considerations

Understanding your home’s true value allows you to work out the economics and decide whether selling your house makes sense for you.  As a seller you’ll have some basic closing costs and the agent commission to cover.  More importantly, you’ll have to consider satisfying any mortgages, lines of credit and loans against the property. If you don’t have enough equity in the house to cover these costs, you might find yourself losing money on the transaction.  Every decision you make will be affected by how you understand your home’s value. Another major consideration is identifying the next step in your own personal life.  Are you renting vs buying a home?   Are you depending on proceeds from this transaction to help fund this next step?  If you are, you’ll need to account for this in your transaction and make sure the economics make sense. We can help you break down the costs and considerations during a sales transaction on both the buying and listing side.

The Real Estate Broker

Knowledge is the single most valuable resource to the entire sales process.  With twenty four years’ of experience, we have a strong understanding of the local real estate market, industry trends and all the players.  When you’re working with us, we bring insight and information that will help guide you through the market and make the best decisions to achieve your goals including:

• Defining the right listing price – Overpricing a house will turn buyers away.  If you come on the market at a price that’s too high and then lower it, the listing can lose creditability, become stale and sit on the market.  The most successful transactions are priced appropriately and sell quickly.
• Knowing how to negotiate – Negotiation is a delicate art.  As sellers, we have emotional connections to our property and often let that get in the way when negotiating with a buyer.  
• Effectively marketing the property – Statistically, properties listed by brokers sell more quickly and command higher offers.  According the National Association of Realtors, in 2012 broker listed homes sold for about $40,000 more than similar homes that were listed for-sale-by-owner.

Showing the House

Buyers often have difficulty envisioning the real potential of a property.  They can’t always visualize how they would use the space.  Preparing your home for sale will help your property stand out and emphasize its best qualities.  “Home staging is like dressing your house for success,” Patte Lau, Interior Stylist, says. “Just like you would prepare for a very important interview, first impressions of a house are a top priority.”  First impressions are everything.  Most buyers make an instinctual decision about buying a property within the first few minutes of arriving. A 2012 study by the Real Estate Staging Association® shows staged homes spent 73% less time on the market. “174 homeowners had their property on the market on average of 156 days before they decided to stage.  Those same homes were staged and sold in 42 days on average after staging.” We help you prepare your house to show well.  Staging properties can include everything from eliminating personal belongings, replacing furniture and even landscaping!  Depending on the condition of your house, and what kind of staging work needs to be done, there may costs involved with this.  You’ll want to keep the house in showable condition until the house is sold. Lastly, it’s important to maintain a consistent and convenient schedule for prospective buyers to visit the property. So here you have a glimpse of what you might expect when selling your house.  By doing your research and understanding the entire home selling process, you can eliminate any surprises and make this a pleasant experience.  If you have any questions about real estate in Rochester, MN, feel free to give us a call.  

Real estate agent for RE/MAX Results in Rochester MN — Lori Mickelson attained the highest volume of home sales for RE/MAX Results in Rochester MN in 2013. Mickelson’s exceptional customer service skills and extensive knowledge of the Rochester MN real estate market helped her to become RE/MAX Results #1 real estate in Rochester for closed volume. Mickelson’s dedication to providing excellent client services, as well as her extensive expertise in homes for sale in Rochester MN, has led her to become RE/MAX Results #1 real estate agent of the year.

Mickelson began her real estate career in 1990 after graduating from the University of Minnesota. Prior to that, she attended Rochester John Marshall High School. Her 24 years of experience in real estate in Rochester MN have given her a distinct advantage over much of her competition. She is highly skilled in negotiation and sold more than 130 homes in 2013, many above current market prices. In 2013, she grossed over $32 million in home sales. Since her career began, she has consistently been ranked in the top one percent in Rochester MN and in the top 10 for RE/MAX Results in Minnesota.

Customer referrals comprise 90% of Mickelson’s real estate business. Rather than passing on clients to teams of “training agents,” Mickelson strives to work directly with all of her clients—calling them as soon as new homes that fit their specifications enter the market. Her passionate dedication to quality service and her attention to detail are the backbone of her career.

“Lori Mickelson takes the time to find out about her clients and their needs and wants,” said Marci Billings, a former client of Mickelson’s. “She is incredibly knowledgeable about her work and always has a smile on her face! Lori doesn't just find you a house—she finds you your home!”

Mickelson’s industry focus in home sales has made her an expert in home staging. She knows what needs to be done in order to sell a home quickly and for higher prices, including how to make a home presentable from street view, small investments that can make a huge difference, and tips and tricks to keep in mind just before a showing. In fact, she gives her clients access to her own personal selection of interior decorations, for no cost, while the home is on the market. She is a “full service” realtor, with a number of affordable and trustworthy individuals on speed dial to assist her clients with any home projects or repairs they might need.

“Very, very satisfied is how I would describe the experience of selling my home with Lori Mickelson,” said Dennis Mays, one of Mickelson’s past clients. “The whole process was completely hassle free. Lori and her assistant took care of everything. Professional is how I would describe the approach of Lori and her team.”

Additional services Mickelson offers include access to Rochester MN MLS listings, expert paperwork and negotiation skills, and a detailed analysis regarding the real estate status and real estate needs of individuals.

RE/MAX Results is a full-service real estate company and has served the greater Rochester MN area since 1987. RE/MAX Results prides itself on providing top-quality agents and top-quality service for all of its clients’ real estate and marketing needs. Services that RE/MAX Results offers include the following: strategies for buying and selling homes, insights in the housing market, home valuation, relocation and moving services, financing home mortgages, and information regarding local school districts.

We’re always talking about how confident the Rochester real estate market is. In any market that enjoys healthy competition, buyers want to know how to compete with cash offers. Historically, there wasn’t much of a way to do that, but now, some lenders are offering pre-underwriting—a more thorough vetting process that goes beyond the typical credit check of pre-approval.

Pre-underwriting is simply moving the underwriting phase up in the home buying process. Instead of the underwriter thoroughly checking a potential buyer’s documentation after the offer, they do it before the contract is negotiated. Essentially, as the lender has already taken that extra step in ensuring the buyer’s creditworthiness, the buyer gets a badge of approval, one that is a notch above pre-approval.

Pre-underwriting Competing with Cash

To understand why pre-underwriting makes a buyer more competitive, we need to understand the attractiveness of the cash offer. With most cash offers, the lender’s role is greatly reduced, meaning many cash offers won’t be contingent upon:

• A property appraisal
• An inspection
• Insurance
• Financing, which can take more than a month to come through

On a cash deal, as the buyer is not beholden to a lender, they can negotiate the first three items on the list. As cash buyers don’t have to wait for financing to come through, cash offers tend to close quicker, which is very attractive to sellers—so attractive that many sellers will accept a lower cash offer over a higher offer that’s dependent on financing.

Enter pre-underwriting. Pre-underwriting, however, is not offered by all lenders. As Peter Grabel, a senior loan originator with Luxury Mortgage in Stamford Connecticut, explained to The New York Times, pre-underwriting takes considerable man hours, which is a lot of work to put into buying a house that’s not under contract. That’s why Luxury Mortgage reserves pre-underwriting for borrowers with “complicated finances.”

With Mayo Clinic’s new Destination Medical Center (DMC), we’ve seen the local market become very competitive, with homes receiving multiple offers and often selling above asking price. With growth on the horizon, buyers in Rochester will want to be as competitive as possible, especially as all-cash sales accounted for 35 percent of transactions in February 2014, according to The National Association of REALTORS®.

“Pre-underwriting is becoming more common in Minnesota,” said Minnesota REALTORS® CEO, Christopher Galler. “Sellers are leery about pre-approved buyers. The added assurance of pre-underwriting is better for the buyer as well.”

Though not every lender offers pre-underwriting and not every buyer will qualify for pre-underwriting, it’s certainly an option to explore that can give you an edge in a competitive market.

To sum it up, the market is moving at full speed. Lately, we have been seeing rising interest rates and so have our buyers. Inventory has been relatively low and the new listings coming on the market that are appropriately priced aren’t lasting long. Many of our listings have sold with multiple offers, and at over the asking price. It remains a good time to sell a home, as competition is low and buyers are waiting for listings to hit the market. We have seen homes in the $150K-$210K price range selling particularly fast. Historically speaking, things start to slow down a little more into August as we head into the cooler months and less buyers desire a fall moving season.

Throughout the last several months, the big topic of discussion has been the DMC (or Destination Medical Center) proposed by Mayo Clinic. The DMC would provide thousands of jobs for the Rochester area and increase tax revenue for not only Rochester, but the entire state of Minnesota. We’ve stood by and watched hopefully, waiting to see whether or not this proposition would materialize into something solid.

We are excited to announce the passage of the Destination Medical Center bill and cannot wait to see the changes that the city of Rochester will go through in the upcoming years. This bill will bring not only incredible job growth within the medical sector but also more opportunities for private investors seeking to expand into Rochester’s entertainment industry, be it restaurants, theaters, shopping, and other options for consumers who are either visiting or living in Rochester.

We have always been confident in Rochester’s real estate market because of the economic stability of our city, but we are now more excited than ever for the growth that is set to occur. In the past several months, we have seen so many of our listings sell with multiple offers at either the asking price or above. Unfortunately, this has resulted in unrepresented buyers “losing” out on the homes that they want to purchase, and we must stress that now, more than ever, is the time to be working with a knowledgeable real estate agent in the sale or purchase or property. We often receive emails that come in from various websites from these unrepresented buyers, sometimes even just a day after a home went on the market, and have to reply, “Sorry, it’s already sold.” Demand is high and buyers and sellers should have an agent by their side, committed and ready to move quickly. We work 24/7 to make sure that our clients are getting the best customer service in a market that is already moving at a fast pace. With the DMC passage, we expect to see incredible growth in real estate and couldn’t be more excited to help the residents of Rochester take advantage of opportunities during this time!