Six Tips for Choosing the Best Offer for Your Home

By: G. M. Filisko

Published: February 10, 2010

Have a plan for reviewing purchase offers so you don't let the best slip through your fingers.

1. Understand the process

All offers are negotiable, as your agent will tell you. When you receive an offer, you can accept it, reject it, or respond by asking that terms be modified, which is called making a counteroffer.

2. Set baselines

Decide in advance what terms are most important to you. For instance, if price is most important, you may need to be flexible on your closing date. Or if you want certainty that the transaction won’t fall apart because the buyer can’t get a mortgage, require a prequalified or cash buyer.

3. Create an offer review process

If you think your home will receive multiple offers, work with your agent to establish a time frame during which buyers must submit offers. That gives your agent time to market your home to as many potential buyers as possible, and you time to review all the offers you receive.

4. Don’t take offers personally

Selling your home can be emotional. But it’s simply a business transaction, and you should treat it that way. If your agent tells you a buyer complained that your kitchen is horribly outdated, justifying a lowball offer, don’t be offended. Consider it a sign the buyer is interested and understand that those comments are a negotiating tactic. Negotiate in kind.

5. Review every term

Carefully evaluate all the terms of each offer. Price is important, but so are other terms. Is the buyer asking for property or fixtures—such as appliances, furniture, or window treatments—to be included in the sale that you plan to take with you?

Is the amount of earnest money the buyer proposes to deposit toward the downpayment sufficient? The lower the earnest money, the less painful it will be for the buyer to forfeit those funds by walking away from the purchase if problems arise.

Have the buyers attached a prequalification or pre-approval letter, which means they’ve already been approved for financing? Or does the offer include a financing or other contingency? If so, the buyers can walk away from the deal if they can't get a mortgage, and they'll take their earnest money back, too. Are you comfortable with that uncertainty?

Is the buyer asking you to make concessions, like covering some closing costs? Are you willing, and can you afford to do that? Does the buyer’s proposed closing date mesh with your timeline?

With each factor, ask yourself: Is this a deal breaker, or can I compromise to achieve my ultimate goal of closing the sale?

6. Be creative

If you’ve received an unacceptable offer through your agent, ask questions to determine what’s most important to the buyer and see if you can meet that need. You may learn the buyer has to move quickly. That may allow you to stand firm on price but offer to close quickly. The key to successfully negotiating the sale is to remain flexible.
G.M. Filisko is an attorney and award-winning writer who has survived several closings. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

Minnesota Market Trending Towards Higher End Homes in 2011

If you are one of the lucky few to own a Frank Lloyd Wright built home, then you will never have to worry about the twists and turns of the housing market.  Wright is considered America’s best architect and the homes he built are highly coveted; to own a Frank Lloyd Wright home is to own a piece of our national treasure and you should never sell it!  If, however, you are in the 99.9% of Americans, who do not own a Wright home, then you need to be concerned with the highs and lows of the market: here are a couple market trends to look for in 2011.

#1 – In 2011, It Will Be Harder To Sell Homes Priced At 190k Or Less In The Twin Cities *

Why?  Because the inventory of homes in this price range has increased by 46% from the previous year.  In addition, the months supply of 2011 inventory for 190k or less has increased 73% from 3.9 in 2010 to 6.77.  The months supply calculates how many buyers there are compared to sellers in the market… a calculation of 6.77 determines a market flooded with sellers; thus making it harder to sell a home.  Beyond the numbers… the popular tax credit for first time home buyers expired in the latter part of 2010 and is one reason why the market will have fewer buyers in 2011.  In addition, bank owned homes continue to saturate this price range.  If you have a home in this price range listed in 2011; get your home to stand out by creating a clear and aggressive marketing strategy and be sure to price it right. Finally, choosing the right realtor is key to selling your home in a tough market.

#2 – Your Million Dollar Minnesota Home Will Sell in 2011!*  

There is no certainty in the housing market, but the inventory for homes priced at million dollars and above has decreased 15% over the past year; making the competition more reasonable than last year.  Another positive trend… The month supply data for million dollar homes has decreased more than 26% from a year ago.  The month supply data is calculated to determine the state of the market; a decreasing number means the increase of buyers and/or decrease in sellers.  A smaller inventory of homes and a larger pool of buyers is a recipe for success in 2011.

*Data used for this article was published by the St. Paul Area Association of Realtors (SPAAR).  Search: Housing Supply Outlook

Follow my blog, Minnesota Real Estate by Matthew Underwood, for more information on the housing market.  Other valuable websites: www.twincityrealty.com; www.spaar.com; www.realtor.org.

Building the Future of the Shakopee Mdewakanton Dakota Community

One of the most important priorities of the Shakopee Mdewakanton Dakota Community (SMSC) is to express itself as a sovereign government, independent from the surrounding communities.  Native Americans throughout the United States have been fighting for this distinction since Europeans started inhabiting North America.  For past several years, the SMSC has made many strides in doing this, largely because of the wealth obtained through Indian gaming.  The wealth has enabled the community to provide public services to its members and aided the tribe in building a community less dependent on the neighboring cities, the state of Minnesota and the federal government.  Though the tribe has made many strides in developing an independent community, there are many more steps to be taken in order to succeed in the endeavor of an independent, sovereign government.  The SMSC has an opportunity to be a leader of the Native American societies by building a community through government, educational, business and philanthropic institutions.  If done correctly, the SMSC will be at the center of the renaissance for Native American societies in the twenty-first century.

In order to better establish the reservation as an independent community, the SMSC will need to continue building public institutions and the best building to start with is a government hall. People are visual and the construction of public institutions is an effective measure in creating independence.  Currently the SMSC has a very active government, where nearly every eligible member votes regularly and attends community meetings; however, there isn’t a distinct location where outsiders can envision this happening.  The outcome of building a government hall with great architecture will enhance, empower, motivate and bring clarity to the SMSC members by creating a space where it shows the importance of what is being accomplished by the SMSC.  A government hall is essential to the renaissance of Native Americans and to further establish a sovereign government for the present and future.

In addition to building a government hall, the SMSC will greatly benefit from building schools on the reservation and creating a curriculum based on the Native American perspective.  A curriculum based on Native American history, language, arts, sciences and traditions is essential to preserving Native American culture.  It will provide an alternative to the traditional European based education system provided by the public school system in the United States.  The creation of a university system is another strategic move in centering the renaissance on this reservation.  Education is the best way to preserve and empower the traditions of the Native American people.  An education system is another vital aspect to the success of strengthening independence on the reservation.  

Indian gaming has been key to generating wealth on the reservation and the SMSC is using the wealth to build public institutions and provide services to the members of the community.  The revenue generated through business has been used wisely in creating a more sovereign government.  Continuing to build up the business community will help in developing a healthy and vibrant community.  It is the business community that allows for the other parts of the community to flourish and the SMSC will be wise to attract more business to the reservation; including, retail, dining and entertainment that supports gaming.  In addition, the SMSC should look for businesses that are independent from gaming as it will provide a more balanced economy on the reservation.  The revenue created through business is used to build the institutions that preserve Native American culture and strengthen sovereignty on the reservation.

Philanthropy is a strong part of the SMSC community and with the success of Indian gaming the tribe has given millions of dollars to many charitable organizations.  The SMSC will continue to do this and should focus their philanthropy on building institutions on the reservation.  The reservation will be served well with the construction of museums and libraries that cultivate Native American art and history.  Museums and libraries are institutions that add culture to the community and provide education to outsiders unaware of Native American culture.  Most importantly, it is often from these institutions that you cultivate the strongest members of the community, who preserve the traditions and protect the sovereignty of the reservation.

Picture the SMSC with a government hall, an elementary school, a middle school, a high school, a university, a business district, an industrial district, a museum, a library and more.  It will look dramatically different from today and even more different from 1969.  These are buildings that will cement the sovereignty of the community and create a renaissance on the reservation that will be contagious to other tribes throughout the country.  To preserve Native American culture into the twenty-first century and beyond, the SMSC will need to continue building the institutions that will support Native American culture, tradition and sovereignty. 

Building a Home in the Winter

Are you ready to start building your new home?  When choosing a time frame to build a new home, many people think they have to start in the spring or summer and try to avoid building in the winter.  That may have been correct in the past, but is wrong for today.  The winter has many attractive reasons for you to start building your new home.  Here are some of the top reasons why you should start building now and not wait until the spring to build your new home.

1) You Are Ready --  Building a home is a wonderful experience and it takes time to complete.  The sooner you get started the sooner you will be living in your new home.

2) You Have Time -- In Minnesota, there are only few months out of the year when we get to enjoy outdoor activities; such as, hanging out at the lake, going to the cabin, picnicking with family and friends, etc.   Building a home takes your commitment and time and building in the summer takes away from those activities.   It’s better building during the winter, when you are stuck inside.  Most of your time and commitment to building a home will be done in the warmth of your home or in the builder’s office.  

3) It's Less Busy --  Supply and demand rules the market.  As demand drops in winter so does the work for the builders and contractors.  Builders are able to be more attentive in the winter to their clients as there are fewer projects on going.  As a general rule of thumb, the more attention given to the project makes for fewer problems on the project.

4) Technology -- In the past, builders ran into complications when trying to build in the winter.  Today, there is very little difference between what month you build in because technology has made it easier and cheaper to build in the winter.

5) Winter Concrete --   One of the biggest problems of the past was laying the foundation in winter, but now there are special additives in the concrete that make it possible to lay foundation in any month.

These are a few of the pros of building a home in the winter.  There are many more reasons to do so and there can always be some negatives of building in the winter.  It’s always best to consult with your home builder.  The experts can help you make the best decision and help you accomplish your goal of building your new home.

Choosing a Realtor to Represent You

   In the world of real estate, a transaction can go bad quickly and one of the best ways to be protected against it is by choosing the right realtor.  This article will help you be successful in real estate by defining the core values of the best realtors.  When you are ready to buy or sell real estate, choosing a realtor is one of the first and most important steps and in our world of mass media there are many ways to find an agent; however, the best way to find a realtor is by asking your family and friends to recommend someone.  Once you’ve narrowed down your choices it is best to do some research on the person or persons.  Go to their website and look for specific points of emphasis as their priorities. Also, the Department of Commerce (DOC) is another valuable resource, as the DOC is where a past client would file a complaint against a realtor.  If an agent has engaged in unethical or fraudulent behavior and it has been reported, it will be on file at the DOC.  Access the DOC online at www.commerce.state.mn.us. 

   The most important quality a good realtor has is honesty; as there are too many agents in this business willing to be dishonest and say anything to a potential client to secure business.  The process of a real estate transaction is complex and takes a significant amount of time and effort; if you end up working with a dishonest realtor, there is a good chance the transaction will get ugly.  There is also a very good chance you will end up working with other dishonest people involved in the transaction, because people with poor values tend to work together.  When researching the realtor’s website and advertising; look for words like honesty/trust/integrity to be emphasized on their website and in their advertising.  Often times, those who are dishonest will avoid those words, because they do not prioritize them.  In other words, be aware of what is being omitted in a website or advertisement.  Avoid getting yourself caught up in legal issues by working with a realtor, who is honest.

   Hiring a hardworking and passionate realtor is vital to having your real estate transaction be pleasurable and successful.  When you find yourself having to engage in real estate, whether it be for your home, business or as an investment; it is one of the most considerable transactions you will do in your lifetime and the process is significant, both in time and importance.  The amount of work and knowledge an agent needs to obtain in order to serve his or her client well is staggering and too often realtors become overwhelmed by the workload, thus they begin to cut corners and it affects their ability to provide quality representation. Often times, a realtor will represent clients looking for real estate in multiple areas; including different neighborhoods, cities and counties and he/she needs to stay informed on the many statutes, ordinances and laws which govern those areas.  In addition, the inventory of homes and businesses is large and constantly changing; many agents are not aware of what is available in the areas they represent, which can be the difference between a good or bad deal; or even an extraordinary deal.  Beyond the laws and inventory, there are a multitude of items in which a realtor needs to be knowledgeable; such as financing, marketing and negotiating transactions. Simply stated, it takes a lot of work to provide quality service. Knowing the workload is immense, partnering with a passionate agent will provide an energy to the process and enliven the experience for all participants.  As well as loving his/her work, a positively, passionate realtor will keep you motivated throughout the process.  The best way to find a hardworking and passionate realtor is by referrals, researching their work (website, blog, advertisement, etc.) and interviewing potential realtors. 

   If you’ve narrowed it down to a few people and they are all honest, hardworking and passionate realtors.  Here are a few more qualities to look for as you make a decision on an agent.  A realtor, who is articulate and a good listener is essential.  Working a creative person helps you troubleshoot through the issues, which are likely to come up during the transaction. And finally, choosing an intelligent agent will make the process easier on you.  He/She will be able to advise you on the many options you will have as you engage in buying or selling real estate.  There you have it…  An honest, hardworking, passionate, creative, intelligent, well spoken and a good listener is the realtor you want representing you in the world of real estate.