The Difference Between a “Fixer-Upper” and a “Money-Pit”

How to Know When It’s Worth it to Buy a Fixer-Upper

How to know if a home is a fixer-upper.We’ve all watched those flipping shows, where a burly guy and his beautiful designer spouse buy a dump and turn it into the perfect home. They sell it fast and make a ton of cash. That’s just a TV show, right? Obviously flipping houses does occur, just usually not to that level of success. And yet a lot of people shopping for real estate are looking for a solid home at a decent price that they can put their own sweat and tears into, and add to the value of the property in the process. How do you avoid getting burned financially by buying the wrong house? There is a difference between a fixer-upper and a money-pit. Read on.

A Fixer-Upper is generally a home that’s in a decent location, structurally sound, but needs general maintenance, a lot of cosmetic changes and design improvements. The homeowner can usually reside in the home while the work is being done…so it’s not THAT bad of a place. Many times the projects can be DIY, too. The projects often include:

  • Walls – fill holes, repair damaged areas, remove and update wallpaper and paint. The exterior may need some repair and painting as well.
  • Floors – refinish hardwood floors, clean or replace carpet and upgrade other flooring materials.
  • Lighting – update fixtures throughout the interior and exterior of the home.
  • Wood – replace damaged trim, repair doors and cabinets.
  • Kitchen and bathroom – new hardware, painting or refinishing cupboards if necessary.

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2013 Minnesota Housing Year in Review

Prices appreciated and reduced selling time highlight 2013

All key indicators are showing that there is confidence in Minnesota’s economy, which is translating to a positive trend in housing, according to the yearend housing report from the Minnesota Association of REALTORS®.

With the continued addition of employment opportunities coupled with low mortgage rates and a tight rental market, many people made the homeownership choice in 2013.  With prices on the rise and inventory low, those homeowners who found themselves underwater a few years ago, can now consider making a move.

Noteworthy highlights:

Minnesota Housing report
2013 MN Housing Review
  • There were 77,820 residential properties sold in 2013, which is a 4.6% increase over 2012.
  • The average sales price went over the $200,000 threshold statewide.  This is the highest average sales price Minnesota has seen in the last five years.  An increase of 11.2% to $209,079 was the average.
  • The median sales price, which is the midway point of all houses sold, also showed a 13.0% increase over last year.  A rise in the median price can indicate that sellers are responding to local market activity and feel confident asking more for their home. 2013 ended up with a median price of $170,000, again a five year high.
  • A decrease of 17.7 percent for days on market is a number that homeowners like to see.  At 79 days for 2013, this is a 5 year low we like to see.
  • Sellers found that they were selling their homes faster and for more money. Homes on the market received 94.6% of the original list price which is a 2.3% increase over 2012.

The Minnesota Association of REALTORS® is the largest professional trade association in the state with more than 17,000 members who are active in all aspects of the real estate industry.

November Housing Report

Housing Inventory Down in November; Sales Prices on the Rise November Minnesota Housing Report

While potential homebuyers had fewer choices in November, sellers saw increases in both the average and median sales prices which is contributing to Minnesota’s market recovery.

New listings statewide were down 9.1 percent or 566 units over November 2012.  However, there are still over 31,000 homes for sale throughout the state – a 2.9% increase over last year’s listings.Read More »

October in Minnesota Still Shows Activity in the Housing Market

Median sales price is good indicator of confidence

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November 20, 2013 (Edina) – Homeownership in Minnesota continues to make strides according to the latest report from the Minnesota Association of REALTORS®.  Homeowners who were holding back from selling their homes until values inched back up or until they were no longer under water on their mortgages are starting to get back into the market.  In October there was an 11.5% increase in new listings over the same time last year statewide. Median sales prices have also continued to increase from $156,000 to $175,000.Read More »

MNAR Housing Report, Market on the Rise

Homes Selling Faster, Median Sales Price on the Rise REALTOR

September 20, 2013 (Edina) – The story seems to be the same, if you were a home seller in Minnesota, the summer of 2013 was a good year!  According to the Minnesota Association of REALTORS® latest housing report, the statistics show it – houses are selling faster and the median sales price continues to increase.

During August, statewide numbers showed a 21.1 percent decrease over the same time last year.  Houses that were selling in 90 days last August sold in 71 days this August.  Not only did home sellers find a quicker sale of their homes they also received more money.  The median sales price in the state jumped 14.3 percent over the same time period from 2013.

The median house price is the midway point of all houses/units sold at market price (or sold amount) over a set period.

Median Sales Price

  • Northwest Region                               24.4%
  • Headwaters Region                            14.1%
  • Arrowhead Region                              17.6%
  •  West Central Region                          10.8%
  • North Central Region                          -8.8%
  • Southwest Central Region                  2.7%
  • Upper Minnesota Valley Region       9.9%
  • East Central Region                             22.2%
  • Central Region                                      13.3%
  • Southwest Region                                 0.1%
  • South Central Region                         10.2%
  • Southeast Region                                  4.8%
  • 7-County Twin Cities Region           18.1%

“The Minnesota market has made some nice gains over the summer months”, said Jim Cormier, President of the Minnesota Association of REALTORS®.  “Not only are homes selling faster and at a higher median price, but there are more homes on the market to choose from as well.”

The current report shows that statewide new listings increased by 12.5 percent over the same time last year.  While inventory in certain price ranges still remains low, the increase overall is a good sign.

“Homeowners are gaining confidence in the market and the report shows it”, said Chris Galler, CEO of the Minnesota Association of REALTORS®.   “Sellers are putting their homes up for sale and are finding that the market is in their favor.”

Galler pointed out that as we enter autumn real estate activity slows.  Things that contribute to a slower activity include children in school, moving during snow season and the Halloween through New Year’s holiday season.  He added that so long as the economy continues to improve and interest rates stay low, housing activity will remain above last year’s level.

The Minnesota Association of REALTORS® is the largest professional trade association in the state with more than 17,000 members who are active in all aspects of the real estate industry.

 

The Housing Market Heats Up as Temperatures Rise This Summer

Homes are selling at fastest rate since 2005.

Shorts, flip-flops and tan lines aren’t the only things trending this summer. The housing market has been heating up since July. Homes are flying off the market, according the latest report from the Minnesota Association of REALTORS®.  Homes statewide are selling in 70 days or less. If you’re in the Twin Cities, houses are selling even faster on average in 46 days. This is the fastest homes have sold since 2005.

Minnesota Housing Report

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