May 24, 2022

A Realtor's Guide to Primary Residences vs Second Homes

Have you been thinking about buying a second home or investment property?

The realtors at The HIVE have experience helping people buy primary residences, second homes, and investment properties. We put together this quick read to help you learn about your next potential real estate purchase. Read our blog for more information about second homes and investment properties.

If you have additional questions, or are reading to find your perfect second home, contact us today.

1. Primary Residence vs. Second Home

What is the difference between a primary residence and a second home? Buying a second home is very similar to buying a primary residence, although there a few key aspects to consider:

  • A second home is defined as a residential property that the owner did not purchase for use as an investment property. The owner resides in the home for at least part of the year but does not use as the primary residence. 
  • Many lenders require buyers to put down a minimum downpayment of 10% (compared to a potential 3% downpayment for a conventional loan on a primary residence).
  • Buyers will likely pay a slightly higher interest rate for second homes than primary residences.

Buying a second home is slightly more complicated than buying your primary residence . If you are looking to get a mortgage for your second home, you will likely need a larger down payment and have to pay a higher interest rate. It’s important to discuss with a lender before touring homes to verify what types of homes will be a good financial fit for you, your family, and your goals.

2. Second Home vs. Investment Property

Sometimes the terms "second home" and "investment property" are used interchangeably, however there are a few distinct differences.

  • An investment property is purchased for the primary purpose of generating income, while a second home is not. 
  • Second home loans are typically easier to qualify for than investment properties.
  • Second home loans typically receive lower interest rates than investment properties.
  • Investment Properties are able to depreciate even while they're appreciating in value:
    • Appreciation is when the value of the property increases over time.
    • Depreciation allows investors to recoup some of the costs of managing an investment property by claiming a tax deduction. Tax depreciation is a theoretical loss in value over time as a result of typical wear and tear. 
    • Taxes are difficult, so always consult a tax professional.

3. Renting Out Your Second Home

While owning a rental property can take a large initial investment, each time your property is rented out, you earn income that you may use to improve your property or help pay the mortgage. If you’re only planning to occupy your second home for a couple of weekends each month, it may be a great idea to set it up to rent out a week or two. Visit our investment property blog to learn more about the benefits. 

For tax purposes, a property is a second home if the owner lives in it for at least 14 days each year or 10% of the number of days it is rented out.

Typically, if the second home is rented out for less than two weeks per year, the owner can keep the rental income without paying taxes on it.

4. Why are People Buying Second Homes?

According to the National Alliance of Home Builders, the U.S. has a stock of 7.5 millions second homes as of 2018, reports predict that this number increased dramatically in the last two years due to the increase in availability (and sometimes necessity!) to work from home. Reason people are buying second homes include but are not limited to:

  • Looking for a getaway from the city
  • Looking for a place for the future
  • Vacation Retreat
  • Family Retreat
  • Investment Property
  • Retirement
  • Being closer to friends and family

5. Things to Consider When Owning Two Homes

While it may seem pretty straight forward, it's important to consider the costs associated with owning two homes. Once you've purchased a second home, you'll be responsible for the following on both homes:

  • Property taxes
  • Insurance
  • Furniture
  • Utilities
  • Possible HOA fees
  • Security
  • Maintenance

6. Kiddie Condo Loans

The name is slightly misleading, because "Kiddie Condo Loans" can actually apply to several types of residential real estate. So what do we mean when we say "Kiddie Condo Loan"??

A kiddie condo loan is an easier way for parents to purchase investment property, rent to their children or family members at market rate, and build equity. 

  • These types of investment loans are administered by the Federal Housing Administration - Both the parents and the child or family member who will live in the home are on the loan.
  • It's a great way for parents to help their children get into their first home.
  • It's an alternative to renting an apartment or dorm in college
  • It's an alternative to renting for seniors who need to be closer to family for help as they age. 
  • Easier qualifying standards than a typical investment property. 

 

Let us know if you have any questions about buying a second home.

One of our experienced realtors will be in touch as soon as possible. 

We can start the process today!

 

May 16, 2022

Twin Cities Residential Real Estate Investing

Curious to learn more about investing in residential real estate? Read our blog about Twin Cities residential real estate investment to learn about some pros and cons, commercial versus residential real estate investing, and residential real estate investment strategies.

Let us know if you have any more questions, one of our Twin Cities realtors will be in touch as soon as possible!

 

1. Single-Family Investment Property

When purchasing a single-family home as an investment property, most investors will simply break even the first few months to a year of ownership. After the first year or so, tax breaks and rental increases may result in earning a profit within a few years.

A huge benefit to investing in a single-family home is that you can use the profit from that investment to finance your next purchase. A con of investing in a single-family property is there is no economy of scale. For example, if you fix a roof on a four-plex, you have reroofed four units, which is 25% per unit. If you fix a roof on a single-family, your cost is 100% per unit.

If you're a handy person, sweat equity can pay off. By buying a fixer-upper, you can make well-planned and thoughtful updates that can increase the value of the property. Depending on local regulations, you may be able to rent the units at a higher price.

2. Multi-Family Investment Property

There are many benefits to investing in a multi-family property in the Twin Cities. Read our blog about the Top 4 Benefits of Buying an Investment Property. If the property is earning rental income when you purchase it, the debt-to-income ratio will be reduced, allowing you to purchase a bigger investment that if the property is vacant at the time.

With multi-family properties, the expenses remain flat while rental income has the potential to increase year after year. For example, you purchase your first duplex as an owner-occupant. At first, the property needs a little bit of elbow grease. You move in, and start updating the units bit by bit. Your first year of rental income is about $1,500 per month. As the years progress, you continue updating the units with things like new tile, new countertops, new stainless appliances, and many other beautiful touches. In a few years, that same duplex can be generating $1,635 per month, while your mortgage and maintenance costs remain the same as when you first bought it. That extra income each month can be used to finance your next home purchase or larger investment property. 

3. Commercial Residential Investment Property

Commercial residential properties are described as any residential property with five or more units. Commercial residential properties typically have more stringent financing requirements-- investors may be required to put as much as 50% down or more, depending on the current rental income of the property. One thing to consider before investing in a commercial residential investment property is that these types of properties may not be owner-occupied, therefore, they have different tax benefits than a regular multi-family property.

Currently in the Twin Cities, available housing inventory continues to remain low and prices continue to rise. When there is a high demand amongst would-be buyers, they turn to the rental market, making it easier to profit from owning a multi-family property, and less likely to deal with lengthy vacancies in your building.

4. Condominiums as Investment Property 

While ownership held in a condo is similar to other residential properties, ownership rights and how the property is managed is different.

  • The space inside the condo unit belongs to the owner, as well as a share of the common spaces such as elevators, hallways, etc.
  • Depending on the associations rules, you may have the opportunity to sublet the condominium.
  • Some lenders view condos as a slightly higher risk, so they might require a higher down payment.
  • There may be occupancy restrictions involved with a condominium. Many associations set a percentage limit of how many units can be part of the short-term rental pool. 

In some cases, a single-family detached home may be part of a condominium format.

  • Some neighborhoods condominiumize their area and share amenities such as community centers, hiking trails, and other fun activities for all of the condo owners to enjoy.

No matter which type of condominium you intend to purchase, we always recommend reading the bylaws before entering into a contract. Many real estate contracts allow buyers a ten day right of rescission period to review all the necessary documents before moving forward with the purchase. It's also extremely important to read through the board meeting minutes to get an idea of how the association is run and the financials to determine if there is sufficient money in the reserves to pay for the imminent expenses of the common areas.

5. Tax Benefits of Investment Property

Historic home renovations can lead to more tax credits. Changing a well-built historic mansion into several apartments with architectural charm, you may be able to take a tax credit up to 20% of the cost of renovations.

  • The home needs to be listed on the National Register of Historic Places, or located in a historic district.
      • With this type of investment, there are more guidelines to follow and rules about what can or cannot be changed due to local historical regulations.

    Low-income housing opportunities may also lead to tax credits, making it a desirable investment. When you invest in a historic home or a low-income housing opportunity you may be able to get a tax credit, which is typically more beneficial than a tax deduction. 

        • A $100 tax deduction in a 33% tax bracket might save $33 in taxes.
        • A $100 tax credit in a 33% tax bracket saves $100 in taxes.
          • Example: An investor has a $20,000 tax credit for building a low-income apartment building. The investor owes $45,000 in taxes for that year, but after applying the credit, their taxes are reduced to $25,000.

    Depending on the type of property you choose to invest in, you may also be able to write off the following expenses as tax deductions:

          • Mortgage Interest
          • Property Tax
          • Operating Expenses
          • Depreciation
          • Repairs
          • Insurance
          • Maintenance

    For more information, reach out to a licensed tax professional to learn about the different tax benefits for rental real estate property owners. 

    6. Fair Housing is for Everyone

    Remember, fair housing is for everyone. When investing in any type of rental property you must adhere to federal and state fair housing laws. The federal laws prohibit discrimination against the following classes:

        • Race
        • Color
        • National Origin
        • Religion
        • Sex
        • Familial Status
        • Disability

    In Minnesota, the following classes are protected in addition to the federal housing laws:

        • Marital Status
        • Creed
        • Public Assistance
        • Gender Identity

    Email us any questions you have about investing in residential real estate in Minneapolis, Saint Paul, or any of the surrounding communities.

    One of our Twin Cities realtors will be in touch as soon as possible.

     

     

May 9, 2022

Volunteers Needed! Dresser Build for Bridging | Furnishing Homes with Hope

 

REALTORS® Charitable Foundation at the Saint Paul Area Association of Realtors

1. What is Bridging?

Bridging is a local nonprofit that has recently been awarded a donation of $100,000 from the Realtors Charitable Foundation at the Saint Paul Area Association of Realtors (SPAAR). Bridging is the perfect beneficiary for such an award, and their goals go hand in hand with what SPAAR Realtors work to achieve every day--better communities.

Bridging's website says it best, "Bridging, a 501(c)(3) nonprofit organization primarily serving the Twin Cities, provides donated furniture and household goods to families and individuals transitioning out of homelessness and poverty. Bridging gives hope and a leap towards housing stability. With locations in Roseville and Bloomington, Bridging is driven by volunteers and donations of basic home essential items from the community." 

Watch this touching video, Building a Legacy of Hope, to learn more about the history of Bridging from the founder, Fran Heitzman. 

 

2. What is the Dresser Build Volunteer Event?

The Realtors Charitable Foundation has organized a stellar event with the goal of building 800 dressers in three days! Realtors, friends, family, and community members from far and wide will come together in May of 2022 to work towards this ambitious goal. There is no experience necessary to participate in this fun event! Since Minnesota spring weather is not to be trusted,  SPAAR is providing a large tent in case of rain, so be prepared for any type of weather!

A delicious barbecue lunch of hotdogs, chips and cookies will be provided for volunteers starting half an hour before the volunteer shifts, so bring your friends and don't miss this wonderful opportunity for a great time!

Help us all make the Twin Cities a welcoming community for all!

 

3. When and Where is the Dresser Build Volunteer Event?

May 23, 2022 at 1:30 - 4:30

May 25, 2022 at 1:30 - 4:30

May 26, 2022 at 11:00 - 2:30

LOCATION:

SPAAR - Saint Paul Area Association of Realtors

325 Roselawn Avenue E, Saint Paul, MN 55117

Free lunch included! All are welcome!

Builders must be 14 years of age or older.

4. Sign Up!

This volunteer event is open to everyone over the age of 14! The Realtors Charitable Foundation is looking for over 200 volunteers, so please spread the word! Sign up for a shift on the Realtors Charitable Foundation website. The HIVE Real Estate Team will be building dressers on May 26th at 11:00, we hope to see you there!

 

Posted in Community News
May 5, 2022

Can I Buy a Duplex with an FHA Loan?

As Twin Cities realtors, we're often asked, "Can I buy a duplex with an FHA loan?". The answer is yes! In fact, Megan just bought her home with an FHA loan in Saint Paul, Minnesota. Read our blog to learn more about the process of buying a duplex with an FHA loan.

Let us know if you have any more questions, one of our Twin Cities realtors will be in touch as soon as possible!

 

1. What is an FHA Loan?

FHA loans are insured by the Federal Housing Administration through the U.S. Department of Housing and Urban Development (HUD). The administration insures your loan, so that your loan officer can get you a better deal and help people of all walks of life become homeowners. These types of loans often offer low down payments (as little as 3.5%) and have easier credit qualifications than a typical conventional loan.

2. Buying a Duplex with an FHA Loan 

Buying a duplex with an FHA loan is very similar to buying a regular, single-family home. There are a few extra hurdles, but it can be well worth it! The process starts with getting pre-approved with a lender you trust. We always recommend interviewing 2-3 lenders to find someone who is going to work hard and secure the best interest rate. Make sure the loan officer you intend to work with has the ability to process FHA loans.

A common misconception among buyers is that you need to put 20% cash down in order to purchase a house. In reality, you can put anywhere from 3 percent to 20+ percent depending on your finances. Since the FHA program allows a down payment as little as 3.5%, many first-time homeowners can take advantage of the opportunity to start building equity! 

One thing to consider is that when you purchase a home with a down payment of less than 20 percent, you will be required to pay Private Mortgage Insurance (PMI) until you've put 20% equity into the property. Typically in the Twin Cities, PMI adds around $200-$300 per month onto your mortgage payment depending on the house you are buying and the amount of the mortgage. 

In addition to paying Private Mortgage Insurance, buyers with an FHA loan are required to live in the property for at least one year. 

3. FHA Home Appraisal

In addition to paying Private Mortgage Insurance, buyers looking to purchase a duplex with an FHA loan will require an FHA appraisal. An FHA home appraisal is very similar to an appraisal for a conventional loan and determines an estimate of the market value of the property. The U.S. Department of Housing and Urban Development has a roster of qualified, FHA approved appraisers, that your loan officer will hire as an unbiased third-party to estimate the market value and ensure the property is in good condition. In the event the appraiser finds hazardous items requiring repair, such as peeling paint or loose electrical wires, the sellers will need to mitigate those issues prior to closing.

4. Rental Income 

The real beauty of buying a duplex is the rental income you will earn each month to help pay your mortgage. Whether you're hosting long-term tenants or vacation getaways on Airbnb, your property will generate income, and in turn help you build equity and pay off your mortgage faster. A duplex that is already leased out can also help your loan officer qualify you for a higher loan amount. They will use 75% of the income generated from the current lease when calculating your pre-approval. 

  • Owner-occupied rental property: Live in one unit and rent out the other!
  • Vacation Rental: Renting your property for short term vacation getaways can have high income earning potential. 
  • Long-term Tenants: Having tenants on an annual lease ensures you get rental income each month and there is less variability compared to short term rentals.

5. Tax Benefits

  • You may be able to deduct the following expenses from your tax return:
    • Mortgage Interest
    • Property Tax
    • Operating Expenses
    • Depreciation
    • Repairs
    • Insurance
    • Maintenance
  • For more information, reach out to a licensed tax professional to learn about the different tax benefits for rental real estate property owners. 

6. Housing Flexibility

Owning rental property can open the door to housing flexibility in the future. Perhaps your job gives you the option to work remotely. After living in your duplex for one year, you could rent out your unit while traveling the world. In the meantime, your home is generating rental income to help pay off your mortgage--and maybe your vacations! The rental income earned on in your duplex could also help fund your next property!  

 

Email us any questions you have about buying a duplex with an FHA loan in Minneapolis, Saint Paul, or any of the surrounding communities.

One of our Twin Cities realtors will be in touch as soon as possible.

 

 

Posted in Buying a Home
April 26, 2022

Downsizing From a House to a Condo

Have you been thinking about downsizing from a house to a condo? People all over the Twin Cities area are getting ready to move into a smaller home, and it might be the perfect time to do so. Read our blog to find out some of the benefits to downsizing from a house to a condo and how you can do it in the best way for you and your wallet.

1. Should I Downsize From a House to a Condo?

Many Twin Cities residents are thinking of making the switch from being Single-Family homeowners to condominium homeowners. In 2022, the demand for homes is high, but the condo market has been easier to navigate as a buyer. Read our blog about 10 Reasons to Sell Your Home Now to see if it's the right move for you.

There are many similarities and differences between the two styles of living. Here are some reasons people choose to downsize from a house to a condo:

  • Your kids have moved out of the house and you have a lot of extra space.
  • You want to diversify your real estate portfolio - Downsizing may allow you to buy a second home in a different location. Ready to be a snowbird?
  • You like to build community and share common space with others.
  • You want to continue building equity, but no longer want to do yard work or be solely responsible for costly home expenses.
  • You want access to many of the great amenities offered in condominiums.
  • Your health has changed or your mobility is limited.

2. Benefits of Downsizing From a House to a Condo

There are many different benefits to consider before downsizing from a house to a condo. Depending on your stage in life, it may be the perfect option for you. Whether you've just experienced a big lifestyle change or you're preparing to retire and hope to split your time between the Twin Cities and somewhere with a warmer climate, check out some of the benefits of condo living:

  • Condos typically require less maintenance (interior and exterior).
  • Condos may have less square footage to furnish and maintain.
  • Many condominiums, including converted mansions, in the Twin Cities have elevator access and/or one-level living.
  • Homeowner's Associations (HOA) typically are in charge of maintaining the building, including expensive repairs such as roofing and landscaping.
  • Some HOA fees include utility bills such as heat, electricity, wifi, etc, which can lower the number of monthly payments a condo owner is responsible for. 

3. How to Downsize From a House to a Condo

The first step to downsizing from a house to a condo is to meet with an experienced realtor to discuss your history, future goals, and your motivations. The HIVE team of Twin Cities realtors are not only experienced, but have the patience and hard work ethic to help you achieve all of your real estate goals. Visit our blog about selling your home for a step by step guide about what to expect during the selling process. 

Transitioning from a single-family home to a condominium can be quite a different experience, but with The HIVE's experience throughout the Greater Twin Cities region, we can be sure to provide excellent service, step-by-step assistance, and vast knowledge of the current market.

To get started downsizing today, we provide tips on our blog with 4 steps to prepare your home for sale. 

Start Your Downsizing Journey Today!

Contact us to start touring homes for sale today! We will provide you with a Competitive Market Analysis of your home and assist you throughout the entire process of downsizing from a house to a condo.

April 18, 2022

Twin Cities Earth Day Shindig 2022

 

Twin Cities Earth Day Shindig 

Mississippi River Clean Up

Friday, April 22nd, 2022 from 4:00-6:00pm

Hidden Falls Regional Park

The HIVE, St. Paul Pet, and Bob Mitchell's Fly Shop have teamed up as sponsors of a spring clean up event to help protect one of the greatest resources in our area, the Mississippi River.

Come down to Hidden Falls Regional Park for a family and dog friendly event! Participants will fill garbage bags with as much debris as possible. Then, stick around for acoustic tunes by local musicians, Mike Munson and Mikkel Beckmen, share a drink with friends, and eat delicious food!

West Indies Soul Food Truck has lined up a mouth-watering Caribbean menu of Jamaican patties and jerk chicken. While supplies last!

We're hiring our friend, Bethany Becnel, a local facepainting artist to come and make us all look glamorous! Check out these amazing faces! Visit her instagram page to see more fun creations.

  • Wear weather appropriate clothing--This event is rain or shine! 
  • Closed Toe Shoes Recommended
  • Make sure you'll be okay if your clothes or shoes get dirty. 

If you have the following items, please bring them along!

  • Garbage bags
  • Gloves
  • Camp Chairs
  • Picnic Blankets

The sponsors are providing materials, but may not have enough for everyone!

 

Weather permitting, a couple boats will be dropping participants off at different locations along the riverbank to cover as much ground as possible! 

RSVP to our facebook event.

Please reach out to Megan at thehive@socialresponsiblerealtors.com with any questions!

Posted in Community News
April 18, 2022

Mya Honeywell & The HIVE Excel in the Real Estate Market 2022

Mya Honeywell & The HIVE Real Estate Team excel in the real estate market 2022. Selling nearly 200 houses since 2020, their tight-knit team is one of the strongest in the Twin Cities.

Contact The HIVE to turn your wish lists into reality, they're licensed in Minnesota & Wisconsin.

 

 Residential Investment Luxury Second Homes

 

1. Mya Honeywell

Honeywell’s award winning career grew from her background in pharmaceutical and software sales where she mastered the art of negotiation and fostered a strong work ethic. 

As a mentor and leader, she brings years of real estate experience as well as nationally acclaimed Fortune 100 level sales results. Mya and The HIVE can guide you through the intricate process of buying and selling.

2. The HIVE

Honeywell leads a team of six realtors who deliver outstanding results helping people buy and sell homes with efficiency and passion. Learn about the members of The HIVE team and what drives their ability to create meaningful connections with clients and community members.

Don’t miss the espresso drinks at their office space on Selby & Snelling in Saint Paul–the perfect place to discuss your next move.

3. Population Growth

More than ever, people are flocking to the Twin Cities from other states. Honeywell has helped over a dozen families buy homes from out-of-state in the last two years. She uses her expertise about home inventory throughout the metro area and technology that keeps buyers poised to win, even from different time zones. 

Based on the most recent report from the Metropolitan Council, the Twin Cities region is forecasted to hit 4 million residents within the next few decades. With an influx of nearly 1 million people moving to the Twin Cities by 2050, home inventory will likely continue to be in high demand.

4. Twin Cities Real Estate Market Over the Last 5 Years*

Over the last 5 years, the Twin Cities real estate market has changed dramatically; however, the most dramatic change seems to have occurred since the start of the COVID-19 pandemic. Market data shows that from the years of 2017 through 2020, the average sale price of homes varied greatly. In June 2020, average home sale prices began climbing, hitting it's five-year highpoint in August 2021, as seen in the interactive graph below. 

 

5. Current Market Insights*

Over the last year, prices remain high, with record low number of days on market. Meaning when a homeowner sells their home today, they are likely to sell for greater than the list price and less than a month from listing day to closing day. The data in the graphs below is from March 2022, but the interactive graphs update automatically.

    • Average Sale Price: $628,284 (+1.8%)

    • Average Days on Market: 26 (-55.9%)

    • Average Price per Square Foot: $206 (+9.6%)

    • Average Percent of Original List Price: 102.1% (+3.5%)

 

6. Minnesota & Wisconsin

Realtors at The HIVE, Coldwell Banker Realty, understand the importance of offering clients a full-service experience as they buy or sell a home. Honeywell encouraged her mentee, Megan Harty, to become a licensed Wisconsin real estate agent in addition to Minnesota.

Minnesotan's look no further, Wisconsin has everything you need for vacation homes, minus the weekend traffic. Visit our blog on Buying a Second Home in Wisconsin to learn about the benefits. 

The blog discusses the following topics:

1. Reasons to Buy a Second Home in Wisconsin

2. Where to Buy a Second Home in Wisconsin

3. Down Payments on a Second Home in Wisconsin

4. Rental Income on a Second Home in Wisconsin

5. Finding a Realtor for Buying a Second Home in Wisconsin

 

Whether you are in the market to buy, sell, invest, or expand your real estate portfolio, Mya Honeywell and The HIVE provide award winning service. 

Contact Mya Honeywell to turn your wish lists into reality!

 

*All data is based on Single Family homes greater than $410,000 in the Greater Twin Cities Region.

April 11, 2022

Twin Cities Home Buyer Event 2022

The HIVE Real Estate Team is hosting an upcoming Twin Cities home buyer event designed to help people navigate the high demand real estate market of 2022. Whether it is your first time buying a home, or you're looking to sell your current home and buy a new one, this event is for you!

Contact us to set up a personal home buying appointment. We offer virtual and in-person services throughout Minneapolis, Saint Paul and all of the surrounding communities.

1. Overview

  • The process of buying a home from start to finish.
  • The HIVE's buyer success in the 2022 Twin Cities real estate market
  • Lending & Mortgage information
  • Down Payment Assistance information
  • Current market statistics

2. Date & Time

April 14th, 2022 from 4-6pm

3. Location

The Lab Brewery - 767 N Eustis St. Suite 115, Saint Paul, MN 55114

The HIVE is hosting drinks during the event. The Lab offers beer, seltzers, and kombucha. 

Let us know you're interested in learning more about the home buying process.

One of our Twin Cities realtors will be in touch as soon as possible.

April 4, 2022

Buying a Second Home in Wisconsin

Have you been thinking about buying a second home in Wisconsin?

The realtors at The HIVE have experience working in Wisconsin and working with out of state buyers looking for a cabin. We put together this quick blog about buying a second home in Wisconsin. Read our blog for more information on how to find your dream vacation home.

If you have additional questions, or are reading to find your second home, contact us today.

1. Reasons to Buy a Second Home in Wisconsin

Buying a second home is a big decision that can come with many benefits. Here are some:

        • Expand and diversify your real estate portfolio
        • Escape from the hustle and bustle of city life
        • Spend more time in the great outdoors
        • Earn rental income

2. Where to Buy a Second Home in Wisconsin

Many Twin Cities homeowners are looking to Northwestern Wisconsin for their vacation getaway. Why? In short, Northwestern Wisconsin is beautiful. Between the rolling hills, numerous lakes and rivers, hiking trails, and forests—you can’t go wrong. A few of the major highlights within a few hours drive of the Twin Cities include:

3. Down Payments on a Second Home in Wisconsin

Buying a second home is slightly more complicated than buying your first home. If you are looking to get a mortgage for your second home, you will likely need a larger down payment and have to pay a higher interest rate. It’s important to discuss with a lender before touring homes to verify what types of homes will be a good financial fit for you, your family, and your goals.

4. Rental Income on a Second Home in Wisconsin

People are flocking to Wisconsin lakes and rivers and paying top dollar to stay in Airbnb or VRBO rentals, camping on private property, renting out tiny homes or glamping in yurts. While owning a rental property can take a large initial investment, each time your property is rented out, you earn income that you may use to improve your property or help pay your mortgage. If you’re only planning to occupy your second home for a couple of weekends each month, it may be a great idea to set it up to rent out a week or two. Visit our investment property blog to learn more about the benefits.

5. Finding a Realtor for Buying a Second Home in Wisconsin

It's important to find someone you can trust when you start the process of buying a home. Well connected realtors can have access to properties that may never hit the active market, and their knowledge will prove priceless when you've found your dream home. Our team has a licensed realtor in both Minnesota and Wisconsin, so we understand both markets and can help you maximize your real estate portfolios through our connections in both states. 

6. Buying a Second Home in Wisconsin

  • Find a lender you trust
    • If you had a great experience buying your first home, reach out to your lender to start getting pre approved for a second home.
    • If you're looking for a new lender, ask the experts. We can recommend our "go-to" lenders who have great testimonials from our clients.
  • Start touring homes
  • Meet with The HIVE's Wisconsin licensed real estate agent 
    • Come visit our Saint Paul office! We'll drink cappuccinos and discuss your goals.
    • What is your timeline? What house characteristics are on your wishlist?
  • Make an offer 
  • Get a home inspection and read our blog about the importance of home inspections.
  • Escrow Period - If it's been awhile since you've purchased a house, read our guide to closing
  • Closing day! Pop the champagne!

 

Let us know if you have any questions about buying a second home.

One of our experienced realtors will be in touch as soon as possible. 

We can start the process today!

 

Posted in Buying a Home
March 30, 2022

10 Reasons to Sell Your Home Now 2022

Here are the top 10 reasons to sell your home now in 2022. If any of these reasons resonate with you, contact us to navigate this market and sell your home.

1. The Demand for Homes is High

  • The number of buyers in the Twin Cities market outweigh the number of houses available. In order to have a balanced housing market in the Twin Cities metro area, there would need to be approximately 18,000 homes for sale.
  • The Inventory of Homes for Sale as of February 2022:
    • 2,930 Single Family Homes
    • 705 Townhomes
    • 650 Condominiums
  • These numbers are record lows for the Twin Cities housing market, which explains why prices are high and homes are selling fast once they hit the market.

2. Houses are Selling for High Prices

Homes were selling for high prices in 2021 and they’re only getting higher in 2022. In February 2022, the median home sales price was $371,539 – almost 12% higher than in February 2021!

  • What does this mean for sellers?
    • A buyer will likely offer to purchase a home for a higher price than the advertised selling price.
  • In February 2022, Twin Cities homes in the $250k-$350k range sold for 102.9% of list price, gaining sellers almost 3% extra on the sale!
  • Price per square foot is also on the rise – up 11.7% since 2021. Single Family homes in the Twin cities are now averaging about $192 per square foot compared to $171 last year at this time.

3. Homes are Selling Quickly

When a seller accepts an offer for their house, a typical closing period takes 30-45 days to process the loan and complete the title work for the transaction.

The average closing period has decreased dramatically over the last year. Currently, the average time to sell a house in the Twin Cities is 27 days– down from 41 days in 2021.

4. Buyers are Waiving Inspections

  • In the past, buyers have been guided to elect a home inspection in order to validate the sale price and ensure the house does not have any unforeseen problems.
  • Right now, many buyers are waiving inspections in hopes of submitting the most competitive offer and getting the chance to become a homeowner.
  • Sellers still must disclose any material defects and provide the buyers with as much information as possible. It is a huge investment and it is helpful when sellers are forthcoming with any issues they have dealt with or discovered during their stewardship of the home.

5. Home Appreciation

Homes have appreciated increasingly over the past two years, an average of $17,000 in equity according to data from CoreLogic. Many homeowners are choosing to cash in on that equity and make a move to their dream home.

6. You’re Ready to Upgrade to a Bigger, Better Home

Although prices are higher, you can use it to your advantage. If you’ve been in your home for awhile and have saved enough for a downpayment on a new house, you could buy your new home before selling your old home. This is a huge advantage in this market and we’ve seen great success with our own clients.

In early March 2022 we helped a client buy a newer house that is twice as large as the first home she purchased about four years ago. Once her new house was under contract, she listed her old house for sale-- it sold with multiple offers, over asking price, and in just a few days!

7. Your Housing Needs Have Changed

Whether it's working from home, getting engaged, or having a baby—everyone’s had big life changes since the pandemic started. Many people are spending more time at home than they ever have before and are starting to see their needs have changed.

Perhaps you’ve found yourself daydreaming about more bedrooms or a kitchen built for entertaining. Now is the perfect time to find the home of your dreams, and cash out on your old house while the demand is high.

8. You’re Ready for a New Location

Are you looking to be closer to family (or farther? We won’t ask questions.) Or maybe you’re living in the city and daydreaming about wide, open spaces. Either way, we can help make your move seamless.

9. Supply Chain

Many new construction developments and home builds have been delayed as supply chain issues were exacerbated by the COVID-19 pandemic. On top of the supply delays, material costs rose significantly, which means less people are going the route of building homes. An already low supply of homes means homes are selling as fast as they hit the market.

Thinking ahead-- As supply chain issues are solved, home inventory will begin to grow, likely creating a less desirable sellers market in the future.

10. Should I Sell My House Now or Wait Until 2023?

With interest rates rising, there’s no telling how long the high buyer demand will last in the Twin Cities housing market. What we know now is that there is huge demand for homes, decreasing days on the market, and increasing prices–it’s a great time to take advantage of it and sell your house!

Let us know  if you have any questions about selling a home in the Twin Cities. One of our experienced realtors will be in touch as soon as possible. 

We can start the process today!

Visit our blogs about Selling Your Home or Selling Your Multi-family Investment Property.

Posted in Selling Your Home