Understanding the Fergus Falls Real Estate market: a Seller's Perspective

It is only fair that I provide equal time and guidance for property sellers in today's real estate market. My last post related to buyer opportunities. This time we will focus on opportunities available to sellers.

To put it another way, let's leverage our strengths as sellers to kick the 'Hee Haw' out of the market seesaw. Seller's need to flex their property attributes to balance the seesaw market. Instead of having prospective buyers 'holding sellers up', let's look at what sellers can do to restore a balanced and level playing field.

But before I speak on specific strategies for sellers, we need to be certain we understand our local market and debunk some myths - a.k.a. 'obviate the rubric'.

We have all heard the latest national real estate news. It reminds me of that refrain from the late '60's 'Hee Haw' show with Roy Clark and Buck Owens: 'Gloom, despair, and agony on me.' National housing market news trends often focus on worse-case scenarios, and averages at best. Here is what we need to keep in mind: Local economies and markets may bear no similarity to national trends. In fact, the local market might be far healthier. What sellers need to overcome is the national media mindset that has been embraced by prospective buyers.

For the remainder of this post I am going to highlight some statistics specific to the Fergus Falls market. I believe this information will clearly show our local market is making improvements in key areas and, more importantly, potential sellers need not hang their heads as though they were on their way to the gallows.

This first graph shows a geographical comparison of foreclosure rates as of December 2011. The graph displays, a national rate, a rate for the state of Minnesota, an Otter Tail County Rate, and the rate for Fergus Falls. Please note the marked difference in rates from the National level to those of Otter Tail County and Fergus Falls. (Be sure to see more foreclosure information at my RealtyTrac page.

This second chart shows foreclosure activity and average mortgage rates for Fergus Falls as of December 2011. I'm hoping this information is alleviating some seller heartburn! As we Minnesotan's are prone to say, 'Things could be worse.' Again, this information is provided by RealtyTrac. More RealtyTrac information can be viewed at my RealtyTrac page.

Just a couple more numbers and I'm going to wrap this up. According to our local MLS data, 134 Fergus Falls homes were sold in the last six months of 2011. This compares to only 102 in the same period of 2010 reflecting a gain in unit sales of 31%! Wow!! Here is one catch: the average selling price dropped in 2011 compared to the same period for 2010. Bummer. But all is not lost! What this means is, although sale units were UP, the average selling price of the sold properties dropped. What we observed in this time frame is the bulk of homes sold were in the $60,000 to $115,000 price range.

I'll conclude this discussion for now to allow a little time to digest this information. Be sure to check out my next blog post: What can a seller do to maximize their return if there property is valued above the average range of sold properties? Stay tuned . . .

Jon Drews, Associate Broker with Century 21 Vista, Inc. in Fergus Falls MN.

Looking for a 'Screamin' Deal'?

Hi there! Today's topic: Screaming Deals. Real Estate buyers are always looking for the best value in property. So let's talk about value - specific to real estate.

In today's real estate market - generally speaking - buyers are receiving a great deal of value with their property purchases. This is because our real estate market has experienced decline over the last couple of years. When prices fall a buyer gets more 'bang for the buck' from their purchase = greater value = screaming deal. Nothing new here - all of us hear about the struggling real estate market in the news - day after day after day after . . . Remember: It is a buyer's market - and opportunities abound!

That brings us to back to screaming deals, and, foreclosures - their presence being a solid indicator all is not well with the housing market. However, purchasing a foreclosure is the greatest kernel of opportunity for a buyer looking to land a 'screaming deal'. Remember this: even though the presence of foreclosed properties in the market are an indication the market is not 100% healthy, foreclosed properties are absolutely 100% opportunity for the knowledgeable and ready buyer.

Unfortunately, not all foreclosures are created equal. To put it another way, a prospective buyer has to be very, very careful and well guided when considering a foreclosed property. Why, you ask? Two words: as is. Foreclosed properties (also called 'bank owned' properties are sold 'as is'. This means if a person purchases a foreclosed property with major plumbing issues, they are the buyer's major plumbing issues. Foundation issues - buyer's problem. If the roof leaks - the buyer owns the leaking roof. 'As is': two very small words that can pack a powerful punch!

To help alleviate some of the 'as is' risk I strongly recommend a potential buyer invest in a home inspection - a contingency to the purchase commitment. Have your target property inspected by a trained professional. If there are problems they need to be identified before a purchase price is finalized. Additionally, find a professional, experienced real estate agent to help guide the process.

Earlier I mentioned a buyer not only needs to be knowledgeable but also ready. A prospective buyer needs to be ready to act quickly when the target property is offered for sale. A prospective buyer should be pre-approved to make the purchase commitment if financing will be a consideration.

Make a plan to be the best prepared buyer in the market - as opportunities can evaporate quickly.

The final item I would like to mention is really exciting: I have joined the Realty Trac Agent Network! You can check out my Realty Trac search tool here.

Realty Trac is a nationally recognized resource for property foreclosures. They provide a powerful, up-to-date search engine that will give serious buyers of foreclosed properties an incredible advantage when trying to secure the somewhat elusive 'screaming deal'. Want to better improve your odds with a foreclosure opportunity? Check out my Realty Trac page now - or call me . . . now!

The clock is ticking - your dream property might be slipping under your nose at this very moment!

Sincerely -

Jon Drews - your real estate partner - and area foreclosure expert.

Market Watch for January

Greetings! Winter has arrived (sort of) in Minnesota. By that I mean it is colder than blazes! This is making the ice fishing fraternity very happy - but the snowmobiling crowd is still facing some pretty tough sledding (mainly because we have NO SNOW!). Crazy.

Of course we still have the Super Bowl to look forward to - and taxes don't need to be done for a while. All in all it is the PERFECT time to stay inside and start planning for a home upgrade, or downsizing, or the perfect lake spot! (Remember - those perfect lake spots can do wonders for ice fishing as well!!)

Granted, the market is calmer than it was a couple of years ago but nice properties are bringing a respectable price for sellers - and interest rates are ridiculously low for buyers!

And here is one more tidbit I want to share: I have been working hard on putting together a set of websites to serve both the Fergus Falls real estate market as well as the greater Otter Tail County area. In addition, I have a website designed to specifically serve the needs of those interested in lake properties!

Here are the sites: FergusFallsRealEstate.com, OtterTailHomes.com, and OtterTailLakes.com. Check them out. And, please, if you have any suggestions to better serve your needs just drop a line. I would love to hear from you!

In closing, yes, it is cold enough for me - you need not ask! Cheers!!