What is going to happen with Hennepin County, Minneapolis, St. Paul, Twin Cities REO – Bank Owned – Foreclosures in 2011, all reports sale that more foreclosures are coming….

Minnesota FOX 9 has a great report about MN Minnesota/St. Paul/Twin Cities 2011 Foreclosures:

Minnesota Foreclosures Bigger in 2011?: MyFoxTWINCITIES.com

http://www.myfoxtwincities.com/dpp/news/Minnesota-Foreclosures-Bigger-in-2011-jan-18-2011

This news piece on MN Minnesota Bank Owned REO Foreclosures spells out what we really need to fix this Foreclosure mess. We need buyers to buy these Twin Cities Minneapolis Saint Paul REO Foreclosures!  The problem can be getting financing for these types of properties.  Any first time buyer should find FREE DOWNPAYMENT CASH when financing their purchase of a bank owned foreclosure.  One of the best resources I have seen is: http://www.mndownpaymentassistance.com/ via the programs offered by Joy Bender, Lake Area Mortgage – buyers have been getting up to $8500 in down payment assistance. For more info, Joy can be reached via email @ jbender@lakeareamtg.com or (612)227-2065.

Here is an interesting scenario, you put in an offer on a bank owned, reo, foreclosure home, you offer is higher than any other offer, and you don’t get the home? This allegedly happened to a couple looking to purchase a Brooklyn Park, MN Minnesota twinhome. The Star Tribune reported that The Minneapolis Area Association or Realtors will be holding an ethics hearing on the matter. Realtors, agent, brokers are required to presents “any and all written offers” for real estate. The buyers for this Brooklyn Park, MN listing had brought the “highest and best offer” and found out that a lower bidder got it.

From The Star Tribune, 11/26/2010, 

Couple lose out on home; Realtors face ethics case

“From the moment Erica and Mike Lenzen saw a foreclosed twin home for sale in Brooklyn Park, they thought it should be theirs. They even put in a no-strings-attached offer $8,000 above the asking price. But the home was sold to someone else. The Lenzens got suspicious when they learned the house sold for $2,000 less than their offer. When Mike Lenzen tracked down the bank representative in charge of selling the property, she told him she had no record of receiving the couple’s offer. Despite all the regulation and disclosure, buying a home can be a secretive process. Buyers are largely at the mercy of what sellers and their agents tell them. It’s especially mysterious these days, as foreclosed homes flood the market and the banks that own them make sales decisions that sometimes defy explanation. Most buyers who lose out on a deal just move on. The Lenzens spent weeks investigating the transaction and scrutinizing documents. They are convinced their offer was withheld by the bank’s agents at EXIT Realty Metro. They’re not quite sure why, except that the winning bidder, an investor who plans to rent it out, had no agent, allowing EXIT Realty to earn a larger commission.”

http://www.startribune.com/local/north/110890349.html?elr=KArksLckD8EQDUoaEyqyP4O:DW3ckUiD3aPc:_Yyc:aUac8HEaDiaMDCinchO7DU

If you are thinking of buying a foreclosure home, condo, townhome, twinhome or land, you need a good buyer’s agent to ensure your offer is presented and received and that you have all the info to put in the best offer. It is important to work with a Realtor/real estate agent that knows REO Foreclosure properties. Although there will be other listings in the Brooklyn Park area for these buyers and I am sure they search the MLS daily for new bank owned deals, they felt they were slighted in this deal and they want justice! Brooklyn Park borders on Brooklyn Center, Fridley, Champlin, New Hope and Maple Grove Minnesota. – John Schuster is the #1 Listing Agent with Coldwell Banker Burnet in 2010 and is a leader in Foreclosure/Bank Owned/REO properties and listings.

It looks as if Twin Cities (Minneapolis  & St. Paul Saint Paul) Foreclosures (REO) activity is on the rise.  What does this mean for you if you are an investor or home buyer?  A good deal!

Yesterday, there was an article in the Star Tribune by veteran reporter  ( Jim Buchta • 612-673-7376  jbuchta@startribune.com )

http://www.startribune.com/business/107117148.html?page=1&c=y

“With foreclosures still entering the market at near-record pace, inventory levels continue to rise. And even though the number of new listings slowed last month, total inventory is 10.6 percent higher than last year at this time. That, coupled with a decline in sales, has caused the supply of houses on the market to increase from 6.1 months in October 2009 to 8.2 months last month. That means that at the current sales pace and inventory levels, there are enough houses on the market to last 8.2 months if no new inventory were added.”

Twin Cities housing prices are going to continue to decline, it’s simple supply and demand.  Bank owned REO  foreclosures, short sales continue to rule the market.  With an increasing supply of these distressed sales on hand, regular sellers can have a difficult time competing!  Investors have been picking up investment property (Duplexes, Triplex, FourPlex 4-plex) and such a discount, they CASH FLOW with very little money down!  First time buyers can now purchase affordable homes!  (although if they are using FHA financing, which they all are, the home must be in FHA -able condition) – John Schuster, Top REO Broker in the Twin Cities area!

Q3 Minneasota REO Foreclosure stats are out and MN Twin Cities (Minneapolis and St. Paul) Hennepin County, Ramsey County, Dakota County, Carver County, Washington County, Anoka County and Scott County bank owned properties are on the rise. 

St. Paul’s Pioneer Press stated:

“Foreclosures in Minnesota are on the rise again, climbing more than 23 percent in the third quarter from a year earlier, with the metro area driving the upward trend. Statewide, foreclosures in the third quarter hit the second-highest level on record at 7,254. The only quarter with a higher level was the third quarter of 2008, when the state reached 7,349 foreclosures, according to Friday’s report from HousingLink, a Minneapolis-based nonprofit that studies housing issues.”

Full article http://www.twincities.com/business/ci_16533752?nclick_check=1

This could spell trouble for the Twin Cities real estate marketplace.  Real estate prices might not start to see an upswing for years to come and Bank Owned REO Foreclosures continue to pull down on home, townhome and condo values!  The upside? If you are a real estate investor looking for Single Family Homes, Duplexes, Triplexes, Fourplexes and other multifamily properties can get a sweet deal!  If you looking for CASH FLOW investment properties, you can actually find them now! If you are a home buyer (and do not need to sell a home to buy a home) there may never be a better time to buy! 

If you are looking for Fannie Mae or Freddie Mae (GSE) bank owned REO foreclosure, they have direct access via:

http://www.homepath.com/state/mn.html

http://www.homesteps.com/hm01_1featuresearch.htm

or if you like to search the MLS for Minneapolis, St. Paul, Twin Cities foreclosures, you can search the broker reciprocity Twin Cities Housing database via: http://mnforeclosureproperties.com/hnav/search-foreclosures/

or if you would like a custom search set up, please contact John Schuster, Coldwell Banker Burnet @ jdschuster@cbburnet.com 612-924-7140 www.johnschustergroup.com www.TwinCitiesListed.com www.TwinCitiesCondoShop.com 3033 Excelsior Blvd #100, Minneapolis, MN 55416

DUPLEX OF THE WEEK – 620 Buchanan Street NE, Minneapolis MN http://mnforeclosureproperties.com/tc/spw/3961292/index.do

If you like to SEARCH THE MLS and have been looking for a Minneapolis Duplex for sale,

this could be the one!  This is a bank owned foreclosure REO Minneapolis Duplex and has just

been reduced to $94900!  This duplex has 1-3 bedroom unit and 1-2 bedroom unit.

Incentive! Seller Will Pay 3.5% of Sales Price Toward Closing Costs w/Own/Occupy Buyer. Great NE Mpls Up/Dn Duplex Investment Opportunity. Spacious Flrplns,Lg Rms,Hwf,Off-St Pkg,4 Seas Porches,More! Mins to U of M,St Anthony Main,DT,Shops/Entertainment

If you are looking for investment property and searching for Minneapolis cash flow duplexes, contact John Schuster @

jdschuster@cbburnet.com 612-924-7140

The Minnesota foreclosure machine for the most part has not been affected by the recent halt to foreclosures by some of the big mortgage players (Bank of America BAC, PNC
Financial, Chase). This is mostly because Twin Cities foreclosures (actually all Minnesota foreclosures) happen in a redemption state. If the owner has cause, she or he can likely get the sheriff’s sale postponed and after the Minnesota sheriff’s sale has happened, the prior owner has 6 month’s to “redeem” themselves and take back title to their home. MN NPR has an interesting article about this issue.

http://minnesota.publicradio.org/display/web/2010/10/17/foreclosures/
For more info on Hennepin County Foreclosures, Hennepin County Sheriff’s Sales,Dakota County Foreclosures, Dakota County Sheriff’s Sales, Anoka County Foreclosures, Anoka County Sheriff’s Sales,Carver County Foreclosures, Carver County Sheriff’s Sales,Washington County Foreclosures, Washington County Sheriff’s Sales,Scott County Foreclosures, Scott County Sheriff’s Sales,Ramsey County Foreclosures, Ramsey County Sheriff’s Sales http://mnforeclosureproperties.com/?p=161 

Here is an interesting interview with PBS and HUD Secretary Donovan

All in all, the foreclosure are going to keep coming. I think we will see a little more QC done during some of the legal filings and such, but the banks are going to take back homes where someone is not paying their mortgage. For the most part Twin Cities (Minneapolis and St. Paul), Hennepin County / Ramsey County / Dakota County / Washington County / Anoka County / Carver County / Scott County foreclosures (REO) listings will continue to work their way through the legal process and be resold on the open market. Coming into the winter market with an ever increasing inventory has created some fabulous opportunities for investors to pick up some excellent CASH FLOW properties with little money down. I think we have about 2-4 more years of this market. The best deals will be in the next year to 18 months before Minnesota foreclosures start to tapper off. If you have good credit, a little money, time to put into an income property and you want to wealth in a decade from now, talk to a good Minneapolis / St. Paul Twin Cities Minnesota real estate broker. – John Schuster

Looking for steal of a deal on your next home? Do you think buying your next Minneapolis Home, Minneapolis Condo or Minneapolis Town Home at a real estate auction can save you tons of money? Maybe so, especially if that auction is a foreclosure (REO) Auction! Hudson and Marshall just left the Twin Cities (Minneapolis and St. Paul) on their Midwest home selling spree!

Here you can see a listing @ 140 10th Street S, South St. Paul MN that was last actively listed @ $119,900 that “Sold” at the Minnesota foreclosure auction at almost half price! This is what I call “Cheap MN real estate”. Note that most real estate foreclosure auctions have a “reserve” price and if the property does not fetch the reserve price – the seller (i.e. the foreclosing bank) can decide if they want to accept, reject or counter the auction sale price.

Auctions can be a great deal and a major headache! First, you must do ALL of your due diligence (buyer inspection) prior to bidding. You might need to pay an inspector to inspect a home that you do not yet own – and might be outbid at auction! Second, you most likely need to be a Cash buyer of real estate as auction sales cannot be contingent upon financing. And third, most auctions have a “buyer’s premium” added to the sales price which is usually 5%. This means if you are the winning bidder at the auction for $100000, this home will really cost you $105000.

Know what your doing if you buy via auction…and if you don’t find a good Realtor that navigate all the Twin Cities auction pitfalls for you. – John Schuster

My team and I have begun to notice that many first time buyer homes are now selling in multiple offers!  In fact multiple-multiple offers – one bank owned (REO listing) had 11 offers!  If the property is move in ready and is priced way below the other active listings – it sells fast!  Banks have been getting wiser to have their inventory of homes in better condition and have them priced correctly out the door!  Fannie Mae, a lender that The John Schuster Group, with Coldwell Banker Burnet, represents in the Minneapolis and St. Paul area, has stringent requirements for how their properties must look.  The goal is for the foreclosure not to look like a foreclosure!  Our inventory has been drying up in the Twin Cities:

http://online.wsj.com/article/SB124044612611045827.html

One might think that we are nearing the bottom because the foreclosure inventory is drying up.  One would be wrong to think that!  All of the big banks and mortgage holding companies (including Fannie Mae and Freddie Mac) have had a moratorium on foreclosures from mid-November, 2008 to April 1, 2009.  They are all so backloged with 5+ months of defaults (on properties that were not foreclosed on during the moratorium), plus new defaults that a tsunami to reo’s are-a-coming!

Expect a high number of sheriff-sales in the next couple of month, then a cure time of 2-6/months for redemption (depending on if the property is abandoned), then about another month of time for cleaning and market evaluations (BPO, Broker Price Opinion and an appraisal) and then it his the market.  I predict we will have a flood of new REO’s mid-fall 2009.

http://online.wsj.com/article/SB123975395670518941.html?mod=googlenews_wsj

-Year to day (4/26/09) John Schuster and his team have sold over 68 properties in 2009, many of them being “bank owned foreclosures”. Schuster and his team have sold foreclosure homes, town homes and condos this year in Minneapolis, St. Paul, New Hope, Maple Grove, Savage, South St.Paul, North St. Paul, Maplewood, White Bear Lake, Woodbury, Bloomington and Uptown. You can follow John Schuster on Twitter @ Twitter@jdschuster

http://www.finance-commerce.com/article.cfm/2009/02/28/Foreclosure-relief-on-way-to-21-Minnesota-counties-cities

“Carter was one of many Minnesota politicians – including two mayors and the state housing commissioner – who gathered at the home, on the corner of Sherburne Avenue and Arundel Street, to announce how $38.3 million in federal dollars will be allocated to 21 cities and counties for rehabilitation and redevelopment of foreclosed homes.

The federal dollars, from the Federal Housing and Economic Recovery Act of 2008, were originally announced in September. At that time, the feds announced nearly $58 million in awards to Minnesota. (Of that $58 million, about $19 million has already been distributed collectively to the cities of Minneapolis and St. Paul and the counties of Hennepin, Dakota and Anoka.)”… from Finance and Commerce 2/27/09 (see link)

Comment by John Schuster – Government money to help to housing crisis?  St. Paul & Minneapolis and Hennepin County, Dakota County and Anoka County need what ever stimulus spark to rev up their housing markets.  A lot of this is a simple supply and demand function – There is an excessive amount of REO Inventory (foreclosures) in the Twin Cities Minnesota area.  That, combined with a tightening credit market – which further reduces the pool of buyers and depresses the prices at which they can purchase – can lead to a downward spiral in a “free market” economy.  Government is the only thing that can fix this thing now.  If we want to have any resemblance of the America we were born into and have grown to love – drastic action needs to be taken.  This government funds noted in this article may be just be a drop in the bucket, but it is a start to correcting our situation.

Worst, No. 4: Minneapolis, Minn.

Index score: 127

Prices were last this low: April 2002

Month-to-month drop: -4.6%

Year-over-year drop: -18.45%

Deceleration rank: No. 20

http://www.forbes.com/2009/02/24/housing-cities-ten-lifestyle-real-estate_home_prices_slide_18.html?thisSpeed=15000

Forbes.com just released data from S&P/Case-Shiller home-price index, released Feb. 24, 2009.

They state that Minneapolis, MN is the #4 worst housing market in their “10 Best And 10 Worst U.S. Housing Markets”.  Although our real estate market has gone through tremendous stresses in the last year, there is no way we should have even made this list.  We have seen values drop 5-50+% depending on which area of Minneapolis you focus on.  The SW Minneapolis and Lakes area have been able to hold their values much better that North Minneapolis, Phillips and Powderhorn neighborhoods.  The silver lining to declining market values is affordable housing.  First time buyers now have the opportunity to own homes that they can actually afford.  If you are thinking of purchasing a home in Minneapolis or St. Paul or in the Twin Cities metropolitain area, now may be the time.  It is very important to find an agent that know foreclosures / REO properties and regulations in Minneapolis, St. Paul or the municipality in which that home resides.