Housing Market Expected to “Spring Forward”

Housing Market Expected to “Spring Forward”

Just like our clocks this weekend in the majority of the country, the housing market will soon “spring forward!” Similar to tension in a spring, the lack of inventory available for sale in the market right now is what is holding back the market.

Many potential sellers believe that waiting until Spring is in their best interest, and traditionally they would have been right.

Buyer demand has seasonality to it, which usually falls off in the winter months, especially in areas of the country impacted by arctic temperatures and conditions.

That hasn’t happened this year.

Demand for housing has remained strong as mortgage rates have remained near historic lows.

The National Association of Realtors (NAR) recently reported that the top 10 dates sellers listed their homes in 2016 all fell in April, May or June.

Those who act quickly and list now could benefit greatly from additional exposure to buyers prior to a flood of more competition coming to market in the next few months.

Bottom Line

If you are planning on selling your home in 2017, let’s get together to evaluate the opportunities in our market.

Top 5 Reasons You Should Not For Sale By Owner

Top 5 Reasons You Should Not For Sale By Owner

In today’s market, with home prices rising and a lack of inventory, some homeowners may consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). There are several reasons why this might not be a good idea for the vast majority of sellers.

Here are the top five reasons:

1. Exposure to Prospective Buyers

Recent studies have shown that 94% of buyers search online for a home. That is in comparison to only 17% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

2. Results Come from the Internet

Where did buyers find the home they actually purchased?

  • 51% on the internet
  • 34% from a Real Estate Agent
  • 9% from a yard sign
  • 1% from newspapers

The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

3. There Are Too Many People to Negotiate With

Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale By Owner:

  • The buyer who wants the best deal possible
  • The buyer’s agent who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies, which work for the buyer and will almost always find some problems with the house
  • The appraiser if there is a question of value

4. FSBOing Has Become More And More Difficult

The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

The 8% share represents the lowest recorded figure since NAR began collecting data in 1981.

5. You Net More Money When Using an Agent

Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.

Studies have shown that the typical house sold by the homeowner sells for $185,000, while the typical house sold by an agent sells for $245,000. This doesn’t mean that an agent can get $60,000 more for your home, as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.

Bottom Line

Before you decide to take on the challenges of selling your house on your own, let’s get together and discuss the options available in your market today.

Listing in the Winter Attracts More Serious Buyers

Listing in the Winter Attracts More Serious Buyers

A recent study of more than 7 million home sales over the past four years revealed that the season in which a home is listed may be able to shed some light on the likelihood that the home will sell for more than asking price, as well as how quickly the sale will close.

It’s no surprise that listing a home for sale during the spring saw the largest return, as the spring is traditionally the busiest season for real estate. What is surprising, though, is that listing during the winter came in second!

“Among spring listings, 18.7 percent of homes fetched above asking, with winter listings not far behind at 17.5 percent. While 48.0 percent of homes listed in spring sold within 30 days, 46.2 percent of homes in winter did the same.”

The study goes on to say that:

“Buyers [in the winter] often need to move, so they’re much less likely to make a lowball offer and they’ll often want to close quickly — two things that can make the sale much smoother.” 

Bottom Line

If you are debating listing your home for sale in 2017, keep in mind that the spring is when most other homeowners will decide to list their homes as well. Listing your home this winter will ensure that you have the best exposure to the serious buyers who are out looking now!

The study used the astronomical seasons to determine which season the listing date fell into (Winter: Dec. 21 – Mar. 20; Spring: Mar. 21 – June 20; Summer: June 21 – Sept 21; Autumn: Sept 21 – Dec. 20).

Homeownership Offers Stability & Wealth Creation

Homeownership Offers Stability & Wealth Creation

The most recent Housing Pulse Survey released by the National Association of Realtors revealed that the two major reasons Americans prefer owning their own home instead of renting are:

  1. They want the opportunity to build equity.
  2. They want a stable and safe environment.

Building Equity

In a recent article by The Mortgage Reports, they report that “buying and owning a home is the essence of ‘The American Dream.’ Each month, your housing payments go toward owning your home instead of renting it; building your personal wealth and assets instead of someone else’s.

History has shown that homeownership is a clear path to wealth-building, with homeowners boasting a net worth [that is] multiples higher than the net worth of renters.”  

Family Stability 

Does owning your home really create a more stable environment for your family?

survey of property managers conducted by rent.com disclosed two reasons tenants should feel less stable with their housing situation:

  • 68% of property managers predict that rental rates will continue to rise in the next year by an average of 8%.
  • 53% of property managers said that they were more likely to bring in a new tenant at a higher rate than to negotiate and renew a lease with a current tenant they already know.

We can see from these survey results that renting will provide anything but a stable environment in the near future.

Bottom Line

Homeowners enjoy a more stable environment, and at the same time are given the opportunity to build their family’s net worth.

Avoiding Bad Trends when Updating your House


There has never been a time in history where trends could spread quicker. Trends involving updating a house are no different. Not long ago you would have to go over to someone's house in order to see what they've done. But not today. Whether you are on Facebook and seeing updates on your friends DIY projects or you have been scrolling through Pinterest ideas, seeing unique home improvements has never been easier. If a lady in Albuquerque paints her ceiling red and pins it on Pinterest, one month later that could have inspired thousands of ceilings to get painted red across the world. That could have never happened a decade ago.

With so many ideas out there you need to be careful not to turn a "home-improvement" into an eye sore down the road. 

As they say "Easy Come, Easy Go". If something gains popularity really quickly you can almost bet it will loose popularity quickly too. Shag carpet in earth-tone colors like gold and green wasn't heard of in early 1960's but in the 70's it had become the floor covering of choice. And then only a decade later it was gone again. 

Let's look at today's trends. What kind of styles are going as quickly as they came? 


Bypass Vintage Spoked Sliding Barn Door Closet by TheWhiteShanty: Barn Doors and barn wood everywhere. The trend probably started because old tumbled over barns needed to be put to use and someone got crafty and re-purposed it to make picture frames and shelves. Now you can buy Faux Barn Wood Furniture. They have even created vaulted ceilings out of barn wood and corrugated metal.  Can you imagine looking back on that and cringing?

Beautiful cobalt blue vessel sink....It needs a different faucet, etc., however.  Houzz ᘡղbᘠ: Unusual Sinks. It's not hard to imagine these going out of style quickly. Every design of these glass bowls are very style specific. And a small percentage of people would like the color and pattern than if it was a regular sink. Future buyers just might not be able to imagine that bathroom being their own.

House of Turquoise: Colordrunk Designs  (Would LOVE to try this tile in a bathroom!): Chevron. This pattern got a ton of attention very quickly and could be found on every skirt, baby blanket, and book cover. But should it belong in the house? Especially paired with a trendy color, you can bet on the year this backsplash was installed, 2013. It has only been 3 years and it is dated.

Tax Advantages of Owning Real Estate


Home-ownership comes with many perks. One advantage is a little bit of tax relief. You would be spending this money whether or not you owned a home because all expenses are built into the price of rent, however, a homeowner can deduct them!

Mortgage Interest Deductions: During the first years of a mortgage, most of the payment is going towards interest and only a small amount goes towards principal. For homeowners, all the interest is tax deductible. On a $100,000 30yr-loan at 4.25%, $4,200 goes towards interest in the first year. All $4,200 is deductible. This is the same for home-improvement loan interest!

Property Taxes: Property taxes are another expense homeowners have that are tax deductible.

Energy Efficiency Tax Credit: This is due to expire at the end of this year. But if you have made your home more energy efficient, you can get a tax credit of $500!

PMI: If you don’t have at least 20% paid down on your house you will be paying Private Mortgage Insurance. This is also deductible but only if you make less than $109,000 a year.

Depreciation: If you are renting out a house you can deduct the depreciation value of the house. The recovery period for a rental house is 27.5 years.  To calculate what you could deduct use this calculator. Make sure to set the recovery period to 27.5 years.

This information is for awareness only. I am not a tax adviser. All information given here has been abbreviated from Marketwatch.com. Consult a tax expert to fully take advantage of all home-ownership tax breaks.

Where does SD rank for best retirement state? You’ll be surprised!

It ranks #5! 

According to kiplinger.com our beloved South Dakota is ranked in the top for retirement friendly states. Their reasons are as follows:

  1. There is no state income tax so Social Security benefits and other retirement income are not taxed.
  2. Cost of living is low.
  3. Percentage of the population over 65 is above the national average with 14.5%
  4. Sales tax is relatively low.
  5. SD offers many home-owner benefits for Seniors including tax freezes, property tax reduction, and property tax homestead exemptions. Property Tax homestead exemption is for homeowners 70 or order or a surviving spouse. This allows them to delay paying property payment until the sale of the property.
  6. There are no inheritance and estate taxes.

The only states that rank better than SD for retirement are Delaware, Florida, West Virginia and Pennsylvania.

Our neighbors, Nebraska and Minnesota, are among the worst states for retirees along with North Carolina, New York, New Mexico, California, & District of Columbia.

So why not move all your older relatives to the wonderful state of South Dakota!

Click here to see the full report and how every state ranks.

Fixer Uppers — Is it a Good Deal or a Money Pit?

If you have been browsing through houses online and you found an under priced house that is a fixer-upper, you might have found a bargain! The other reality is that it could be a money pit.

Here are some questions to figure out before making an offer:

  1. Is it just ugly? or does it have bigger problems?  Old carpet, cat urine smell, ripping wallpaper, chipping paint, no problem! Not to say that it will be cheap to replace carpet and paint but it is a cost that you can easily calculate and decide if it is worth it. You can get a really good deal on a nice house if you are willing to use some elbow grease.
    Leaking roof, missing siding, broken furnace, missing plumbing? Now this is a problem. This is not a property to jump on. Take your time. You will need to get estimates to fix each of the issues. And plan for it being twice as expensive. If you believe its still worth it, then go for it. But don’t expect to be able to move in quickly!
  2. Always stay in your comfort zone. This isn’t usual advice but when it involves this much risk you need to know what you can handle. If you aren’t comfortable with a deal it is likely that you aren’t understanding everything that it will involve. And a miscalculation can be very very spendy!
  3. Have the money to spend. Make sure that you have your finances in order. If you can barely make the down payment, how will you afford the repairs? If you can’t move in until the repairs are done, you will be paying insurance, utilities, and interest on a property that you aren’t living in. If you are going to be taking a risk, make sure you can handle your worst case scenarios.
  4. Have a backup plan. In the worst of cases what will you do? Your Plan-B doesn’t have to be spectacular, make you money, or be convenient; but you should have one! Can you easily resell the property as-is for what you paid? Can you live in the house before repairs are made? Just as long as your plan isn’t to skip town and let the home be foreclosed on!

    If you need my assistance please don’t hesitate to call, Angie Uttecht 605-350-2553

How will Student Loans affect the Housing Market?

Here are some statistics to think about.

  • The average graduate of the class of 2015 has $35,000 in student loan debt.
  • Since 2010, 40% of households under 35 had a student loan.
  • The average American household with at least one credit card has nearly $15,950 in credit-card debt (in 2012), according to CreditCards.com, and the average interest rate runs in the mid- to high teens at any given time.

When a lender looks at debt, they see it all the same. A $260/month student loan payment is looked at in the same light as credit card debt or a car payment. If someone has all three debts, getting a mortgage can be a very difficult task.

Because of this increase in debt, for the first time ever, young people who did not seek a college education are more likely to buy homes than their college educated peers.

This is bad news for all homeowners looking to sell a home. If there are less young people who are looking to buy small and inexpensive homes, it will be harder for those trying to sell to move up. The ripple effect continues as those selling medium priced houses will have less potential buyers because they are stuck in their entry-level homes.

The twist? According to NAR, 88% of Millennials home purchases have been for houses over $100,000. And 45% of Millennials pay over $250,000 for their first home.


Weird and Cheap Kitchen updates that you can do yourself!

If you have an outdated house, (or are interested in buying a house that is outdated) good news! Here are a lot of cheap ideas that will transform your living area!

1. The Magic of Paint
Of course, fresh paint on the walls is always a great update. But did you know you can paint ugly cabinets and counter-tops too? The only change in the picture below is paint. Pretty huge change! Follow this link for instructions. 






2. Concrete

How does concrete fit into a kitchen? Better than you would think? If painting the counter-tops isn’t your thing or you want stone but can’t afford it, this is for you! Concrete counter-tops are durable. You can stain it to look like marble, granite, wood, versatile, and best yet, cheap!   Learn how to do this yourself. 















3. Upgrade all your appliances for $50? It isn’t impossible. If you desire a stainless steel look, you can buy stainless steel contact sheets. Applying this to your appliances will really change the appearance of your kitchen! Read more Here!

Or you can paint it with Rust-oleum Stainless steel paint. Read more here!

If you were to get new counter-tops, cabinets, and appliances, you would be spending thousands of dollars, and very easily could be worth it. But these cheap tricks look at least 70% as good and cost only 5% as much!