A Few Bright Spots

There was a good comment today on my last blog article about doing what you do best and staying positive. Those are definitely good recommendations, and we should all try to focus on the positive things going on around us.

As many of you may already know, we also own the websites at LakehomesUSA.com, RiverhomesUSA.com, and OceanhomesUSA.com. In doing so, we communicate each day with real estate agents and brokers across the country. Recently, although sporadic, I'm starting to hear more comments about good things going on in various markets, and that tends to shine a brighter light on days ahead.

Just in the last week, I've had positive comments from agents regarding their markets in California, Alabama, New Jersey, Florida and Mississippi. It's not all rosy out there, but there seems to be some sense of doom and gloom subsiding a bit.

We've also had a few more buyers contacting us recently, and in Minnesota you can't complain about that this time of year. See, I'm already in a better mood.

I spend a lot of time these days sitting at my desk and running this company, so it might be good for me to get outside a little more often. If any of you would like the company of an experienced lakeshore specialist in your search for just the right lake place, give me a call or email and we can get to work on it right away!

Dan

Heading For 2009

You may notice a slightly different look to our website today. Over the coming months we plan to bring Lakehomes.com to a new level of design and format, and the logo seemed to be a good first step.

You've probably also seen a few video camera graphics popping up to the side of some of our listings, which will make it easier for long distance buyers to get a better perspective of a property before they make a trip to see it. More and more of these will be available in the days ahead.

As the new logo points out, Lakehomes.com has been around since 1996 - longer than any other waterfront website. It is based on the simple concept the "Specialized Agents" can do a more productive job in guiding waterfront buyers and sellers to their desired goal. And with the Lakehomes.com name behind them, our agents have some of the best resources available in Internet marketing and expert knowledge to make sure their clients are getting the exposure and guidance they deserve.

The real estate business has changed immensely over the past twenty years, when I first started my career. The days of sending an ad for a new listing into the newspaper several days in advance, have now been replaced by immediate and thorough exposure for those properties on niche websites such as ours.

As a seller, it is probably more confusing than ever to try and figure out what types of online - or offline - marketing may work best. And with the slowdown in the economy, the decisions you make may be more important than ever.

I have had a lot of calls lately from prospective sellers asking me what kinds of things we can do - or they can do - to attract a buyer to their home or property. The most honest answer I can give is, "I'm not sure." Having great exposure is no doubt a big part in getting buyers to find you, but there will be many other factors that come into play on each particular property...and the expertise of the agent you choose to work with is a huge one.

It has been our goal for many years to provide a deeper value to Lakehomes.com than just as a website to find properties. The site - and the agents you see on it - are an extension of the waterfront niche that we built long before our competitors came around. And from personally working with thousands of lakeshore buyers and sellers throughout the years, we have a pretty good sense of what is important to them, in general.

The next stage of Lakehomes.com will be different from the past. I firmly believe the real estate industry will need to re-tool along with the automakers if they are to come out of this downturn in decent shape. Many brokers have continued to hang on to antiquated methods of doing business, and I don't plan to be in that camp.

So it is now time to move ahead with new ideas. Many of those are in my head, and I'll release them to the website now and then. But the real change will be the philosophy on how the business operates to benefit the consumer the most...far beyond changes in design or added features.

The one thing I'm sure of is that you will see a lot more of Lakehomes.com soon. And...you will see a lot more waterfront real estate sold because of it!

A New Focus to this Blog

My dad was a math teacher for more than thirty years. I always thought it would be a terrible job trying to create new and interesting subject material each day from a basic foundation that really doesn't change. He was a great teacher, but I think he got a little bored near the end of his career.

There were a lot of other teachers I knew who also seemed like they had lost interest in new ideas as the years wore on them. Some would not even let their students have copies of the tests that they took, because they would surely get passed around and it would be extra work to think up new questions for the following year.

It certainly isn't just teachers that go through these stages during their tenure, but it may be easier to recognize since they tend to focus on a single main subject...from the time they enter their profession until the end of it.

Sadly, many of those intelligent people - who were very motivated when they began their careers - got tired. And that is pretty much the same thing that happens to any of us in time, unless we change our focus now and then.

As much as I enjoy writing about my experiences with lake property and the real estate market in general, the writing style becomes a little stale after awhile. Once that happens, I become less interested in providing new information, and you have less interest in reading it.

You may have already noticed that a lot of my earlier articles provided a reasonable amount of experiential knowledge on what types of things to keep an eye out for when buying or selling lake property. If you haven't read them already, you can easily look back at those jottings to get some insight into my two decades of work in this niche. Several people have mentioned to me how valuable some of that information was to them, and it made them think differently on how to approach the market either as a seller or a buyer.

However, as the 2008 market wained, it got a bit repetitious to think of new ways to talk about a limited bucket of items, like the difference in values between sandy shoreline or the mucky variety. So I started spewing my personal thoughts on several things tied to the economic doldrums. After all, I think blogs should be a direct flow of one's own beliefs from the brain to the keyboard...even if it is off the subject a bit.

Now, as we turn to the last page of the current calendar, I'm also getting tired of this subject. I've seen enough news reports on deflation and bailouts to sicken me for quite some time. So, I'm searching for a new slant to this blog! I'll happily accept recommendations, so if you have some ideas just throw them my way.

But until I get zapped with enthusiasm from some type of turnaround - or at least a teeny little glow at the end of the tunnel - I'm going to look around for subject matter from a few of my colleagues across the country. Maybe with less of a focus entirely on waterfront property, but ideas and successes that seem to be working for people in other areas who are attempting to play the real estate game during in this dreary climate.

So let's quit focusing on the bad news (like the Dow dropping almost 700 points today), and instead turn to all the positive things going on in the world of real estate. If nothing else, it will keep me pretty busy trying to dig some up! And if it helps a few of my readers with their 2009 real estate plans, I did my job.

Dan

Living In The Moment

They say that time passes us by if we don't "live in the moment." We miss out on all the beautiful things around us by always looking ahead. And later we look back on memories that we wish we would have spent more time enjoying when they were taking place.

Most all of us do it. We are excited to get on with the next stage of our lives, whether it is an upcoming wedding, a new car, a creative marketing campaign, or next month's vacation. But whatever that next big event is on our calendar or in our mind, we pass up opportunities to take advantage of the little things that can truly make us happy.

I believe there is also a variation of this "living in the moment" philosophy called "getting caught up in the moment," but not in the sense of just an isolated event. It could be that a great majority of the American public is now caught up in the moment of how bad the economy is...or seems to be. And this is pretty much just the opposite of its cousin: "living in the moment," because it won't let people move ahead - or even think about moving ahead.

It is no doubt true that there is a wide array of financial difficulties tied to this economic downturn. Financing is more difficult, and equity has been eaten up rather quickly. But there is still a lot of capital available, and we are seeing more cash sales than we used to.

No matter what situation we are in, there is always a group of people that look beyond the news stations and the barrage of negative reports, and just charge ahead. They don't do it carelessly or haphazardly, but there seems to be another driving force of self confidence involved that gives them comfort in making forward-thinking decisions that others wouldn't risk.

Everyone knows these types of people. Nothing bad really ever seems to stick to them, and they tend to be genuinely happy. Whereas, those who constantly worry about the terrible things that might happen today or next week - or the fact that their 401K has lost 27% of its value and may never come back - cannot pull themselves out this self-perpetuating rut of scarry thinking.

Obviously, real estate has become a large part of this worry. Those who can't seem to sell their homes are worried that the real estate value they perceived as rock solid may never come back, and they don't have enough equity left to even move on with their lives. These are real worries, and there are no great answers to that problem currently. Sellers in this position need to use every resource possible to figure out how to get the best exposure for their properties, and to make them as appealing as they can.

On the other end of the rope are the buyers that would never think of venturing into this imaginary vortex called the real estate market, where they might get swept away in a whirlwind of shrinking values. It's true that something like that might happen, but it's also true that I might get home tonight and find Martians have taken over my house and made "Ollie the Dog" their leader. We just don't know what the future holds, and that is what makes life so interesting.

If we are too petrified to take chances and are unable to consider what types of positive experiences may await us if we do, then we are simply "caught up in the moment." And we will pass by those opportunities, leaving others to take advantage of them instead. Only to later say, "Boy, were they lucky to buy that when they did! I can't believe the price they got that for!...blah, blah, blah, blah, blah!"

That is what is happening with real estate sales right now. Home prices in many areas are similar to prices from 2004, and some buyers who are peering into the future are seeing happy times at their new lake cabin or the enjoyment of an upgraded home they could never have afforded in the past. For many of them, the crystal ball is showing visions of instant equity as soon as this market turns around. They know that buying anything at the bottom is a matter of luck, and they are convinced that we are close enough.

Since most people purchase waterfront properties for reasonably long-term enjoyment, buyers in this category are assuming a little bit of risk while increasing their "utils of satisfaction." They don't need immediate gratification from all ends; instead they look to a steadily increasing level of enjoyment - both in new experiences with family and friends...and most likely in real estate value in the not too distant future.

To make this even more exciting for waterfront and recreational buyers, prices and availability for lake properties and large parcels of raw land are pretty impressive. In the two decades I've been in this business, I don't think I've seen such a wide selection of good vacation properties for sale. Not only are values low compared to construction costs, but there are plenty of choice properties that you would never have seen hit the open market in past years.

So try not to get too caught up in all the bad news. If the Dow keeps going down 400 points each day, we only have about 20 of them to go anyway. You probably won't even be able to close before then!

And if it doesn't keeping dropping, you'll have plenty of time to "live in the moment" at your new lake home.

Dan

Shhh! Did You Hear That?

As I was driving somewhere today, I heard a voice come out of the radio about housing sales being up about 2% in September. Now they really didn't say if they were up from August, or up from September last year, but at least they were supposedly up from something!

While I continued to cruise along thinking about how great this was, and imagining SOLD riders springing up on For Sale signs faster than buyers could gas up their cars, I switched radio stations and heard another voice mentioning that home values are at the same level that they were in September of 2004. And someone told me last week that they heard this whole housing thing was supposed to pick up in the 3rd quarter of 2023.

In just five or ten minutes of watching CNBC or FNN, you will get a similar array of stupidity from an endless parade of experts regarding the stock market and the financial mess. The political process is worse yet, with hour long debates from a cast of characters about "Joe the Plumber!"

Jon Stewart, of The Daily Show, may have done the best job on this nonsense with his bit piece this evening on political analysts called: "Who the "BLEEP" is This Guy?"

It seems to me that the rate of consumer indecision correlates directly to the number of analysts spewing out garbage at any given point in time. In fact, I may attempt to prove that in a theorem, since the real estate market is still a bit slow from what I've seen. Although, then I suppose I would have to think up a good name for it, because no one wants to go through the trouble of creating a time consuming theorem without giving it a catchy name!

Look at the Pythagorean Theorem. Now that's one catchy name for a theorem! Athough, it didn't hurt that he already had kind of a fun name as Pythagoras. Parents just seemed to be a lot more creative with names back then.

And wouldn't you know it, there's already an Anderson's Theorem. I suppose that if this real estate market picks up any more I might just have to name it Dan's Theorem to save some time. I don't think there's one of those yet.

Maybe someday analysts will get paid based on merit and how accurate they are with their prognostications, and maybe then we will be able to believe them. But until that time we will have to make political decisions, investment decisions, and real estate decisions based on incessant babble from talking heads...or on our own gut feelings.

Oh...gotta go. ABC News just called and they're having a round-table discussion tomorrow morning that includes all the people with eight letters in their last name, and how that relates to your lifetime earning capacity. Hopefully, I can get a few words in because I have some pretty strong opinions on this subject!

Here's A Thought

Well, I really wanted to get off this stock market stuff this week, but it seems to be taking center stage in our lives. Every day they tell us we lost another Trillion Dollars or so...but I'm really not sure where it went!

Maybe we are just dealing with "funny money" here. Not that it's funny how everyone is losing their retirement accounts and other supposedly safe investments, but how did we really get here? I imagine that a good part of it stems from the idea that we should be able to make a buck from someone else's actions - but it just doesn't seem to work that way.

What I'm talking about is this...

When I built my real estate business, or when the guy down the street started his hardware store, we each had to put a lot of money, time and hard work into making a profit. There were no guarantees other than looking at similar businesses that seemed to be making money, and trying to run our businesses as well - or better - than they were running theirs.

If we did have some extra money at the end of the month, we generally put it back into our business in the form or advertising, capital improvements, or other investments that we thought would help us grow - and sometimes we needed to borrow money to accomplish these same things - but if we were to succeed or fail, it would be our doing. We firmly believed that no one could make us more money that we could make ourselves!

Somewhere along the line things got a little bit blurred. Instead of people wanting to start businesses and build them from scratch - mutual funds, stocks and all kinds of fancy investment vehicles began offering returns that were out of sight. What sense did it make to work 20 hour days to create a successful company when you could just invest in one (or several through a spectacular fund) that paid back 50%, or more, on returns last year? Why not let someone else do all the work?

That is what a lot of people did. And many of the whiz-kids who were handling once-safe retirement accounts decided to do that too!

Hedge fund managers and others in high finance made tens of millions, if not billions, managing all this easy money. But everyone kind of forgot what the money was for.

The reason the money was even there in the first place was to invest in little companies (like yours and mine) that grew to be bigger companies over time because of our hard work. We may have brought in an investor or two during our early years who truly believed in our vision and wanted to be a part of our growth. But as we got bigger, most investors didn't even know what our vision was anymore...however, they were sure that the money manager they put their $50,000 nest egg with understood it completely.

And, of course, now that we worked and worked to get our little businesses to a level that might sustain our kids' college educations and our retirement, our little businesses are having a hard time making money because no one has anymore to spend. All the people who invested in the big companies - hoping to create their own nest eggs for college and retirement - have an egg or two missing. And the nest, itself, is getting a bit tattered.

It might not have been a bad idea for the government to hand out $100,000 loans last week to the little guys and gals who would build their own businesses from scratch, instead of throwing $700 Billion into the "abyss" like they did. That would have been enough to get about 7 million motivated people up and running...and in control of their own destiny!

All's Fine Now!

Well, now that the bailout bill has passed, we should be heading full steam ahead. Although, I think I noticed a slight blip in that based on the Dow yesterday.

Back when I was doing a lot of stock trading in the late 90s, I remember how common it was to see the market drop instead of going up on good news. Not that the bailout is all "good news" for everyone, but many of those in high finance have been touting it as such. The reality is that, because it has been talked about for so long, it has already been factored into the market - and the stock market has become more of a knee jerk index based on immediately released news.

However, my specialty is real estate instead of stocks, so I'll try to stick with that from now on. The funny thing here is that our sales have seemed to be stronger during the past month than they have been for most of the year. Either people are just getting sick and tired of letting the bad economic news kick them around...or maybe we are in the beginning of a recovery.

Let's let the pundits battle back and forth on the news networks, while we quietly start getting the real estate market moving again without them noticing.

Dan

So, What's Next?

As we all wait for the big "bailout" decision on whether the markets are going to come tumbling down - or if life is going to be filled with nothing but sunny days ahead (I suppose that won't help global warming) - people keep asking me, "What is this going to mean for the real estate business?" My answer is generally something like: "I don't know." But secretly I find myself thinking more like: "I don't really care!"

It's not that I don't care about the economy being strong and people being able to afford houses and other necessities; I'm in that same bunch of people, and my income is certainly dependent on home buyers being able to get loans. But it seems that every time the government tries to fix something, they make something else worse.

Now, as I've said before, I'm not an economist. I really don't know how all this works. But I've been in the real estate business for a long time, and from what I remember the economy seemed a little more stable when interest rates were a few points higher. It might not have been quite as easy for home buyers or for businesses to borrow money, but they also may have been a little more cautious when they did do it.

As the Fed has gotten more involved in easing the availability of credit to give the impression of strong economic growth, we have seen a run-up in real estate values like never before. I have been of the opinion for quite a few years that there was no way to sustain this "false real estate market" that was built on "feel good" interest rates. So, I believe that we got what we paid for...or, perhaps, what we didn't pay for!

Sellers also bought into this feel good atmosphere by thinking that these good times were never going to end. Those who used to be happy with 5% appreciation on their homes each year later decided that even 20% yearly appreciation wasn't enough, because money was cheap and everyone wanted more real estate. Home prices got out of hand, and the ocean of buyers turned into a wading pool.

This is the part of a Free Market Economy that is still totally free. Buyers are free to buy; sellers are free to sell; and real estate prices are free to fluctuate based on supply and demand - without government interference. And that is what they have done...coming down to levels we have not seen in several years.

So let's let the chips fall where they may, and maybe we can all get back to normal again. Whatever that may be!

I'm guessing there will be some kind of bailout plan that gets approved fairly soon, and some of those big exec's will only get 10 or 20 million dollars instead of 50 million for their severance packages. And with savings like that, it should only take about 20 or 30 thousand of those kind of salary reductions to make up the 700 billion dollars we need. Or, they could just get 70 million of us little guys to throw in $10,000 each.

I guess they should have called me in on that big meeting at the White House yesterday.

Dan

WOW...What About the Dow!

In real estate, the stock market can have a huge effect on peoples' motivations. I remember being out with a buyer after one of those big drops in the late 1990s. The lake home we were looking at was around $400,000, and he told me he had "just lost one of those in the last few weeks."

Of course he meant he had lost that much money, but it was obvious that a cabin of that price would not have gone to zero value like the stock did. So he was looking for better places to park his money, and he figured lake property was probably the best place at the time.

Over the past few days, we have had several calls come into our agents from potential buyers saying the same types of things: "I'm getting slammed in the stock market, so I want something tangible that I can hold onto for a long term investment." And as far as real estate goes, waterfront property and acreage is probably about as good as it gets for an investment.

I know there have been plenty of people who have been hurt financially throughout these past couple of years (many Realtors included), not only with the downturn in real estate values, but also with the high cost of goods that has eaten into their discretionary income. Many of these folks are not able to even think about buying anything like real estate right now. However, there are still a lot of people holding onto a pile of cash, and those might be the ones who will get this market moving again. With prices so low, they are probably thinking that these types of properties might be one of the safest places to be, even if the economy gets worse.

Whether the Dow goes up 400 points a day, or down 500 points, there is a lot of uneasiness in the economy right now. So unless you're a day trader, maybe real estate and especially a lake cabin - isn't a bad idea for the long term. And it's a lot prettier to look at than a stock certificate!

This Year's Market

Last night I had a request for information on how the lakeshore market turned out this year. Of course, it isn't over yet, but generally we would start seeing a reduction in sales about now.

The odd thing this year is that we've had an increase in sales all of a sudden. I remember a market like this in 2001, where not much sold throughout the summer, only to have a real influx of sales in the fall. I don't really remember what waterfront real estate prices were like overall that year (they certainly were cheaper than what they are now), but what probably happened is similar to what has gone on this year.

In a normal market, the buyers start to emerge in early spring and get excited about the thought of having a new lake place. Time is of the essence, because summer is short and most people aren't very good about delayed gratification. So they buy fairly quickly, understanding that more properties might be coming on the market - but the loss of not having it to use is greater than the gain of maybe finding the perfect one sometime.

It's no secret that the last couple of years has been tough on the real estate industry overall. The uneasy feeling in the economy, combined with the difficulty in getting loans, the high price of gas, and the run-up of real estate prices a few years ago, made a lot of people step back and think a bit before jumping into any more things they don't absolutely need.

I'm going to try harder to answer this question in another month or so, but what I kind of see happening now is that we have bottomed out (for some time now), and we are just waiting for a little bounce. That bounce may come from investors who understand that prices for lake homes and cabins are very low in relation to other goods, or it may come from the ever-expanding base of Baby Boomers who decide it's time to make a move.

Either way, most agents around the country tell me that their sales have picked up over the last month - and we are seeing that too.

A New Blog Format

After quite a few months of being the headliner on this blog, I thought it was only fair to bring Sandy in on it. She may not be as interested in writing the articles (although you can probably tell I haven't been that interested over the summer either), but she certainly knows the business and might decide to throw a few important thoughts your way.

Anyway, it is now "our" blog, so please let us know if you have any items you want us to cover. I personally think it is easier to keep the entries a bit shorter so that we can keep current information coming at you more often. At least we'll do our best!

Thanks for visiting,

Dan

Summer Fun...Then and Now

Having a lake cabin can be an enjoyable experience for a multitude of reasons. It is a great place to unwind and forget about the daily grind, and it can bring family and friends together in ways that are difficult to do off the water. And although many cabins offer plenty of recreational activities throughout the year, summers tend be foremost on buyers' minds as they set off on their cabin searches.

Those of us who grew up around water most likely have fond memories of lazy hot summer days by the lake. And visits to Grandma and Grandpa's old lake cabin with the expansive sand beach are just about impossible to erase from your memory. Besides...who would want to?

These days, summers at the lake look a bit different than they did 30, 40 or 50 years ago. Instead of the old maroon 35 horsepower Johnson motor, water skiers are being towed by outboards as big as Volkswagens - or inboards with more power than locomotives. Fishermen, who could be seen spending quiet evenings in their tiny fishing boats in search of a walleye or two, are now found with much larger rigs filled with advanced equipment to make the trip quicker and much more efficient. And the real serious ones can be seen zipping across the water at 70-80 miles per hour in shimmering bass boats on their way to the nearest gas pump!

There are still a few of the old timers around who are holding onto the past with their 12 or 14 foot Lunds. But, it can sometimes be a daunting challenge dodging 3-passenger jet skis sending text messages while jumping wakes, 20-passenger pontoon boats pulling wake boarders, and a lake full of fair weather fishermen ready to swoop down on your favorite fishing hole as soon as they see you pull one in. Consequently, most of them have given in to technology, speed, and a bit safer environment...to help fight the battle.

Back at the shore things look a bit different, too. Grandma and Grandpa's cabin with that great sand beach is now a townhouse development. Now, twenty families are living their summer dreams and making their own memories where you spent long summer days exploring and searching for lost treasures. Back then you might not hear another voice for hours - and nobody really worried about you too much because you always seemed to make it back to the cabin...sooner or later.

Fortunately, Minnesota and Wisconsin have an abundance of lakes that can provide enjoyment for lake lovers on each end of the spectrum. Smaller lakes with sparkling sand beaches can still be found across both states, and many of them have very little boating traffic to erode the serenity. Quite a few of these lakes tend to have larger parcels that give a bit more privacy than their larger counterparts.

On the larger lakes you might find a bit more traffic than you would in years past, and many of the large properties have disappeared in favor of denser development. But Minnesota and Wisconsin residents love their lakes, it is not surprising that the demand has been changing the waterfront landscape for many years now.

It seems like a lot of potential lakeshore buyers try to replicate those memories from their youth as they begin their quest for the perfect lake property. But times have changed along the water, so make the most of what is out there to experience today...and let the past go! I think you'll find that there is still plenty to enjoy when you have a lake place.

For more information about lake properties throughout Minnesota and Western Wisconsin, you can contact Dan Anderson at 888-346-5253, or you will find him at Lakehomes.com and LakehomesMinnesota.com.

Fire and Water

When it comes to lake living, I don't believe there is anything more relaxing than an evening campfire at the water's edge. I've had two lake homes with lakeside fire pits, and it is the perfect way to wind down with family and friends after a tough day on the lake. And if you have a light breeze most of the bugs seem to disappear with the lapping water, unlike those permanent mosquitoes that congregate deeper into the yard.

You can create a fire pit from plenty of materials. They sell cute fire rings with cutouts of numerous animals and wildlife scenes for hundreds of dollars. But sawing off the end of an old culvert or gathering enough rocks to complete a 3 to 5 foot circle is free!

When you are designing your lakefront campfire area, make sure not to make the circumference too large. Even though it might be easier to throw larger uncut trees and branches into these monster pits, large fire rings can make it difficult to include everyone in the conversation that seems to naturally take place around the mesmerizing flames. If you need to burn a large amount of brush and other materials once in awhile, that is sometimes better accomplished in an open area on the property where you don't have to worry about tall flames catching trees or dry grass on fire.

Also consider the area around your waterfront fire pit to make sure you are not too close to overhanging branches, and that you have a non-flammable base around the ring to keep errant coals from igniting docks, decks, trees and other items that are better looking unburned. It is a good idea to have chairs or benches made from materials that do not conduct much heat, and if possible have plenty of room to move them closer or further from the flames depending on the amount of heat being generated.

Finally, have a stack of dry wood on hand so that you can get the fire going on short notice without a lot of smoke. At the lake the end of the day happens quickly, and you might want to transition from swimming, skiing or fishing to the warmth of the campfire at dusk to relive the day's activities.

But make sure you don't drink to much as you discuss the vast array of important world topics. Otherwise, you might have a hard time remembering all the great conversation!

Selling Your Lake Lot

Now that the mosquitoes are out in full swing, it is a good time to recognize some of the pitfalls of offering bare property for sale. I was at a couple of lake lots last week...but I wasn't there for long! Even with long clothes on, I was full of bug bites in just a few minutes.

Lots, in general, tend to be less cared for than the land is around a home or cabin that is used on a regular basis. It is much easier to pull the mower out of the shed or garage and knock down most of the tall grass once in awhile when it is already at the property. With bare lots it is an extra hassle to bring the mower or trimmer out to the land to take care of that, and who really wants to go out there anyway?

However, if you are trying to sell your lake lot, you might want to look at it from the buyer's perspective. Every negative aspect they encounter is another reason to not look any further. And just like in house shopping, most buyers have very little imagination when it comes to seeing beyond what is there.

I see many of the same problems when it comes to marketing lake lots. Here are some that I would suggest trying to overcome to make your lot as attractive as possible:

1. Clean Out The Brush - Many lake lots are too grown over and it is difficult for buyers to walk through the land, let alone see what is there. Make it easy for buyers to get from the driveway to the lake - and to be able to walk around down by the water.
2. Get Rid of Dead Trees - Dead trees all over a property are a clear-cut negative that a buyer sees as not only ugly, but also expensive if they have to do the removal. It is best to get them out of there before you offer the property for sale.
3. Get Rid of Downfall - I've been to lots where there are so many trees fallen down it is nearly impossible to get through the land. This is not supposed to be a hunting excursion for these potential buyers; they are looking for a place to build a home. Help them out by not giving them a heart attack climbing over walls of downed trees. Remember that many of these potential buyers tend to be older, and this is not a good way to get them interested in your property.
4. Create Views of the Water - If they can't see the water easily, they probably won't be interested. Most counties and DNR regulations allow you to thin trees within a certain distance back from the water. Take advantage of that to make your property more appealing.
5. Don't Forget the Dock! - One of the most important things you can do - that is hardly ever done - is to place some sort of dock on the property to get buyers out over the water. It doesn't have to be fancy, but by picking up a dock section for a few hundred dollars you might make yourself several thousand with a successful sale. Lake properties are high priced because they are on the lake...don't forget to use as much of that aspect as possible in your presentation.
6. Finally...De-bug All You Can! - Mowing, trimming, spraying, and whatever else you can do to keep the bugs down will make the buyer's time at your property much more pleasant. If they have to run away before they get carried away, they probably won't be returning anytime soon. Your real estate agent's job is to get them to the property; your job is to get them to stay there!

The Best Place To Build A Cabin...

I am often asked where the most affordable lakeshore properties are in Minnesota - and which are the best lakes. That really depends on what you are looking for in a lake, and the answer would be very subjective. But this article from Minnesota Monthly uses an array of criteria - along with affordability - when they talk about Rainy Lake being the best place to build a cabin.

Minnesota has one of the largest variations of lakes in the United States. With nearly 15,000 of them, you can find waterfront real estate on everything from large puddles to vast water bodies that feel like small oceans. Lake of the Woods, Red Lake and Mille Lacs Lake all share these expansive panoramas, and they can also become quite unfriendly in fast approaching storms.

Rainy Lake - also one of the state's giants - has a bit of a different feel that provides unique rock formations and quiet little enclaves around most every bend. You often feel as if you were the first human to discover a hidden channel cut through the stone, or a concealed beach miles from civilization. It is an interesting mixture of open waters and winding inside channels that can give new perspectives to your journey each time you travel them. Here is a little tour of that waterway:

There is no doubt that Rainy Lake is one of the most beautiful water areas anywhere. With nearly 225,000 acres, 1,600 islands, and about 1,000 miles of shoreline, you can literally boat for days on various branches of this scenery-filled expanse. Just remember to get your Remote Area Border Crossing Permit, or clear in at Canadian Customs, before you venture into foreign waters.

If you are more comfortable staying on the American side of the lake, you will still have plenty of water to run on as you pass through Voyageurs National Park. Whether you are looking for a private fishing hole, a sand beach for an afternoon picnic, or a hike into a remote interior lake, it is all there to be had...without the crowds. In fact, wherever you decide to land your boat - mainland or island - it will be all yours!

But if Rainy is too limiting for you, just pull into Kettle Falls Hotel - a water-access only historic respite at the east end of Rainy Lake - and they will trailer your boat a few blocks into Namakan Lake for just $20. From there you can visit the many resorts on Lake Kabetogama or venture further east through mesmerizing Sandpoint Lake and into the remote water-based community of Crane Lake.

From Woody's Rainy Lake Resort and Pub on the west end of Rainy Lake in Ranier, you would have traveled about 70 miles or so by boat. If you haven't run out of gas money yet, you can keep going further into Lac La Croix where you can enter the Boundary Waters Canoe Area and Quetico Park to do some paddling - which will give you a few more miles to the gallon. Otherwise, just enjoy the evening at one of the lodging facilities in Crane Lake.

I hope you enjoyed this brief tour of Rainy Lake and the other Boundary Lakes, which will hopefully give you some insight into why it is such a great place to have a cabin. If you are only thinking about price, it might not be the absolute cheapest lake to buy property on; there are many other smaller lakes in Northern Minnesota that offer lower priced lots in the $100,000-$150,000 range.

But, for Rainy Lake's relatively low prices and it's unending beauty, it might just give you a whole lot more recreational satisfaction for your money than almost anywhere else. You'll never know until you check it out...and once you do you just might not leave!

Well, Here it Goes...Finally!

As the broker for Lakehomes.com Realty, I am obligated, by law, to review all the purchase agreements that come in to the office from my agents. I can tell you that I've been pretty busy over the last week. And it isn't just one or two agents - or one or two areas - it is starting to get busy across most of the state.

I've been saying for awhile now that there will be a spring market sooner or later, and I'm sure most of you were thinking I was crying "wolf!" I can't tell you how long it will last, but I've noticed some major changes this past week in how the media is now perceiving the market.

Just a month ago, nearly every news report was geared toward the sinking real estate market and all the bad things that go along with it. But the most current news stories are more focused on what good deals are out there, and how people that were priced out of the market just a couple years ago can now start buying again. Who flipped that switch?

With all this good news, I suppose that we will now go back to multiple offers on properties, with sale prices higher that what they were listed for. Well, that might be an exaggeration, but history has plenty of proof that we humans tend to act quite similar to lemmings when it comes down to good news...or bad!

I don't want to dwell on how the 2008 real estate market may or may not turn out. And I certainly won't pretend to be an expert in real estate markets across the United States - or even those other than the ones relating to waterfront properties. But based on how the phone has been ringing lately, those buyers who are in search of lakeshore homes and cabins in Minnesota and Wisconsin are definitely in the hunt.

To confirm that I wasn't just imagining the increased interest in waterfront real estate, I checked our page views on our national websites at LakehomesUSA.com, RiverhomesUSA.com and OceanhomesUSA.com. On those sites we are pushing nearly 2,000,000 page views each month, which is about double of what we were last year. Lakehomes.com, which is focused mainly on Minnesota and Western Wisconsin, has also hit record levels with nearly 1,000 visitors on the site each day viewing multiple listing pages. The waterfront buyers haven't disappeared by any means, it's just that most of them have been waiting for the right time to jump back in.

I've kind of tired from writing about the market in general, which is why I haven't been posting as often as I was. But now that sales are starting to finally take place, I will quit boring you with my day to day thoughts of how this funky real estate market may play out. No one knows - including me - so let's just sit back and watch.

While we are waiting for the results, I'll try to think up some more interesting things to entertain you with.

An Update On Lakeshore Sales

Generally, by now the spring market is starting to heat up for the year. However, this year we are having a problem with "heating up" in more ways than one!

I wrote an article a couple months ago that talked about how the weather was not always a big factor in the spring market. It basically said that when people sensed that spring was coming (sometime around the beginning of March), then they changed their habits and starting thinking about new purchases like lake cabins - or even moving to new areas. But in talking - quite often - with other seasoned agents around the state, this may be the oddest year any of us can remember.

Over the years I have noticed that the spring lakeshore real estate market can start as early as February, but might begin as late as mid-April. These are typically the buyers that have decided the time is right to make the move to either a lake home or a waterfront cabin. They see themselves moving in shortly after ice-out, and getting full use of their lake place for the lengthy Minnesota summer.

Well, I just looked at the calendar, and I believe it is May 20th. If I started to check off the months till summer ends, I could probably add them all up on one hand...and have two or three fingers left over for next year's market. It doesn't look real promising from a seller's standpoint. And in case that isn't a big enough downer, here is another taste of reality....

I thought it might be interesting to look at residential waterfront sales during a certain spring period for the past several years. Since the Twin Cities Multiple Listing Service (Northstar) is by far the largest in the state, and because it has data from nearly every county throughout Minnesota and Western Wisconsin, we should be able to get a reasonable comparison of what the waterfront market has been like year to year since 2001.

I decided to use the time frame from April 1st of each year through today's date (May 20th), since that should be right in the midst of the spring market overall. I used only residential sales; no bare lots or commercial properties. So here it goes:

2001 - 288 units
2002 - 266 units
2003 - 335 units
2004 - 414 units
2005 - 489 units (looks good so far!)
2006 - 334 units (whoops)
2007 - 278 units (double whoops)
2008 - 245 units

One more thing you should know about this is that Northstar MLS has grown quite extensively throughout most regions of Minnesota and Western Wisconsin over the last few years, causing greater numbers of unit sales to be reported each year based on listing numbers alone. That said, these numbers show even a larger drop in units if compared more accurately to the earlier years of this data.

I could go further and look at average sale prices and market times, but this should be a big enough dose of reality for tonight. The market is simply not as good as it was a few years ago. However, there is a silver lining inside this cloud that all sellers should be aware of.

Throughout the years, even in good markets, about half the homes listed do not sell. They go off the market after being listed for 3-12 months or more, only to get picked up by another brokerage...and perhaps others after that. Whether it is because of poor location, condition, marketing, or any other excuse that you might try to pin on it, it is always because of a price that is too high for that particular piece of real estate. Even if the structure was in terrible shape, the land would still be worth a certain amount that would sell in any market if priced correctly. Today's real estate market is no different.

Our company has had several waterfront sales over the last few days. There are very good and qualified buyers in the market right now who will pay reasonable prices for good lakefront properties. But, there is still an unbelievable amount of properties for sale in poor condition listed at unreal prices. If you are a serious seller, all you have to do is make sure yours stands out from the rest of the pack - both in condition and price!

Ask your agent to take you out to half a dozen listings that are similar to yours. Be as objective as you can, and try to look at your property as if you were the buyer. Which of the homes or cabins would you choose? Is yours truly the best of the bunch, at the best price?

Don't be fooled by believing that prices and sales numbers are going to immediately return to their levels from a few years ago. If you can afford to take a little bigger hit that you originally anticipated on the selling end, you will most likely make it up on your purchase if you are buying something else.

But buyers should also realize that there may never be another time where prices for homes and cabins are so inexpensive, in relation to to actual land values and building costs. Some of those smart buyers are moving back into the waterfront market, and are picking up some great properties at prices they couldn't touch a couple years ago. I personally believe that these people are buying very close to the bottom of the market, and that lakeshore values will edge up slightly - depending on the amount of unsold inventory that remains available.

And remember that the lakeshore market up north is a fairly limited one, so don't wait until the end of July to get your lake home or cabin to the top of the buyers' lists! That's normally about the time Minnesotans are more interested in getting their snowmobiles ready to go again.

Part 6 of Series..."What to Think About When Buying Lakeshore"

Part 6: Make Room for Mother...and Father

I thought that Mothers Day would be a fitting time to talk about a few of the concerns I've heard over the years, relating to space for the extra guests. Kids are generally quite easy; they can throw up a tent or sleep on the floor. But older guests many times need something a bit more comfortable than that.

When people start looking for lake cabins, many of them tend to create a picture in their minds about large gatherings of friends and family all enjoying the recreational opportunities available on and off the water. Oftentimes this does happen (unless of course you don't invite them), so if this is part of your plan you should consider things like sleeping arrangements, parking, access to the water, and even space needed to hide out on bad weather days. Of course you don't want to go overboard on these things just because you might have a party now and then, but I'll give you a few things to at least think about before you buy.

Bedroom space can be kind of a tough one. A lot of lake cabin buyers don't want to have a real big place because they already have one of those to take care of. They like the idea of having a more rustic getaway - the kind of place that feels like a cabin. That is probably the one comment I hear more than any other one.

Cabins, of course, come in all sizes. But unless they are decked out in a lot of interior wood and north woods furnishings - along with an open design that gives a more lodge-like ambiance - the larger ones can start to feel a lot more like lake homes than lake cabins. A cozy cabin with two or three bedrooms seems to fit a lot more of the buyers than the four or five-bedroom models.

Obviously, this lack of sleeping space can become an issue if you regularly have extra company, and when the parents come to visit they might like to have a little privacy. You can always do some temporary conversions like a sleeping porch, bunkhouse, or even closing off another area to create separation if you have room. Another good option is to have an extra camper or motorhome on the property to give you some added sleeping space for a lot less money than an addition. Just make sure you have a level area to park it in, otherwise you may see your guests rolling down the hill.

Steep lots can also be a problem for older guests...and for adults trying to keep an eye on younger ones. Treetop views offer great panoramas of the water below, but getting down to the beach - and back up again - can offer some challenges to the non-athletes. On some of the higher lots with more gradual slopes, there might be a path for a golf cart or four-wheeler that can make the trip up and down quite a bit more enjoyable. And it may make the difference between some of your guests being able to make it to the boat - or not - if you decide to purchase a lake place on one of these more elevated properties.

Parking is something that presents a bigger problem on some lake properties, just by the nature of how roads around lakes have been placed. Most everyone has taken a scenic drive along the lakeshore and seen how cabins are sometimes packed in against the road. Quite often there is not a lot of depth to these lots, so the only parking available off the road is in the driveway - which might only hold a couple of cars.

If the road is wide enough with ample shoulders, it might not be too big of a problem. But many roads around lakes can have a steady stream of traffic during the busier months, and because they tend to be quite narrow (often with no shoulders at all), it can create quite a problem when friends need a place to park.

Lake cabins can be a great place for solitude and to get away from the daily rush of life, but they can also bring a lot of enjoyment to you and your extended family and friends. Just make sure you will have enough space to accommodate all age groups that you envision coming out to share these good times with you.

And remember that even in Minnesota and Wisconsin, we usually get a few days that being outside can be a little miserable. Having twelve people in a two-room cabin might get a bit tight during these times...so try to think ahead.

Rock Bottom May Have Already Hit...In Some Markets

As some markets across Minnesota seem to be languishing in excessive inventories of unsold homes, along with rampant low ball offers, I am starting to get a few reports from around the state that vary from that a bit. I have a few ideas on why this might be happening.

While I was at a wedding in International Falls on Saturday, the county assessor mentioned to me that the recent sales coming through his office prove that prices are holding steady at last year's levels. Holding steady!...Hasn't the media been telling us that everything is in a downward spiral? And isn't International Falls only mentioned sporadically as one of the top relocation markets in the nation? Why would their prices be holding steady?

If we all think back to about five years ago, it seemed like real estate prices in some parts of Minnesota - and in many parts of the country - were increasing in value at an unbelievable pace. Some areas of the Twin Cities had over 20% appreciation from year to year, even higher than the adjustment in most peoples' wages. There were many supposed reasons for this rapid escalation, from the high cost of building materials to a huge shortage of labor. In fact, there were reports that gypsum may become extinct, so if you were going to have sheet rock walls, "you better get them now!"

Of course, in retrospect, all of this was silly. Just as silly as the thought of a corn field development house, in the outer rings of the Twin Cities, increasing at 21.3% in one year. I guess people thought that corn fields would become extinct, too (in fact they may have if developers would have been able to keep up that pace much longer).

But the Twin Cities wasn't the only area that prices had superb appreciation over the last decade. Waterfront properties in some of the more popular vacation areas of Minnesota and Wisconsin had their lakeshore values (just the land costs alone) increase to over $5,000 per front foot - or more - on the most sought after lakes, and not much lower on some of the secondary ones. However, there were a few markets around that didn't share as much in this free-for-all, and they might be the ones that are holding their own better than the rest.

Areas like Lake of the Woods, Rainy Lake, Grand Rapids, Park Rapids and Duluth, among others, have no shortage of spectacular recreational opportunities and beauty. However, due to certain factors, and possibly their increased distance from the Twin Cities, the prices have not escalated in those lake areas nearly as much as some others. In fact, you may have to try real hard to even spend $2,000 per front foot on some of the best lakes in those areas, even for some of the most private and attractive lots around. And many times you can throw in a pretty nice lake home or cabin for another 20-30%. Try building for $20 a square foot these days (plus a free septic, well, driveway, landscaping and garage).

There is no doubt in my mind that areas like Brainerd, Lake Vermilion and Hayward will be popular markets for lakefront real estate far into the future. They have vast amounts of water, great fishing, plenty of interesting ways to pass the time, and good proximity to Minneapolis and St. Paul. That is what caused them to become attractive vacation home markets in the first place...and what gave them their quick appreciation over other lake areas.

Only time - and some warmer weather - will tell if certain markets around Minnesota still have a little cleaning out to do. But from what I am seeing, rock bottom may have already hit in others. If that has truly happened, I would wager that the rest of them aren't too far behind!

The Changing Seasons

Most of us who live in Minnesota have always been eager to tell others how we enjoy the changing seasons. Even after a relaxing trip down south to soak up all that sunshine, our conversations seem to point toward how difficult it would be to not have the variety of temperatures and recreational opportunities throughout year. But this year the seasons are changing a little too often for me - and I'm pretty sure I'm not the only one who feels this way.

In our household, I've boxed up the winter clothes twice now and then pulled them back out again. It's not that you need heavy parkas and long underwear, but some boots and mittens are kind of a necessity with a foot of snow showing up each week...along with temperatures back down in the teens. In addition, we brought out the sandals and shorts so we could get a chance to put them on during our spring days that we also seem to get every week.

Today I'm up at Rainy Lake, and it looks pretty much the same as it does around Christmas. The trees are covered in snow and the ice on the lake is still a few feet thick. There is a little bit of open water in areas with the heavier current, but it might be a challenge to get rid of the rest of it by opening of fishing season on May 10th.

Most of the birds seem a little confused up here, not really knowing where to find food or hang out. There were several of them flying around inside Menards, probably because it was a little warmer in there and they had a pallet of bird seed ripe for the picking. I saw a group of robins using a small toy shovel to try to get down a little closer to the worms, only to find out they also needed a toy pick-axe to break through the frozen ground.

I think many of us have the same sense of confusion, not really having a good feel of what month it is or what kinds of activities we should be taking on. Generally, we'd be out raking our yards and maybe doing a little painting or other odd jobs around the house. And a lot of people would be out looking at lake cabins and waterfront homes during the spring market, so that they can move into them before the summer is over.

This definitely has been one of the longest winters I can remember, and some days it makes you wonder if it ever will end. I'm guessing it probably will, and we will have hot summer days sooner or later - just like in years past. Those of us who have lake places will still get plenty of enjoyment from our days around the water, and by fall we'll be talking about how much we enjoy the changing seasons.

So even though this weather seems to be dragging on forever, pull out a few summer photos to help you remember some of the good times that warm weather brings. And if you've been thinking about buying a place on the lake, you can still take advantage of some great values that are currently out there. You may be very glad you did!

What If You Were The Only Buyer In The Market?

What a silly question! How could that possibly happen? Is Ollie "The Dog" writing this article, too?

I've been out showing lake cabins all day today around Grand Rapids, Longville, Outing...and tomorrow I'm showing different buyers in Annandale. I know that's a pretty wide ranging area (about 200 miles from one end to the other), but I've been doing that for years. By personally seeing and understanding markets across Minnesota and Western Wisconsin, I can better help waterfront buyers (and assist my agents in helping their buyers) by giving them a perspective of the entire lakeshore market as a whole. And right now the whole market is pretty much there for the taking!

Now, I certainly don't mean that every seller is in dire straits, nor would I ever suggest that every lake property owner will even reduce their price by as much as a dollar, but I would say that prices - in general - have come back to a level that we probably won't see again for a long time. If ever.

Some properties are priced very well - according to the current market - and they will sell for prices at or close to what those sellers are asking. Others are priced too high, and may come down quite a bit to create a transaction. Some won't sell at all, and will get listed with two or three more brokers before they ever get an offer. It's really no different than it ever has been.

It's not easy to take the plunge on an investment as expensive as a lake property when the media hammers on the housing market each day. Subliminally, we are constantly receiving messages telling us to keep our wallets in our pocket because the sky is surely falling. The problem is, we just can't tell for sure when it's going to land!

If I were a potential lakeshore buyer listening to numerous news reporters each day, instead of just a Realtor who has specialized in waterfront real estate for over twenty years, I'd probably believe that the value of most real estate was going to at least zero. Why would anyone want to own anything like that? Penny stocks could be the real answer.

And what if gas goes to $10 per gallon? Who will ever go to the lake then?

One of my agents emailed me this article from Minnesota Public Radio today. It's an accurate depiction of what is going on in many areas across the country right now - and quite severely in Minnesota and Wisconsin.

I will tell you this. I do have - as many of my agents also have - very good buyers who realize that this might be a great time to purchase a lake home or cabin. Those of us who specialize in waterfront property understand the true market, and I believe our buyers will make some great purchases over the next few months because of the extraordinary hype that has gone on about the decreasing values.

By realizing that markets are cyclical, we shouldn't get too overly concerned about tomorrow's real estate news. I'm sure millions of people will see several "for sale" signs on the next "Good Morning America" broadcast, backing up the downward spiraling housing market. More agents will turn their licenses in to the state to avoid paying their ongoing dues so that they can go out and get a steady job driving truck or waiting tables. And many more buyers will put their money in 3% CDs just to have a safe investment.

But, if you take a step back and look at market trends, building costs, realistic values...and the unmeasurable family enjoyment of owning a place on the lake, you too might realize that there may never be a better time to make that purchase. However, if your only goal is to get a ridiculously low price on a property just because you might be able to do that in this market, you may not be real successful...on the good properties. However, there is always plenty of junk available out there that may warrant some hefty discounts!

Even if there were no other buyers but you out in there in the market today, there would obviously still be a limit on the minimum amount most sellers would take for their properties, just based on what they have into them and what they need to move on with the next phase of their lives. Most likey, you would do the same thing.

Obviously, you are never going to be the only buyer out there, but right now you can be one of a small number of them. There's a pretty good chance that the competition will get a little stronger quite soon!

Talk From The Dog

I'm always looking for guest articles for this blog, but I was surprised when Ollie told me he would like to submit one. Surprisingly, he has a fairly strong command of the English language. And I think he makes some very valid points on what types of things might be important to the family pet.

Hello, I've never written an article for a blog before...in fact I don't think I've ever written an article at all. But, as a dog who has been around lake properties quite a bit, I have some suggestions for those of you who might be looking for a special place for you and your pet to hang out.

When I was just a little puppy, I used to go up to my grandparents' house in Northern Minnesota on vacation. They lived on a big lake with a big dock and huge pine trees, which gave me and my uncle Charlie the Dog lots of places to hang out. The world just seemed so BIG! I had so much energy back then, and I could just roam around all day.

As I got a little older (it seems like about 7 years older every year), I liked to hang out in the house more often, and Gramma's shag carpet came in handy to keep those old bones from getting too sore. But Gramma always loved dogs - and she believed they should be at least as comfortable as humans - so she put quilts on the floor for me and Uncle Charlie so that we would sleep better. Of course, she had pretty comfortable couches also, and about the time I hit my third birthday I started spending a little more time hanging out on them - mainly to keep my bones and muscles from getting too sore after a long day of chasing squirrels and sniffing animal droppings.

Oh, I love those great memories of Gramma and Grampa's lake home. By the way, they always had really good food - and lots of it. But I digress. I wanted to tell you some things I have seen - and heard - about what other dogs like to do at the lake.

I had several dog relatives that were also around water most of the time. I'll never forget some of the stories the humans would tell about those crazy dogs at night around the fireplace. Uncle Charlie and I didn't get real involved in the conversation, but we would nod once in awhile...and maybe wag our tails.

Probably the king dog of the family was old Grandoggy Chippy. He was around when my dad was a small boy and, apparently, he loved to sail off the dock to chase sticks. He would come running down that 100 foot dock at full speed and just keep going until his belly splatted on the water. Ouch! Now I don't mind retrieving a stick from the water now and then as long as I don't have to go over my waist to get it, but you certainly won't see me taking my life in my own paws like that.

Another real "lake dog" was Ringo. He was my older dog brother, but I never got a chance to meet him in person. He lived at my parents' lake house when the kids in my family were just little. Ringo was a "frogger," and would spend hours chasing frogs along the shoreline. He was also a heck of a fisherdog, and would try to grab the fish off my brother's line as he reeled them in. I guess one day he ended up with hooks in his lip twice, so my dad got a little upset with him and wouldn't let him fish anymore for awhile.

There are plenty of other stories of the ancestral dogs of the family...Granduncle Snowy, Great Grandauntie Ginger...and many others that I could go on about. They all loved being at the lake, wandering around in the woods, laying on the shag carpet, and eating great meals. Some, like Chippy, loved to play, while others just liked to wander around the neighborhood.

I guess us dogs all have our individual traits, just like humans do. Some humans enjoy fishing or boating, and others may just like to curl up with a good book. I certainly don't mind a good boat ride now and then to get the wind blowing through my nose, but if I only had a hard floor to lie on at the end of the day I'm not sure if my time at the lake would be as enjoyable. And from talking to other dogs over the years, they seem to like the same things I do...lots of woods to roam in, no busy roads to get run over by cars, a nice clean swimming area, and plenty of shade to hide out in on those scorching summer days.

Well, thanks for listening to my story. Gramma and Grampa still have real comfortable carpets and couches - and lots of food - although they don't live at the lake anymore. But my parents now have a lake cabin they bring me to, and its the same one Gramma and Grampa used to have as their house. It's great that Uncle Charlie still comes up there to visit me, along with other dogs, and we all still partake in dog stories from days gone by. And with my fifth birthday coming up soon, I'm not sure that life can get any better!

Ollie "The Dog"

Finding The Elusive Waterfront Buyer...And What It Costs!

It's that time of year again when we will be seeing lots of for sale signs popping up all over the place. Many will be from traditional real estate companies, some will be from discount real estate companies, and still others will be For Sale By Owners. That sign - depending on the quality of it - may cost between $15 and $100 or more, but that's about the least expensive part of getting a home sold.

When considering the best, and most cost effective, method to sell your home, it may be a good idea to look at the most recent statistics from the annual survey conducted by the National Association of Realtors. Each year they compile data from thousands of responses, giving a comprehensive overview of what buyers and sellers are thinking. If you are in the decision making process on your upcoming real estate sale, it may be wise to understand the buyers' mentality as a whole.

So let's talk about the different options when it comes to selling your property, and let's focus on lakeshore real estate specifically, since that is probably why you are on our website in the first place. Lakeshore buyers typically come from a further distance (especially as you leave the metropolitan area), so casting a wide net for the ultimate exposure is very important in trying to attract the right one. I will revisit this at the end of the article.

You will notice that the above survey shows that only 12% of real estate transactions in 2007 were For Sale By Owner...and since 40% of those sales were closely held between family members or friends, the real number was 7%. There is not a good statistic to show how many sellers started out trying to sell the property themselves and then listed it with a real estate broker, but it's probably a fairly large number. These people most likely incurred costs in trying to create exposure for their home or cabin early on, even though they later decided to list it with an agent and pay a commission.

The article goes on to state that this 12% number for For Sale By Owners is at the lowest level since they began tracking it. In 1997, there were a record number of these sales (18%), probably due to a fairly strong real estate market and a more conventional form of advertising at the time. Besides, with many serious buyers now being represented by real estate agents, FSBOs many times end up paying a few percent of the sales price in the form of commission to those brokers to accomplish the sale.

So, in trying to sell your own lake home, you would want to consider how best to get the word out on your property. If you have a waterfront property in Brainerd or Grand Rapids, for example, there is probably over a 90% chance that your buyer will come from somewhere else. They could be from Minneapolis, or they could be from Chicago or Texas, but they are probably not looking in the local newspaper - and most likely not even the Minneapolis paper - to search for possibilities. Running ads in those places can be quite expensive, and sometimes fruitless. And if you try placing ads in the Chicago Tribune or the Denver Post hoping to get seen, be prepared to pay over $500 for a small one day ad. From what I have found, it's not a very effective marketing method!

The one thing I have noticed over the years is that For Sale By Owners tend to get more calls off of their ads than real estate agents typically do. However, that doesn't mean they get more qualified buyers. Like anything else, there are always plenty of vultures out there just looking for someone who isn't aware of the value in their property, and those people will call to find out how you react on the phone and to see if they might be able to pick up a bargain. The sad thing is...sometimes they do!

Your next option is a Discount Real Estate Company, or a minimum service company. A discount company will generally help you through the selling process, but charge you less if you sell the place yourself. You may or may not get much advertising with their services, and you may be able to choose different levels of service based on fees or commissions charged. Minimum Service Real Estate Companies are generally set up to place your property on the local Multiple Listing Service so that other real estate agents can show it and be paid a commission on a successful sale. However, it is up to you to do any advertising beyond that, and to handle the entire transaction yourself - or hire an attorney to take care of it for you. You are pretty much acting as the listing broker, so you now have their job. In 2007, about 18% of sellers used these two types of brokerages to sell their properties. However, in many waterfront markets around Minnesota and Wisconsin, these types of companies may not exist.

When you look at the possibility of using one of these lower priced companies, make sure you understand all the potential costs involved. Some so-called Discount Companies can cost as much, if not more, than Full Service Brokerages, depending on how the transaction takes place. In addition, you may incur some of your own advertising dollars in the process. A Minimum Service Company will cost you whatever you decide to offer out for compensation on the MLS, as an incentive to agents who bring you a qualified buyer...it could be 2%, 3%, 4%, 10%...or any number you choose. Plus, you will pay for any advertising you decide to do.

I know this article is getting quite long, but there is a lot to think about for a prospective lakeshore seller. The last thing I'll touch on is Full Service Real Estate Companies, which are the large majority of brokerages out there today.

The 2006 NAR Survey showed that 83% of sellers who used real estate companies chose the traditional full service model, as opposed to 81% in 2007, so that number has remained fairly strong even with all the other options these days. It's probably also due to the fact that most sellers understand the potential complexities and costs involved in marketing and selling a property. When you hire a Full Service Brokerage, it is their job to handle all the market analyses, advertising, signs, lockboxes, showing appointments, feedback calls, photos, websites, virtual tours, phone calls, paperwork...and most of the problems that arise! Pretty good peace of mind for most sellers.

Last - but not least - is the fact that with 84% of buyers using the Internet to search through available properties (that number is probably quite a bit higher for lake properties because of the distances and higher income levels involved), Full Service Brokerages are able to put their earnings back into expensive websites and a wide variety of Internet marketing techniques to get greater exposure for their listings. Anyone can run an ad in the local newspaper, but not everyone can achieve top search engine results that are needed in today's competitive real estate marketplace.

So when you start thinking about how to walk away with the most money in your pocket after the closing on your lake home or cabin, make sure you look at all the different aspects and costs involved in finding the right buyer. And take a look at a few Google searches that a buyer might use to find properties that fit their needs. Whether it's Minnesota Waterfront Real Estate, Northern Minnesota Lake Property, Minneapolis Lake Property, Duluth Waterfront Real Estate, Brainerd Lakefront, Western Wisconsin Lake Property, Alexandria Lake Property...and hundreds of other water-related searches around Minnesota and Wisconsin, you will probably find Lakehomes.com and our other waterfront websites among the top results. We've already spent the money to get there...so that you won't have to!

Nothing Like Spring!

I apologize for taking a little break from my somewhat regular posts on this blog, but like most everyone else I am a bit tired of the ongoing winter. Even my dog (Ollie) goes and hides when we turn on the Weather Channel now. It used to be his favorite show.

It seems that between the ridiculous weather and the constant bombardment of bad economic news, real estate agents up here in the northern climes are taking it harder than anyone. Just the other day there was a report of an agent jumping out the window of a tall building...although it was only from the first floor. I'm not sure if it was due to these issues, or just a boring continuing education class that he was attending at the time, but I heard the only injury was a severely bent pin on his name badge. All reports are that after a couple weeks of therapy he will be just fine (although the name badge may not be as level as it once was - and probably much more difficult to get pinned).

Interestingly enough, showings have picked up in Northern Minnesota this past week. Maybe people are fighting back by actually going out and viewing lakefront real estate, even with all this snow on the ground and several feet of ice on the lakes. I guess it's kind of a Minnesota thing to only let the weather push you so far.

Well, Ollie just went over and turned on the Weather Channel while I was typing this, so his spirits must be picking up, too. Oh look...it's supposed to be 60 degrees or so by Tuesday. And this is really something...CNBC says the price of gas is going to 99 cents per gallon by early May!

Part 6 of Series..."What to Think About When Buying Lakeshore"

Part 6: How Much To Offer

"You can tell that...x#*f~!x/#%...to...!" That's probably not the kind of response you want from the seller if you are trying to buy a lake place you really like.

It's certainly no secret that the real estate market has had a bit of a downturn over the last couple of years. The media has given us all plenty of informative reports on that. But make sure you don't rely entirely on what you read in the paper or see on TV when you find a lake property that you know is the right one for you.

In my last article, I showed average list prices and sale prices for single family waterfront properties throughout all of 2007 in the Northstar MLS. What you will notice is that the actual average sale price ends up being about 95% of the list price most of the time. So when one particular lake cabin stands out from all the others you have seen with your real estate agent, how much should you offer on the initial purchase agreement? The best advice I can give is to put yourself in the seller's shoes. How would you respond to a similar offer on your property?

Let's assume the lake home or cabin you are interested in has been on the market for 123 days, and is priced at $379,000. However, it was originally priced at $399,000, so you know the sellers either are somewhat motivated or they thought the first price they listed it at was a little high. In their minds they have already come down $20,000, so anything you offer less than that is seen as an extra price reduction they are potentially giving - even if it was originally priced higher than it should have been.

The first thing you should consider is how this property compares to others you have seen in this price range. If you have seen a dozen places and this one stands out from the rest based on the quality of the lake, the type of lakeshore, the attributes of the lot, and the integrity of the structure, then you can be assured that other lakeshore buyers will be noticing these same things. You can probably be quite confident that if you aren't willing to pay somewhere near the list price, the seller will probably find someone else who will. If they have a good real estate agent representing them, that agent should be giving them this same advice.

Now that's not to say that you have to offer full price. But if you come in with an offer of $300,000, you probably won't get much of a response...or you might get one similar to the first sentence in this article. Once you insult a seller, it gets quite difficult to get them to want to work with you again, so be careful if you really want to buy their property!

I've seen plenty of buyers end up paying more than they would have had to for a home, just because they insisted on making the initial offer so low that it wasn't even reasonable. When this happens, the seller tends to either not counter the offer at all, or they make a counter-offer that is very close to their list price. Generally, that creates bad blood between both parties. But if the buyer really wants the place - which many times they do - they are oftentimes the ones that end up giving in the most. With a more reasonable offer at the outset, they very well would have ended up with a better price through more friendly negotiations.

Obviously, there are many factors to consider when you decide how much you will pay for any property, and there are plenty of them that are genuinely overpriced. But over the years I've found that lake property owners seem to have a special attraction to their unique parcels, and many times they are willing to wait until someone comes along who seems to appreciate their place as much as they do.

If you have decided that this is the right one for you - and that the price is not too far off already - make sure they don't think you are trying to take them to the cleaners. Otherwise, you might not get another chance at it.

The Real Scoop on Waterfront Sales...Month by Month

As I ride around with clients looking at various lake homes, I always get questions from them relating to typical market times and other sales statistics. I can generally answer these within reason without doing a lot of research, but I thought it would be interesting to delve a little further into the exact statistics for an entire year.

The difficulty in finding good information on this lies in the fact that there are nearly 20 different multiple listing organizations throughout Minnesota, and another 25 or so in Wisconsin. Each of these organizations has their own unique method of displaying information, and there is no realistic way to combine statitics from one organization with those from all the other areas - unless I had several days of nothing to do other than manually combine them into one big spreadsheet. Obviously, the sales statistics in Kenosha, Wisconsin may not be a good indication of what is happening in Bemidji, Minnesota, so it would be kind of fruitless to attempt this undertaking anyway.

At the current time, the Twin Cities Multiple Listing Service (also known as Northstar) is the most comprehensive one there is. It is really a combination of several individual MLS organizations around the metro area, but it also extends much further into other areas of Minnesota and Western Wisconsin. Many real estate companies in outstate areas have joined Northstar - in addition to their local MLS services - to do a better job of marketing their listings to a larger audience. So by using statistics from Northstar, we are getting a pretty good overview of waterfront sales throughout a fairly large region.

OK...we got the boring stuff out of the way. But I thought it was important for you to understand just how confusing it is out there in the real estate world, and why even with the ease of the Internet it is still cumbersome for consumers to search for real estate throughout wide geographic areas.

Now let's get back to the typical waterfront buyer and see what might be important to them. A typical day of lake house hunting might involve showings on ten different properties in the course of about 200 miles, versus maybe ten houses in twenty miles for an in-town buyer. This is because lake property buyers are normally more concerned about finding the right type of lake - along with the house that fits their needs - within a certain distance of their work (by the way, buyers in search of lake cabins may very well be looking over an even larger area that is a certain distance from their home).

If a buyer is looking for a 3+ bedroom lake home, built 1990 or later, on a 500+ acre lake, under $600,000, and within one hour of Minneapolis...we will be driving most of the day to find enough of them to look at (as of today there are only 15 of them on the market that fit this criteria). In other words, it's going to be a long day in the car with lots of thoughts running through everyone's heads.

The first couple hours are always easy. There is a lot of conversation about each other's work, family, and so on. The buyers are excited to get inside the first lake homes and get a feel for what types of things they can expect to find in their price range. Unfortunately, most of the time their expectations are a little higher than reality. So as the day wears on we begin to talk about average market times, the percentage of list price to sales price, the best time of year to buy, remodeling costs, the distance from Venus to Pluto...and so on. That brings me to what I was going to write about in the first place: the market statistics for 2007, month by month.

By going through the single family waterfront sales on Northstar MLS in each month of 2007, we can get a fairly good correlation of the amount of waterfront sales - along with market times and other statistics - in relation to the time of year they occur. Here is that breakdown:

The information below is based on average list price at time of sale, and average sale price. The average days on market are total days on market, even if listed with two different companies during that time period

January
Sold Properties - 249
Total Avg Market Time - 165
List Price - $397,046
Sale Price - $380,326
Percent of List Price 95.8%

February
Sold Properties - 262
Total Avg Market Time - 159
List Price - $421,412
Sale Price - $403,875
Percent of List Price 95.8%

March
Sold Properties - 307
Total Avg Market Time - 171
List Price - $403,559
Sale Price - $388,547
Percent of List Price 96.3%

April
Sold Properties - 441
Total Avg Market Time - 171
List Price - $443,372
Sale Price - $420,885
Percent of List Price 94.9%

May
Sold Properties - 473
Total Avg Market Time - 152
List Price - $429,403
Sale Price - $410,695
Percent of List Price 95.6%

June
Sold Properties - 524
Total Avg Market Time - 145
List Price - $435,710
Sale Price - $417,835
Percent of List Price 95.9%

July
Sold Properties - 512
Total Avg Market Time - 169
List Price - $431,954
Sale Price - $411,677
Percent of List Price 95.3%

August
Sold Properties - 413
Total Avg Market Time - 150
List Price - $401,039
Sale Price - $380,417
Percent of List Price 94.8%

September
Sold Properties - 325
Total Avg Market Time - 183
List Price - $413,349
Sale Price - $391,185
Percent of List Price 94.6%

October
Sold Properties - 339
Total Avg Market Time - 186
List Price - $433,318
Sale Price - $408,916
Percent of List Price 94.4%

November
Sold Properties - 214
Total Avg Market Time - 166
List Price - $396,617
Sale Price - $373,373
Percent of List Price 94.1%

December
Sold Properties - 187
Total Avg Market Time - 179
List Price - $446,749
Sale Price - $416,514
Percent of List Price 93.2%

So, what does all this mean? I don't know, but at least it's not a secret anymore. And just like we all knew before I spent the last several hours compiling this, there are more waterfront sales in the summer than there are in the winter!

Oh, and I guess if we go out looking at lake properties, we'll have to find some other things to talk about now.

Minnesota Isn't Too Bad After All

My family and I have been down on Mustang Island on the East Texas Coast for a few days, visiting relatives and getting a needed break from the monotony of winter. The weather has been great - mainly in the upper 70s - and there's been plenty of sunshine to give us some attractive sunburns. But along with the great weather they can offer, these southern climates also have their share of negative aspects that we don't have to think much about up north.

It certainly is refreshing this time of year to get up and have your morning coffee on the deck in a pair of shorts. In Minnesota you still have to wear several layers of clothes to do that, and most likely your deck furniture is still buried under the snow. But those of us who are native to the north country aren't used to checking to see if there is a scorpion under our chair before we sit down, which is not a bad thing to think about down here.

Although it is common to find a few pickers on a walk in the woods almost anywhere in the Upper Midwest, Texas lawns can be filled with some of the most heinous plants you can imagine. They will try to poison you with every step, or jab through your clothes if you try to sit down (barefoot walkers and thin shorts wearers beware). And when you are taking a short cut to the beach, be sure to watch out for the rattlesnakes sunning themselves on those inviting sand dunes!

But just when you think the plants and land critters are a little scary, just spend a few hours on the ocean reeling in some of those interesting creatures that resemble several of the species in Star Wars! It seems that almost everything that lurks down there has a goal of causing you immense pain and suffering if you dare to pull it out of the water.

I know we get a little tired of the mosquitoes up north, but other than them and a few ticks we really have it pretty easy. We have lush lawns to play in, clear waters to swim in, and some very pleasant weather during the summer months. If you want to sleep out under the stars on a warm July evening, you may end up with a few itchy bites in the morning, but you will most likely still be alive to scratch them.

But don't get me wrong, I love the warm weather and expansive beaches that offer a respite from the seemingly never-ending winter. The sunshine and fresh air down south can create a renewed energy that helps us remember why we put up with the long winters up north, and it gives us a glimpse of what we can look forward to in just a couple of months - or maybe three.

So hang in there. I've seen the sunshine and it's heading your way...and I don't believe it's bringing all the other weird things with it.

Oh yeah, I forgot. There is one more wild and crazy animal that I've come across this week on the beaches down here in Port Aransas: The Spring Breaker. Maybe that's why we have winter in the first place...to keep them away!

Happy Easter

Opportunities Are Easy to Recognize...Once They're Gone!

I woke up this morning to another onslaught of bad economic news, along with the collapse of the giant Wall Street firm Bear Stearns. Each day we are bombarded with more and more stories of business tragedies, higher gas prices, and recession worries...along with sagas of people losing their homes to foreclosure, and plenty more that are deciding to just walk away from their mortgages rather than making payments on a place that is not worth what they now owe.

There is certainly no shortage of blame to go around, but a lot of the problem has to do with people not recognizing the reality that is staring them in the face. I thought it was pretty obvious a few years ago that appreciation of 10%-20% per year - on homes in many areas of Minnesota - could not continue very long, if wages were mostly stagnant. It seems that when times are good, a large portion of the herd forgets that they might not be good forever!

But I'm not an economist. I'm only a simple real estate broker who makes bad decisions on things...sometimes, just like a lot of other people do. However, one thing I do know a lot about is waterfront real estate, and the trends that point to strong sales for many years to come in those types of properties.

I would guess that about 98% of the population (if not more), wishes they would have purchased lakeshore property ten or twenty years ago. From being in this business, I have heard many of the stories of how some one's dad or grandpa could have purchased an entire mile of lakeshore on a now popular lake for perhaps $10,000...and they only had to pay $24 per month with 2% interest until it was paid off. Or they might remember the family cabin that six siblings could have bought for $40,000 in the mid 80s, but no one could scrape the money together. Almost everyone has at least one of these tales of woe.

After specializing in waterfront properties for over 20 years, I can tell you that I have never seen so many opportunities to purchase some pretty amazing real estate for less that what the real value is. When you consider the fact that many of the lakeshore lots have not really dropped very far in price (if at all), and the cost of building has not gotten any less expensive, you start looking at the ability to buy the structures on these lake lots for almost nothing. Even if it needs a little remodeling, you can end up with quite a place for way less than what it would cost to replace.

What makes this opportunity even greater is that most people love to follow the pack for reasons of safety. They love to recite "the sky is falling" comments that were stated by 237 different analysts on the thirteen different morning news programs they watched before work. And, they just don't want to take a chance at making a mistake on this important of a purchase!

I would never advise anyone to be reckless in the pursuit of any type of real estate. It only makes sense to do your homework, and use all the tools in your arsenal (including the market knowledge and sales data your Realtor can supply) that you have at your disposal, before you make any decision to buy a particular property.

But I would also caution you not to be overly hesitant on buying while the bad news is a brewing. Otherwise, when the herd starts moving again you might be at the back of the pack. And who knows what will be left over?