Monday, May 23, 2011


I’m appraising a 1/2 dozen neighborhoods in Blaine. As I’m driving around a see a ReMax sign and the agents name is “Twilight Dew”. She must have been born in the late 60s with Hippie parents! “Twilight Dew” also sounds like it could be the name of subdivision. I looked at so many it was hard to keep track.
In other Twin Cities communities that I have appraised lots in, its a struggle to even find any comparable sales for my analysis. Until the recent past, even other Twin Cities communities that still had building activity through the real estate crash, like Woodbury, did not have lot sales. Builders already had so many lots they owned that they were not buying more.

There are so many developments in Blaine, and so many neighborhoods within those developments, that it felt overwhelming to understand the Blaine market. I had to add a second full day to drive and walk the neighborhoods. But I enjoyed it, as so many of the neighborhoods were well designed.

I'm a professional with nearly 30 years experience in land development and I felt overwhelmed by the market in Blaine. So what must it feel like to a home buyer to have so many choices?

I visited with Mike, a Lennar salesman at their beautiful new development, The Woods at Quail Creek. In my ongoing quest to collect market data, I asked Mike if he had sold homes in other Lennar developments.

“I just started working with Lennar”, said Mike. “I'm a realtor and I bought a new home from Lennar in Victoria. I was so impressed with the process that I came to work for Lennar. Lennar offers 'everything included homes' with minimal options. Looking at custom homes there are so many to choices to build the house its overwhelming. Going the custom route, I could picture arguing with my wife on everything from floor material to the knobs on the kitchen cabinets. Lennar was just easy because there were so few choices to make.”

“And the price was so much lower than custom homes.”

So, as Mike tells us, when the choices become overwhelming, it gets down to price.

If you wish to unsubscribe, send an email to

Thursday, March 24, 2011

Contesting Your Pay 2012 Property Tax Valuations

Contesting Your Pay 2012 Property Tax Valuations
A client who owns property in Wisconsin told me the assessor is required to keep a file of the comparable sales they used so set the value for every property. In Minnesota, the TAXPAYER has the burden of proof to show that the assessed value should be lower.
Whining doesn't work.
Those that tell me they have not seen results in contesting their property taxes either appealed something that was valued correctly, or they didn't have an appraisal to prove a lower value.
The “Notice of Valuation and Classifications for Property Taxes Payable in 2012 have been drifting in. There are no legal or filing fees for this process if its done on a timely basis. And the process to contest them is not uniform. You need to read the notices carefully.
For example, Anoka County and Ramsey County do NOT have a Local Board of Review. They have Open Book Meetings, April 5-7th in Ramsey and April 27th - April 29th in Anoka. Then they each have a County Board of Appeal and Equalization in June. But the process differs between the Counties on how to get on the addenda.
Some Local Board of Reviews are the first week of April. For Cities or Township that have a Local Board of Appeal and Equalization, you MUST go there first, either in person, by letter, or by a personal representative. Then you can move on to the County Board of Review if you're not happy with the results from the Local Board. The County Board may be more effective than the Local Board, which is typically the City Council,which, in most cases, are not valuation experts. But blow off the City and you lose your opportunity to go the to the County level.
Despite being a yogi and mediation practitioner, I'm still a woman of very little patience. I like to get things done quickly.
Tax Court can take years. I recently completed an appraisal for an attorney for a tax court case for taxes payable in 2008! The Board of Appeal and Equalization, by statute, MUST complete there work by the end of June 2011 for taxes due in 2012. And if you aren't happy with the result, you can still file in Tax Court.
I operate on the belief that when the assessor MUST look at support for the Pay 2012 appeals, they might as well review the data for the Pay 2011 Tax Court Petition at the same time. Or even earlier years if they are outstanding. Especially on more complex properties. Once the assessor gets their head around understanding the property and they go out and inspect it, its minimal effort to review another years worth of market data.
If you send me your “2011 Notice of Valuation and Classification” TODAY, then it won't be your property in 2014 that I'm writing your appraisal for a 2011 property tax appeal.
Time is running out. For a free review of your property tax valuations email your notices to or, if it just a couple notices, you can fax them to 763-420-9792.

Monday, March 14, 2011

Chasing Demons in Grand Cayman

Chasing Demons in Grand Cayman

Dudley, the owner of the small waterfront place I stay, hands me the jacket I left there last year. He tells me “the Canadians are staying below you.” Mr. Canadian was so loud he immediately disturbed the tranquility I travel to Grand Cayman for.

My yoga training has taught me to find compassion for whatever demons in Mr. Canadian's life, whatever experiences he's had that caused him to be so obnoxious and create his need to constantly be the center of attention.

He still irritates me. I am far from an accomplished Yogi.

I plug in the ear bugs and send a silent thank you to my neighbor for loaning me her audiotape of an Irish Harry Potter knock off. Its a series about a skeleton detective and his teenage girl sidekick as she learns magic to slay demons.

I go for a long walk on 7 mile beach. A sign advertises a new 60 unit condo building with pre-construction pricing staring at $2.7 million. Though the market here is weak, there is some activity. Further down the beach I walk through a $3 million model in a 9 unit beach front building that shows signs of some sales. And there is scattered single family construction around the island.

I lose track of time and distance walking miles on the beach and cut to the street to catch a bus back to my apartment. Buses in Grand Cayman are actually privately owned vans whose owners lease a route from the Government. As I climb on the bus I'm greeted by a “NO FARTING” sign, something I have never seen on a Maple Grove Transit Bus. I hand the driver the colored currency I found tucked away with my passport. “What's this?” he asked, as I realize the money was from Belize. The driver laughs and waves me off the bus. I've seen other drivers pull up and wait for riders to get money from an ATM.

I go to yoga class and the teacher talks of bringing our demons out of the shadow. To confront them. To ignore your demons causes “dis-ease”. That a recent study showed cancer often appears 18 months after a trauma. Locking your demons in the closet or shoving them under your bed does not make them go away. These demons cause disturbance in your life that may manifest as aches, pains, insomnia or worse. Until you pay the demons the attention they demand and take care of whatever you are ignoring. And then, with yoga and meditation, you can often regain a healthy balance and get rid of dis-ease.

Any day now you'll be receiving your 2011 Property Tax Valuation Notice for taxes payable in 2012. Do you typically just toss this notice in a drawer? Bad move. You have a small window of opportunity, typically till the first week of April 2011, to quickly slay this demon. This is a quicker and simpler process than Tax Court.

I can help you with my magic to lower your property taxes if your valuation is too high. But you need to show me your valuation notices NOW! For a free review please scan the notices as soon as you receive them and email to Or, if its just one or two, you can fax them to 763-420-9792.

Wednesday, March 2, 2011

Rental Townhome #2 St. Louis Park

Rental Townhome #2 St. Louis Park
I've been trying since August to purchase this beautiful townhome in St. Louis Park. Its a short sale, with CitiMortgage being the lender. I close the end of March, two weeks before CitiMortgage would go into title. This way, I was able to use standard Minnesota Purchase Agreements and get a warranty deed from the seller.

The issue was price. In August, the list price was $121,500, I offered $110,000. The seller signed my purchase agreement, but CitiMortgage,after months of waiting, countered at $121,000. CitiMortgage had gotten a Broker Price Opinion instead of an appraisal to evaluate my offer. As I have never seen the BPO, I can just guess they didn't adjust for a pending assessment of around $7,000 for a future balcony replacement. I walked from their counter of $121,000 in the fall.

When I noticed in December that this was still on the market and the price had dropped to $116,300, I made another offer at the same $110,000 I had offered in August. The seller signed my purchase agreement. After a couples months wait CitiMortgage countered at $118,000. I countered back at $116,000 and we had a deal. I did land up $5,000 lower than their counter from the first offer.

After looking at so many townhomes, I realized that this is the best one I've seen. Its located only four blocks from the Louisiana Exit at 394, close to the new West End shopping center and only minutes from Downtown Minneapolis. If you looking at a single family home in good condition in St. Louis Park that has at least 1,700 square feet, three bedrooms, three baths, and, this is the key, a two car attached garage, you're looking in the price range of $300,000 -$700,000. So at $116,000, + the balcony, I'm pleased with the price.

For reasons I don't understand, this townhome has a shower in the master bath, and the others I've seen in the Greensboro development only have a ½ bath. That extra shower makes a big difference in the tenant appeal, and was one of the main reasons I bought the Chanhassen townhome.

After all the repairs I've needed to do to my Chanhassen townhome, I really appreciate the pristine condition of this home. All high quality laminate floors in the entire home. Updated kitchen. New furnace and air conditioner. And it helpful that the owner is still living there. Homes do better when lived in and I know everything works.

And none of that vinyl siding that can become a dirt magnet. Its brick.

The home has really good vibes.

You sit on your balcony and can you see the pool, tennis courts and clubhouse. You walk out the other way to the landscaped patio, go up ½ flight of stairs, and catch the bus. Or walk four blocks to the Louisiana Transit Center.

Where I hesitated on this was the high HOA dues to cover the amenities, which also include two full time on site property managers that even change the furnace filters, as the furnace is on the roof. The HOA dues are $337 a month, versus the $160 I pay in Chanhassen. To get the same cash flow and rate of return as Chanhassen, I needed rent of $1,795 a month.

So before finalizing the deal, I checked the MLS for rentals, found a similar townhome in a different neighborhood in St. Louis Park, that didn't have the pool and tennis, for $1,795 a month rent. The listing was marked canceled.

Thinking it won't work at this rent, I called the listing agent. She said they had a lot of showings and had two professional women ready to sign the lease, but the owners switched gears and decided to sell instead. Armed with this information, I signed the counter offer and I'm getting ready to close.

If you know anyone looking for a beautiful rental at an awesome location, clink this link, then click on the list number shown in blue.

Wednesday, February 23, 2011

Property Tax and Classification

Property Tax and Classification

Developer owns three one acre lots on a Trunk Highway.

Each of the three parcels are CLASSIFIED as Commercial for Property Taxes and VALUED as Commercial for Property Taxes.

Initial research reveals:

Comp Plan
Tax Classification

Med Density Residential
Med Den Residential

Med Density Residential


Under Minnesota State Statute when there is a conflict between the Zoning and the Comprehensive Plan, like in Parcel B above, the Comprehensive Plan prevails when a development application is submitted.

Quiz: Answers at the end of the quiz

1) Parcel A should be CLASSIFIED for property taxes as:

a) Non Homestead Residential

b) Commercial

c) Don't have enough information

2) Parcel A should be VALUED for Property taxes as:

a) Non Homestead Residential

b) Commercial

c) Don't have enough information

3) Parcel B should be CLASSIFIED for property taxes as:

a) Non Homestead Residential

b) Commercial

c) Don't have enough information

4) Parcel B should be VALUED for Property taxes as:

a) Non Homestead Residential

b) Commercial

c) Don't have enough information

5) Parcel C should be CLASSIFIED for property taxes as:

a) Non Homestead Residential

b) Commercial

c) Don't have enough information

6) Parcel C should be VALUED for Property taxes as:

a) Non Homestead Residential

b) Commercial

c) Don't have enough information

7) If a property is misclassified as Commercial when it should be Residential, the Property TAX may be TRIPLE what it should be at the same Valuation.

a) True

b) False

Answers to the quiz:

1) A 2) C 3) A 4) C 5)B 6) C 7) A

You needed to know these two facts to ace the quiz:

A) For Property Tax Classification of VACANT land where there is no obvious use, its classified how its ZONED. Comp Plan is irrelevant in classification.

B) Property should be VALUED at its highest and best use. Highest and Best Use is based on what is a) Physically Possible; b) Legally Permissible; and c) Financially Feasible.

The Highest and Best Use is the most critical component of any appraisal. And I haven't finished my analysis for these three parcels to make that determination.

Classification is something I've observed most property owners blow off, focusing on the value. But challenging the classification may have even greater impact to your property taxes than challenging the valuation because there is such a huge difference in tax rates.

Are your properties misclassified? For a free evaluation, send me your PIDs, property locations and your contact info to

The deadline to challenge your Pay 2011 property taxes is April 29th, 2011.

Wednesday, February 16, 2011

Ramsey Town Center

Ramsey Town Center
I made my first visit to the Ramsey Town Center today. Its not a location that is typically on the way to anything. I was out there for a tax appeal. And anyone that has property in the Ramsey Town Center needs to consider appealing their property taxes, residential or commercial.

When you visit the struggling commercial area, I find it ironic that this shiny new building is the offices of the Midwest Medical Examiner. As the Ramsey Town Center is strewn with dead developments.

Its sad because there are some lovely homes built there, beautiful architecture on the the townhomes. But the projects have all been mothballed. Not one model home to be seen. And one sad “to be built”, a 2 bedroom, 1 bath single family home on a 55' wide lot advertised at $154,000 is the only active listing I could find on the MLS. As often the case, in addition to the builders, those that are suffering the most are the homeowners that bought into the dream. Unless they are very fond of quiet and don't like having neighbors.

As to solds in the last year--3 partially completed townhomes sold for $45,000 and a water damaged one for $52,000. And a new nice single family home, 2,500 square feet finished with 4 beds and 3 baths sold for $262,000. Lonely, though. It was really quiet out there on this flat open land.

It was a project that never made sense, even when it was conceived in the peak of the hot real estate market by the City of Ramsey, who sought out a developer. Though I doubt the City could have even considered the resulting bank fraud that landed people in jail and contributed to the main appraiser involved committing suicide. Back to the dead body thing again.

Expect for what appears to be a mostly empty commercial building with an event center, and a new Alina Clinic being built, all of the other “Town Center” commercial buildings are this amazing City Hall, the new VA Clinic being built, a large multistory empty parking garage, and the Medical Examiners Office.

Thursday, February 10, 2011

I'm a happy landlord

I'm a Happy Landlord!

As my closing approached for the beautiful townhome in Chanhassen, I placed a for rent ad on Craig's List. When I did my original projections it was based on a rent of $1,300 a month. And there were two other three bedroom townhomes advertised in the area at $1,300.

I knew my townhome was a superior location and floor plan. So I tossed it on Craig's list at $1,475 on a Friday evening. And got two calls right away--though they wanted an April 1st move in and I was looking for March 1st. But I was excited and told my friend who I copied the rental townhome strategy from.

“Laurie,” he told me. “It usually takes 15 showings to get a signed lease.”

Two days later I get a call from a wonderful woman, newly divorced, with three teenage girls who specifically wanted to live in the my Oak Hill townhome neighborhood in Chanhassen. Her marital home was close by and the girls' dad lived just down the road, with his new young honey and baby boy. Same schools for the girls, close to their friends and sports. This townhome is close to EVERYTHING, at the intersection on Highway 5 and Powers Blvd.

My closing was delayed three days due to the Texas storms, as the seller was Freddie Mac from San Antonio.

For some odd reason, Freddie Mac does not pay deed tax when they sell property.

Got the signed papers from Freddic Mac at 4:00. And the lease was signed at 8:00 that evening.

So the seven month search for the perfect townhome was not wasted. I wouldn't have immediately recognized how special this one is. I paid $4,100 over list price because there was another offer. If I hadn't seen all the others first I would have probably bid too low and lost it.

I'm getting about a 12.5% rate of return. Given both the real estate and financial markets, I'm pleased with that. So I'm a happy landlord!