SharonsSlideShare

SharonsFacebookStory

Here’s my Facebook movie. Find yours at https://facebook.com/lookback/ #FacebookIs10

Posted by Sharon Anderson on Monday, February 10, 2014

Steinhauser vs CitySt.Paul et al

https://www.scribd.com/doc/274740120/Steinhauser-et-alFairHousingFS-Brief-Per-Ct-Order-Ecf-8-3-15-Copy

SharonsVideo

https://www.facebook.com/sharon4anderson/videos/10202718447871762/

Thursday, April 28, 2011

Investors_foreclosure_Homes_PonziSchemesCavetEmptor

houses — and their image

















The Frogtown house that faces the roar of traffic along Interstate 94 in St. Paul was once vacant. Now, investors Peter Harrington and Mark Pasvogel have snapped up the foreclosure and are busy renovating it.

Harrington and Pasvogel represent a new breed of buyers who see opportunity in the flood of foreclosures across the Twin Cities. Once workers wrap up, they plan to sell the four-bedroom on St. Anthony Avenue, envisioning a family calling the 2,200-square-foot property home.

"We're fixing up the neighborhood. We're providing affordable housing," Pasvogel said. "Everything we're doing is positive."

Could real estate investors be going through an image change? Once seen as speculators who drove up housing prices during the boom, they're now seen as key to turning the bust around.

The bargain prices of foreclosures make them a business opportunity for the brave willing to buy, rehab and sell or rent out the improved properties.

Neighbors of foreclosed houses are often supportive of the effort.

Diane May is sorry for her East Side neighbors who've lost their homes through foreclosure but remains optimistic about the future of her Dayton's Bluff neighborhood. "I'd rather see them stay vacant and have them purchased by someone who'll fix them up than bought by someone who doesn't care about the neighborhood," May said.

Last year was the second-worst year for foreclosures in Minnesota, with 25,673 foreclosures.

This year's number is expected







Advertisement












to be similar. Nearly half of all metro home sales in recent months have been foreclosures, with a median price of $115,000 in March versus $206,000 for traditional sales, according to real estate brokers' data.

Meanwhile, some potential first-time homebuyers won't make a move with a federal tax credit gone and continuing angst about jobs. Others don't have the stomach for the work an overhaul of an abandoned house often takes.

Investors to the rescue.

Harrington, Pasvogel and a couple of other investors formed Marpe Development to buy and fix up foreclosed houses and multiplexes to sell or rent. They work primarily in Frogtown and on St. Paul's East Side in the Lake Phalen and Dayton's Bluff neighborhoods.

They wouldn't disclose how much they're paying to redevelop the St. Anthony Avenue house, but such projects can run up to $100,000 and beyond. The house at 757 St. Anthony Ave. was purchased for $40,000 last year in a bank sale, according to Ramsey County property records.

They can't obtain construction loans because of the tight market, so they borrow from friends and relatives.

Workers are updating the house, including taking down walls that once closed off a porch. They're installing a new kitchen



with a granite-topped island and finishing the basement to include a "task room" with a washer and dryer as well as plenty of counter space for other projects.

Part of the home's potential appeal, they say, is that it's a short walk from a future light-rail station. When the overhaul is completed, they're considering putting the house up for sale at $170,000. It's enough to make a profit but not enough to get rich, they say.

Real estate investor Dan Grohs, who purchased his first foreclosure in 1979, isn't sure that housing prices have bottomed out, but they're good enough for him. He has purchased three properties this year near Lake Phalen in St. Paul and in the Camden neighborhood of North Minneapolis.

"There's never been an opportunity, in my opinion, to buy like this in 32 years," said Grohs, who has purchased, sold and rented out hundreds of houses, duplexes and apartment buildings.

Grohs has paid cash for his recent foreclosure purchases. "How can you miss? You rehab and rent them out or sell them on contract for deeds or out-and-out sell them," he said.

It's not that he thinks housing is always a sure thing. Grohs got nervous when home prices were skyrocketing during the boom and sold all his properties in 2004, then waited a couple of years before starting to buy again.

"Are the prices ever going up to where they were? Probably not in my lifetime," Grohs said.

He owns up to 15 properties at any given time, does much of the work himself to cut costs and usually has at least one house on the market.

"What is interesting is now is the time when banks should be lending money, and they're being ultra-conservative," Grohs said.

One thing all investors have in common these days is difficulty finding financing. That means they often have to put in more cash — and more risk. Since loans for such investments are harder to come by, they often dig into savings, refinance their own houses or turn to family and friends.

"My wife and I have an 800 credit rating, but it was very difficult to get the money," said Bob Schmidt, a newer investor who has purchased two East Side foreclosures.

The process of bringing these houses up to city codes isn't for the faint-hearted. Most need a lot of work.

"A lot of the banks are dumping some properties at pretty low prices," said Ken Erickson, a Coldwell Banker Burnet east metro agent. "The Catch-22 is that generally, the buyer gets a better deal but it's a lot more work than what they've bargained for."

Bob and Lori Schmidt purchased two foreclosed properties near Lake Phalen with Erickson's help and are renting them out. Bob is on disability from a career in human resources and Lori is a St. Paul elementary school teacher.

After refinancing their home, they bought a house last fall at 1002 Hawthorne Ave. E. in St. Paul for $58,000 and put in $50,000 to bring it up to city codes.

In November 2009, they had used a line of credit offered by their bank to buy a duplex in the 1600 block of Arcade at a home auction for $85,000 and also put in about $50,000 of work. Rental income for both properties totals about $40,000, which covers the mortgages and renovation costs, Bob Schmidt said.

In their tours of foreclosures, Lori Schmidt recalls seeing some very poor-quality houses, including one that had motorcycle tracks on the rug.

As for the future, Bob Schmidt said he's not sure he can handle the stress of overhauling another foreclosure. Yet the deals still capture his attention. He has his eye on an $18,000 foreclosure but isn't sure whether they'll be able to find the money to buy and renovate.

The Schmidts expect they'll one day be able to generate income from their properties and eventually sell them for a profit. They also see themselves helping their community by purchasing and upgrading foreclosures.

He hopes others will do the same but offers a caveat: "Now is an excellent time to invest but you've got to know the ropes."

Gita Sitaramiah can be reached at 651-228-5472.







Sharon4Anderson


Saint Paul, MN




Its still a Ponzi Scheme www.**** check out the propertys taxes The City St.Paul www.sicko-citystpaul.blogspot.com The Evidence is conclusive of "Sweetheart Deals" unabated by the City St.Paul Officials.
Thats why Sharon 4 Council to expose Ponzi Schemes www.sharon4council.blogspot.com The City deletes Web Sites with Forensic Files www.saron4anderson.org or Google Sharon4Anderson v. City St.Paul Thanks


Sharon4Council

VoteSharonWard2Council_AndersonAdvocate4All

VoteSharonWard2Council_AndersonAdvocate4All
SharonsSocratiesMethod TruthTrust4YOU

JURIST Paper Chase

Dayton's MN ShutDown Costs

2007 Sharon StPaul Ward(2) Election

Minnesota.com

Blog Directory for St Paul, MN

Snap Shots

Get Free Shots from Snap.com

AllMNSharon4

Sharon4Council: Empower Ethics Empathize Energize Educate:

Sharon4Council: Empower  Ethics Empathize Energize Educate: