Home Selling in Minneapolis>Question Details

hobbinsb, Home Seller in Minneapolis, MN

My neighbor and I are both looking to sell our homes. My neighborhood (SW MSP) has had a lot of build ups/outs. Can we bundle our lots to add value?

Asked by hobbinsb, Minneapolis, MN Sun Jan 6, 2013

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Mark Claessens, e-Pro, NHSS’s answer
Hobbins,

Please let me stroll back into the conversation here. I just had a call from an un-named individual that called both my office and also called our corporate customer care center. Both did not leave a name or number. Not sure if that was you, but here is my cell: 612.386.8386.

I see lots of additions here about tearing down houses and combining properties

Listen, with all due respect to you and everyone here, we just don't have a lot of details, Hobbins. But seriously, you can't take two of what we call "developed properties with a residence" and just combine them. This can't be done. And many cities will not allow even an extra lot on a separate PID to be combined with another devloped lot with a residence. But as I shared before you most likely would not want to do that anyway because you get more, way WAY more money selling separately.

Look at it this way. Consider any situation you can imagine where you as a businessman/woman or even as a consumer, wanted to buy something. Would it not clearly stand to reason that the more "stuff" you got in that package you were buying - whether it was a package of 100 foreclosed properties or a package of 48 bottles of soda - that you would expect a better price than buying one of them? EXACTLY! Now you get the picture.

Next step.....

There are a lot fo great agents here giving you their opinions and revealing their experience with this. Since it costs you absolutely nothing to engage a real estate professional and our various leveles of experience and expertise in this, I recommend that you ake some calls to those that you feel may have a good handle on this.

If you do that, Hobbins, you are then going to be able to add a very important factor into making your decision on what to do. Because after talking to a few of us, you will - for a fact - not only have some KNOWLEDGE on this subject, but you will gain some good WISDOM. You need more than information or knowledge, you need to dig deeper than that. And while you're at it, make sure that either you have a very good real estate attorney, or that your agent and broker that you talk to has one that represents them, as well. This is huge in a transaction. Huge.

Have a terrific day, Hobbins,

Mark
2 votes Thank Flag Link Mon Jan 7, 2013
Hobbins..

Great question. You haven't give me all the information I need to make a solid answer. If you are asking about selling your home with or without an additional lot, that is one question. If you are discussing joining any number of PIDs together, I would highly advise against that due not just to complications in selling, but in the future insterest with a potential buyer. I have sold many properties where there has been a desire to combine PIDs/land/lots.....and worked closely with our legal counsel on them. In only one case did it make sense, yet in the end I was able to secure a solid deal without combining them. We left it to the buyer to do that if they chose after the fact.

And actually in each case that we chose to sell them separately, and even use them as selling leverage, my sellers were able to capitalize on that and actually get quite a bit more money selling them separately.

I would be glad to discuss your situation with you. Feel free to click on my website link below and when you go to my website all of my contact information is right there for you.

Mark
2 votes Thank Flag Link Sun Jan 6, 2013
I think you would get more money selling the lots individually, typically when people "buy in bulk" they expect a discount. You would also have more possible buyers as not everyone is looking to buy huge lots. As mentioned by another agent below you can put them on the market at the same time with a note that both of them could be purchased together.
0 votes Thank Flag Link Mon Jan 7, 2013
There's limited information here, but as usual, the answer is, "it depends". The most likely answer is no. There may be some buyers who could be interested in the senario, and there may be some circumstances that would work. An example could be: high value lots (like on Lake Harriet) with substandard houses. My instincts, and knowledge of SW Mpls., tell me that in most situations, there's not likely to be added value. But if the timing is right for both of you, a package offering in addition to separate sales, can't hurt. But if they were to sell as a package, how would you decide how to split the procedes? Good luck, and please feel free to contact me for more information.
0 votes Thank Flag Link Mon Jan 7, 2013
Two main steps

1. both of you find out with an experienced local Realtor or two by getting a detailed market evaluation
and pricing proposal for each property separately

2. Find out about the zoning in your area, will it be allowed for the buyer, to tear down the two homes
and build a large home on the combined lot

and then if 2 is NO, forget combining, if 2 is yes it can be done
Then you need a second market evaluation to see what the interest in your area could be for
anyone individual or builder to actually want to combine the two lots and build a large expensive
home on it....

So go slow, get all the information first, especially what is allowed by zoning laws and what is not
and what will be the recommendation thereafter by the professionals....

It really depends on all the answers to the questions above.

Good Luck to you

Sincerely yours,
Edith YourRealtor4Life & Chicago, North Shore & Northern Illinois Expert
Working always in the very BEST interest of her clients, Buyers, Sellers and
Investors alike....And always with a SMILE :)

Covering for @Properties Chicago & suburbs, and with her trusted Partner
Agents US & world wide properties. French, German, some Spanish &more EdithSellsHomes@atproperties.com or EdithSellsHomes@gmail.com
Check out my website at http://tinyurl.com/YourRealtor4Life
Get to know me! Learn about my experience, expertise, services! Read letters
of recommendation! Sign up to search for properties in my expanded service area.
HAVE THE MOST WONDERFUL DAY :)
0 votes Thank Flag Link Mon Jan 7, 2013
Hobbinsb: The first question is what are the lots zoned for or could be zoned for. If they are R! then you are limited and combining them would be of little value. If they along a main street and there is the potential for rezoning then it might make sense. Go to the cities website and look at the zoning map. You can also email me the information and I will get you a better answer and some options. Another call should be made to the city Planning and Zoning for thier input. If you did find abuyer and it was not doable you would have wasted a lot of your time. Contact a Realtor that does development or has the knowledge of it. I have been doing this for over twenty years in Minnesota and parts of Florida and can help you very quickly if given the information. Let me know how I can help. Tom, TSimonsen@Counselorrealty.com
0 votes Thank Flag Link Mon Jan 7, 2013
First steps first. Have a professional come in and give you market evaluations on what both properties are worth - both separately and potentially together. Selling your home or both your homes is a big step and you should make sure that each of you know the value of your properties and what each of you want to get out of your respective homes. I am assuming you each have separate title's to your homes so they will need to be closed on separately. Should you decide to combine and sell I recommend a good real estate attorney set up an agreement between you and your neighbor prior to closing so there are no issues afterward.

I am happy to help you determine value and get your properties sold. I also have a great Real Estate Attorney if you would like to speak to one. Generally he will do an initial phone call at no cost.

Vicki Schwartz
MN Real Estate Options
Broker/Owner/Short Sale Professional
Accredited Platinum Real Estate Professional
Phone: (952) 443-2056
Fax: (952) 236-6429
Cell: (612) 801-2355
Check out our website at http://www.mnrealestateoptions.com for great information on all aspects of real estate, for Buyers, Sellers and Investors
0 votes Thank Flag Link Mon Jan 7, 2013
The only situation I see a solid marketing approach is in a tear down situation where both lots combined will be valued higher, and consequently the property built on them much higher.

I have no idea what the value of your home is, but lets just say for the heck of it both of your homes are priced at 200k independently. Are you seriously thinking you can just combine them and sell for half a million bucks? There is no buyer out there that will do that.

Maybe in truth you are just talking about a lot, and in that case combining them could very well add more value, but in a lot of cases when you can build two houses on two lots instead of 1 that is more profitable.

I don't think no one can give you the final true answer without more information, so I agree with others in that you should interview a couple realtors and hear them out.

Good Luck!

~CHris
0 votes Thank Flag Link Mon Jan 7, 2013
Why not have multiple marketing channels open for you. Market them separately as existing homes / remodel homes / tear down and rebuild homes. Offer a package deal together as well. Marketing properties like this is far more than putting a sign in the front yard and hoping (the post and pray marketing method). With my listings I make hundreds of calls to developers, contractors, brokers, Realtors, etc so they know about this opportunity. This is followed by hundreds more emails. Our listings are seen on thousands of web sites including relocation web sites around the world.

Interview at least three Realtors. Find out how creative they are in their marketing, what their track record is in situations like yours. Ask for references. This could be a unique opportunity for you to realize more money on your sale.
Web Reference: http://www.mywra.net
0 votes Thank Flag Link Mon Jan 7, 2013
Most likely, you could combine the properties and sell everything as one package. From a marketing viewpoint, you would have something that is very unique...two separate, adjacent homes. What this would do to the value of the combined properties, would depend on how many buyers would find that to be appealing. While I can't recall ever answering my phone and having a person on the other end express an interest in two adjacent homes, that doesn't mean that the idea would not appeal to some.

It might be ideal for certain family situations. When I had teenagers, I often wondered if I wouldn't be happier if they lived next door. When my mother was elderly, yet somewhat independent, a property like this would have been awesome, since she could live right next door. After my kids got older and finally move out, they could have moved next door...then if I gave them my snowblower, maybe they could do my driveway. Seriously, it could provide a family with a great asset...."the place next door". A number of people might find it appealing to live in one home and rent the other out. Maintenance and oversight of the rental property doesn't get much easier than being right next door. Having two rental properties next to each other I think would be appealing to investors.

So I think the concept would appeal to some. The key word is "some". Certainly there are more buyers for single family homes. What you have would appeal to people looking to buy an entire duplex or both sides of a twin-home. Actually, what you would have could possibly look VERY appealing to those types of buyers.

I think combining the two properties is going to involve a fair amount of time and effort, especially if either of you have mortgage loans. There really isn't much need to go through the effort of combining the two properties. Without any sort of "official combination of the properties", they could both be marketed and sold as a "package". The "packaged" value of the two properties could be more than the "sum of the two parts".

As others have mentioned, I would recommend a single Realtor. Marketing for something like this is going to require someone thinking "outside the box" a little, which is normal for anything that's unique.

If I can be of further assistance, call me. Mike...763...228...2967
0 votes Thank Flag Link Mon Jan 7, 2013
You should consult with several different realtors as the way I see it, there are several different complications that could arise. Perhaps if you both list with the same realtor and someone wants both parcels, that might be helpful, but if someone only wants one house, the same realtor might not have the same negotiating ability as if there were two separate realtors. You should want a realtor that would be happy to cooperate will a combined sale with the neighbor, but is also aggressively trying to sell your house independently. A separate realtor would also best advise you as to whether to accept any deals that are contingent upon the neighbors house sale. I see a lot of things to be cautious about, so you need good advice. You should also check with the zoning yourself, and check with a real estate atty to consider elements of a contract that involve a deal with two separate sales that have the goal of combining two parcels and remodeling two houses into one.
0 votes Thank Flag Link Sun Jan 6, 2013
Depending on the neighborhood, you may get more value out of marketing the sale as a home, instead of a lot. Let me know if you would like a market analysis of your home, comparing the value marketed as a lot and marketed as a home.
0 votes Thank Flag Link Sun Jan 6, 2013
Generally, you should list the lots independently, but in the remarks section of the listing mention the possibility of purchasing both. The city would have to approve of combining the lots if the buyer was planning on putting the new structure across property or setback lines. Additionally, there may be covenants or restrictions in the neighborhood that may prevent this as well. I represent a custom luxury home builder in the Metro and may have clients interested in a project like this depending upon where the lots are located and pricing. Give me a call if you'd like to discuss this in depth. Hope this gives you a good start...
0 votes Thank Flag Link Sun Jan 6, 2013
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