Housing Market’s “Brussel Sprouts”

Edina Realty Regional Manager Terry McDonough gave a terrific talk at City Lakes yesterday about the advantages — and potential pitfalls — of using contracts for deed in today’s housing market.

In an environment of zero percent interest rates (“ZIRP”) and lots of stealth home equity (something like 2/3 of those over 60 own their homes free and clear), they would seem to be more popular than ever now.

But they’re not.

(Lack of) Comfort Level

One main reason?

Realtors don’t know their in’s and out’s — and therefore aren’t comfortable walking clients through their (considerable) pro’s and (some) con’s.

Example of the latter:  if the home’s underwater . . . skip it.

Realtors’ reluctance to tackle the subject of contracts for deed means that they never gain expertise working with them, so the silence — and CD’s underuse — persists.  

According to McDonough, contracts for deed “are the brussel sprouts of the housing market.  Everyone ‘knows’ they don’t like them, even though they’ve never tried them.”

Thanks to Terry for a lively and clear presentation — and to City Lakes Office Manager Matt Loskota for setting it up (but can you go over that bank estoppel .  . . uh, thing again, Terry?)

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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