Minnesota
Amazing Minneapolis Investment Property Deals
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Last week I toured several duplexes in NE Minneapolis with a client. All of them were bank owned (foreclosures) and all needed some rehab. I was amazed at how low the prices had gone for otherwise decent buildings in decent neighborhoods.
Two of the three buildings needed around $20k to rehab the bathrooms and kitchens One was priced at $165k and the other was priced at $115k. They were located about 4 blocks from each other. The lower priced building needed some additional work, but I would not say it was NOT $50k worth. It was a typical investment property in NE Minneapolis that had been neglected and the repairs had been deferred for many years. It was an otherwise solid building.
The third duplex that looked at was definitely a find. It was 2 bedrooms up and 2 bedrooms down. Both units needed cleaning and paint, and the upstairs needed carpet. We estimate that if you wanted to get by with the least amount of money invested (in rehab), you could spend less than $5k to get the building rentable again. Best of all, this property was listed for $137k. It had sold 2 years previously for $225k and the owner went into foreclosure recently.
There are amazing deals in all parts of the Twin Cities and even the greater Minnesota area. Now is the time to be a buyer.
Minneapolis & St. Paul Real Estate Market Update
The Minneapolis & St. Paul real estate market continues to be in a slump. Here are the new numbers released for July 2007:
Closed sales are down 2.7% over July 2006.
For the year to date, closed sales are actually down 14.4%.
Percent of original list price received at sale is down 1.9% over July 2006 and is down [...]
The Minneapolis & St. Paul real estate market continues to be in a slump. Here are the new numbers released for July 2007:
- Closed sales are down 2.7% over July 2006.
- For the year to date, closed sales are actually down 14.4%.
- Percent of original list price received at sale is down 1.9% over July 2006 and is down 2.1% year to date.
A few bright spots to be conservatively excited about are.
- The average sale price was up 2.4% from July 2006 versus July 2007.
- Year to date the average sale price is down 0.1%. Although negative, it is considerable stronger than other areas of the country, which are seeing considerable deflation.
- The average days on market until sale is a staggering 127 days, but is actually down from 137 days year to date.
- New listings are down 2.5% year to date.
These numbers confirm what we have been saying: the market continues to be a very strong buyers market. A few positive notes for sellers are that average sale prices were up in July (hopefully they will continue that trend). Lower listings year to date means that inventories of unsold properties are actually declining which will help sellers with both time on market and price.
This information was gleened from a report published by The Minneapolis Area Association of Realtors. See the full report here.
Finding and Buying Investment Properties
There are so many resources in the real estate market today to find and buy investment properties, how do you know which is the best? I can’t speak to any other states, but I will give you my (probably biased) opinion on how to find investment properties in Minnesota.
Initially, spend time figuring out what type of investment [...]
There are so many resources in the real estate market today to find and buy investment properties, how do you know which is the best? I can’t speak to any other states, but I will give you my (probably biased) opinion on how to find investment properties in Minnesota.
- Initially, spend time figuring out what type of investment property you want to own. Are you more comfortable with single family homes or do you like more traditional duplexes and 4-plexes?
- Read my August 9th post about “Where Should I buy Investment Property?”
- Drive around the neighborhoods that you would like to own property in. Make sure you feel comfortable with the area both for safety and for the confidence that you understand the market.
- Use the Internet to familiarize yourself with investment property prices in the neighborhood you have chosen. My website (http://www.mnirea.com/) has an excellent MLS Search capability for Minnesota investment properties.
- After you have done your homework and feel comfortable with your selection of neighborhoods and property types, contact a Realtor that specializes in working with investment property buyers. Most residential real estate agents do not work with investment property on a regular basis. This is a special area of expertise and experience (just like general practitioner doctors don’t often do brain surgery). Additonally, Realtors are traditionally paid by the seller of the property. Therefore, you are able to use a Realtor to help you find the properties that you want for FREE.
Give me a call if you want to discuss your options further.
