Archive for October, 2012

Minneapolis Duplex Market Moves

said on October 30th, 2012 categorized under: Twin Cities Real Est

Comment

duplex market shiftsThere was a shift in the Minneapolis duplex market the week ending October 20, 2012.

At last, more new inventory came on the market during the week than did one year ago.

There were 31 newly listed duplexes, triplexes and four unit buildings that came on the market. This is more than double the 14 that did one year ago. Of these new listings, 67.7 percent were made available for purchase by traditional selelrs. Just 42.9 percent of last year’s sellers had equity in their properties.

Pending duplex sales saw a virtual dead heat year-over-year, with 14 transactions taking place in each. Of those sellers who accepted offers this year, 28.6 percent have equity; up slightly from last year’s 21.4 percent.

While the market share of traditional sellers wasn’t so great as to suggest it would be the case, the sold price for the week in 2011 of $100,277, is significantly below this year’s average off market list price of $187,123.

The single family home market also continued a shift of its own, with new listings down .6 percent,  pending sales up 33.3 percent, for a combined decrease in inventory of 28.5 percent.

With declining inventory and increasing sales, it’s a great time to be a Minneapolis duplex seller.

Minneapolis Duplex Sales Get Better

said on October 23rd, 2012 categorized under: Twin Cities Real Est

Comment

minneapolis duplex sales get healthyThe Minneapolis duplex market appears to be healing.

Now I didn’t say “healed”, or “cured”, but things DO seem to be improving.

For example, for the week ending October 13, there was actually one less Minneapolis or St Paul duplex seller who accepted an offer (29) than there was during the same week last year (30).

This year’s duplex sellers were the winners, however, with an average off-market final list price of $197,983. Last year’s sellers realized an average sold price of $107,739.

Of course, as is usually the case, higher prices are often the result of traditional sellers dominating the market, and this week was no exception, with equity sellers contributing 65.5 percent of the transactions. Last year, just 30 percent of the sales were the result of traditional sellers.

Inventory continued to be tight, which, combined with historically low interest rates, may explain the spike in values. There were just 22 new listings in the most recent data, with a whopping 86.4 percent of them brought to the market by sellers who did not need permission from a banker to sell.

Last year at the same time, there were 39 new listings. Traditional sellers were responsible for just 56.4 percent of these, with banks contributing the balance.

Inventory in the single family home market, however, improved slightly, with new listings up 7.3 percent for the week. Of course, these listings dissipated quickly, with pending sales up 26.7 percent over the year before.

In all, there is a 4.1 month supply of inventory on the market. The market is considered balanced when there is a six month supply. Anything over that and it’s a buyer’s market, less than six months supply creates a sellers market.

I am not ready to pronounce the Minneapolis duplex market cured. But it is well on its way to better health.

Interest Rates Make Minneapolis Duplex Sellers Jump

said on October 22nd, 2012 categorized under: Selling A Duplex

Comment

minneapolis duplex sellers happyI have good news that has many prospective Minneapolis duplex sellers jumping for joy.

No, settle down. Prices aren’t back to their 2006 levels.

But — interest rates may not only help them get there, but help you sell your duplex be appealing to a buyer right now.

Take, for example, two prospective sellers I’ve been working with since last winter.

They have been in their duplex almost a decade.

In that time, their family grew. Now they now find themselves cramped and longing for a single family house with a yard. In other words, they don’t have to move, but they sure would like it if they could.

Last spring, the Twin Cities duplex market didn’t substantiate the price they needed to still have enough money left for a down payment on a home. This was due largely to interest rates for investor borrowers being above six percent; and at that mark, the property just didn’t make financial sense.

Since then, interest rates have dropped approximately two percent. That doesn’t sound like a lot until you realize one percent in interest is equal to one percent of the amount you owe on your loan; per year. So, if you owe the lender $250,000,  one percent of that annually is $2500.

In the case of my duplex sellers, this drop in interest rates means their duplex went from making little, if any, financial sense, to being one of the best deals not yet on the market.

And that will help them finally get the elbow room they so desperately need.

Call me if you’re thinking about selling your Minneapolis duplex. I may be able to give you the same happy news.

Comment

boiler roomAs we head toward winter, many Minneapolis duplex owners who own properties with a single furnace or boiler are likely praying for little snow and unseasonably warm temperatures.

After all, they’re the ones who pay for heat, and mild weather increases their cash flow.

But in the midst of all this dread comes a bit of good news for one boiler multi-family property owners.

While many Minneapolis landlords require tenants to carry Centrepoint Energy’s Service Plus program, which covers repairs to most of the units major appliances and furnace, coverage did not include a heat source that was shared. If it quit working, the duplex owner would have to pay for all repairs.

Turns out Centrepoint recognizes this, and offers a Service Plus plan for multi-family properties of two to six units. At $33.95 a month, it not only covers the furnace or boiler, but also, the water heaters, dryers and stoves for all units on the porperty. Additional appliances can be covered for $5.20 per month for each item.

While this additional expense also reduces cash flow, it may be worthwhile if you have a boiler or furnace nearing the end of its life expectancy.

If you call Centrepoint, know that not every service plus representative is familiar with the program, and you may need to ask them to dig a little deeper to find the police.

Doing so could save you thousands!