There are a few things to consider in your decision; is it too difficult being a long distance landlord, is the property in good condition or does it need repair, what is the current competition, and how would I have to price it to compete given its condition.
Not knowing the specifics of your situation, in general, if a property is priced well it will sell. The "Nordeast Minneapolis" area has a lot to offer; a vibrant arts community, great restaurants and local businesses. When and if you decide to sell, make sure you select an agent who is familiar with all the best the area has to offer.
Sandy Erickson Real Estate Team
Keller Williams Integrity Realty
It certainly isn't as pleasant to move into a new home during winter in the midwest, but many people do it every day. I have dozens of buyers who are patiently waiting, because sellers don't want to list their houses in the winter.
In my opinion, the real estate slowdown in winter, is a self fulfilling prophecy.
You want to get connected to an agent that works with a lot of investors- they are hungry for duplexes! Our team has a lot of investor clients looking for these properties. I would love to discuss some details with you for your consideration. Let's chat! 612.226.6748 or email@example.com
That being said, the trend for people moving into the city of Minneapolis and Northeast is on a huge upswing. Rents have increased by 15% in Northeast in the past 2 years. If this trend continues, and it likely will, the values could go higher.
The increase in values could be deterred by the interest rates. I am seeing my sellers receive higher prices for properties recently because of the low inventory. If you need help feel free to call me at612/554/3199 or visit Theduplexdoctors.com for good info on the market.
I am and Minneapolis Remax agent. Locally its a sellers market right now.
I suggest interviewing a couple agents and if you decide to list your duplex for sale...pick the agent that you are most comfortable with.
Cody Anderson, MN Licensed Realtor
Metropolitan Home Team
NE Minneapolis was one of the areas in the Twin Cities that was late in seeing run ups in values in the boom years of real estate. So the values of homes in NE haven't taken as much of a tumble as homes in 'hotter' neighborhoods of Minneapolis. NE has always been a more affordable and safer area when compared to other parts of Minneapolis
If you are planning on selling, put it on the market early in the spring as our selling season is rather short (done by October). You might also need to have one unit empty if you want to sell to an live in owner/investor.
Home could sit on market vacant longer than you like with extremely low offers.
Have you consider selling property to either one of tenants?
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
You are not wrong about it being a tough time to sell. But, if your expectations are realistic, you won't be disappointed. The trouble arises when sellers expect that THEIR property is better than any other property of it's type in the area. Find an agent that you trust who will help you "keep it real". Your property will most likely not sell for what it might have sold for at the height of the market in '05 or '06.
That said, if your agent does their homework, they will be able to provide you with evidence about what prices are doing for similar properties in the area of your property, so YOU will be able to decide about a realistic price. It's my approach when working with buyers and sellers that THEY are the decision makers. Sometimes I agree with their decisions and sometimes not, BUT, I won't work with a buyer or seller who is TOO unrealistic. It's your choice about where to price it (since it's the price that will sell it). Don't lose sight of realistic expectations.
I'm a Realtor and duplex owner living and working in NE for the past 10 years. Any investor purchasing your property is going to be basing their purchase strictly on getting a good deal financially. Any owner occupant buyer could be more concerned with updates as they are likely purchasing a duplex as a way to sibsidize their living and probably don't have the cash to make updates on their own. Without seeing it and knowing the rents it's hard to determine what would be the right course of action for you (which honestly could be to hold it for now). I can tell you that the spring market actually starts about now, so if you do want to sell, the sooner you list it the better. Happy to answer any more specific questions if you want to contact me.
Good luck to you!
Keller Williams Integrity
Being an absentee landlord is a major hassle. Good luck in your sale. NE Mpls is a good rental market. I sold several duplexes there last year and all went quite quickly.
Steele V. Propp
Schatz Real Estate Group
The news is that Fannie and Freddie are about to announce a change to their lending policy. Currently, if you had a foreclosure 3 years ago or more, you are elligible to be approved for a mortgage. They are going to change that to 10-12 years. I am hoping for 10, but I heard last week from a "big shot" that they are going to say 12. We don't know. But what this means to you, in selling this property to an investor, is that the investors are going to know that this means they will have a solid rental unit, totally occupied, for many years to come.
Back to where we were . . . .
With all these things I just shared about the fact that renters are buying, and the prices are low, and all these people being displaced to rent again means this: there will be a LOT of renters that are used to OWNING a home that will be forced to rent. They are not going to want an apartment after living in a home. They will want to rent a HOME. So the marketability of your duplex has increased significantly for these investors who know this.
One last thing, and I am dealing with this with two different sellers in this area: there have been a lot of foreclosures in these areas that have kept the prices down. These have slowed down and the prices are picking up. But we are anticipating more of them this summer.
My bottom line answer: I would get it on the market sooner than later, and that is IF you choose not to ride this out and rent it for a while.
Any questions . . . I am always here for you.
As usual you are hearing some great answers from some of the best realtors in the Twin Cities. Let me add to that.
One of the most imporatant factors in deciding when to sell is your motivation. It seems clear to me that your motivation is not to continue owning a rental property this far from home. But as already mentioned, if your equity position is solid on this property and you hired a reputable property manager, you surely could enjoy many years of positive cash flow, great tax benefits, and ultimately in the end when you do choose to sell it, you would gain more equity yet on the back side. I am, again, assuming you both know that and have thought about that, but your choice is to sell it and get the equity now.
The market for investment properties is strong. And I would add that the NE Mpls market is one of the strongest for multi-family investors. And adding again to that, if you have two decent renters in there that are paying their rent on time, you have a very strong asset that investors want. A duplex with renters that are under contract and paying their rent makes for a very strong and saleable property. You will lose a few buyers that want to purchase it only as a owner-occupied, but that's okay, because you will gain more buyers on the other end that say, "This is great! I don't even have to find buyers immediately."
You specifically said you want to sell either in the spring or summer. Then followed that up with saying that you feel that you are not "sure this is a good time to sell". Let me tell you, I could right now either bore you to death or thrill you to life with a pile of statistics. I have had a number of classes and seminars I went to specifically to listen to a number of experts pour over stats and tell me what THEY see going on under the covers. These people have been looking at stats and trends and the economy and our market for dozens of years, Tanya. And I always guide my business appropriately.
But I am not going to share all the stats here. I can later if you contact me. But let me say that things have sort of "exploded" already. The buyers and also the INVESTOR buyers have suddenly figured out that the market is not as bad as they thought. They finally realized we hit bottom about 13+ months ago and the prices are increasing . . . the inventory is down to almost a "normal" level . . . the rates are excellent but starting to inch up. The bottom line, Tanya, is that the home affordability index here is the best it has been in over 50 years! It is a great time to buy. Also, the lenders are loosening their tight guidelines and just last week I got word of two major changes, and one involves investors. The buyers are coming out of the woodwork earlier than normal and the properly priced properties are gone as fast as they hit the market.
I will state this: right now is an excellent time to buy and maybe . . . just maybe . . . better than the summer for you as a seller, anyway. The reason? Statistically sellers respond to market change 2-3 months AFTER the buyers do. So I am anticipating a lot more properties coming on the market 3-5 months down the road once sellers figure out that the market is better than they heard about on CNN and what they read in the newspaper. I can tell you that I literally have more investors talking to me right now and gearing up to buy NOW rather than later . . . .than I have had over the past 9-12 months. And I like that. They are just more savvy than non-investors and they see that. And here is the funny thing . . . and I hope you can appreciate and benefit from this.
These investors, by the way, have had all the opportunities in the world to look at the "deals" out there. The foreclosures, the short sales, the HUD homes, etc. The two I have talked to just today that are both getting approved for loans literally as I am writing this, do not have any desire to buy a "deal" that needs a bunch of work and sink more money into it. They want a home sold by John Doe, that they can walk into, maybe do some painting or updating and then rent it out tomorrow. My opinion is that you will get more money for your home in this spring market, than you would in the summer market. It's my opinion, but it is based on a lot of statistics and facts. And you did request advice from some experts up here, right?
In addition to all this, I pulled up some rental information and poured over some rental stats. For the first time in decades, there is going to be a huge swing. To keep it simple, you already know that it is better to buy/own than rent, right? Okay, because of the mortgage rates being so low, many people that could not afford a home have or are buying now. Now take into consideration the number of people who have lost their homes and have to rent. And combine that with some news that has not been officially released but it will be shared soon: (I have to do a second post - ran out of room)
If it fits your financial position, selling in a known market is better than hedging on the unknown future.
Especially when we have a future, as viewed by many prognosticators, as less than rosy.
Statistically speaking the overall median sales price for NE Minneapolis has remained relatively stable over the course of the last 12 months, but depending exactly where your property is located and condition etc. the market price could be impacted one way or the other. As I'm sure you've encountered in AZ as well as across the country, the real estate market has seen decline over the last several years. Depending upon the cost for you to maintain the property and if you currently have a mortgage on it or not could most definitely be determining factors in whether or not it would make financial sense for you to sell it at this time. Unfortunately no one has a crystal ball so it is difficult to predict exactly what turns the market is going to take in NE Minneapolis in the near future. Spring or summer would be a better time as far as time of year is concerned, as typically that is when you would see any market increase. Considering the property is fully rented should be a marketing factor if it would cash flow for an investor and would aid in marketability. Additionally, mortgage rates are still low and for a buyer requiring financing to purchase that is a marketable factor as well. With that said I would look at the financial benefits of holding vs. selling to see what makes the most sense for you from a management stand point. If you are losing money, it may make most sense to sell and cut losses as market recovery could be a few years coming yet...hopefully sooner. If the property should require any city required maintenace or extensive updating that will impact marketability and price as well, so if you need a definitive answer I would recommend you have someone complete a market analysis on the property to pre-determine the estimated selling price if you are unsure. Let me know if I can be of further assistance with a market analysis or any other specific questions you may have!
The fact that the duplex has renters could be a strong draw for investors looking to increase their holdings. Unfortunately, those are rather rare these days unless the price is right. Iâ€™ve read reports that there will be another wave of foreclosures this year which will continue to bring property values down. I agree with Steven when he said the sooner the better in terms of selling it. It will also relieve you of the stress of caring for the property.
You could consider is to hold on to the property, however, either as an investment for yourself or to sell it once the market is stronger for sellers. Since youâ€™re in Arizona, I would recommend looking into hiring a property management company to take care of all the details. There will obviously be a cost for this service but if youâ€™re investment is little to none than you could keep the property and the monthly income it produces while not having to do much on your end. I use a property management company for one of my rental properties and it works great. I simply get a check in the mail from them every month. They do the rest.
If you don't mind hanging onto it as an investment for 5 or more years, since it's rented then perhaps hanging on until appreciation comes back may be the right answer.