Vacancy Rates Make Duplexes A Great Investment

said on November 5th, 2012 categorized under: Buying A Duplex

minneapolis duplex investment secretThe secret is out. Minneapolis and St Paul duplexes, triplexes and apartment buildings are great investments.

There are three reasons for this:

  1. Historically low interest rates
  2. Low property values
  3. Extremely low vacancy rates

It’s number three I want to talk about today.

According to a report this morning, Marquette Advisors, who are the folks who compile this data, Twin Cities vacancy rates were up slightly to 2.7 percent for the third quarter. This is .4 percent higher than the third quarter last year.

Of course, this figure is still ridiculously low; especially when you start breaking down those rates by city, and city sections, and their average rents:

Minneapolis- 1.6%, $995

Downtown Minneapolis – 1.7%, $1257

Southwest Mineapolis – 1.6%, $899

North Minneapolis – 1.1%, $872

South Minneapolis – 1.8%, $883

East Minneapolis – 1.5%, $884

St Paul – 2.8%, $910

Twin Cities – 2.7%, $951

On average, rents are up 2.8 percent this year over last; to $951 compared to $925 one year ago.

While things are good, it’s important to remember at some point the market will swing the other way. Vacancy rates will go up, and rents will likely go down.

Right now, however, life is awfully good for Minneapolis duplex investors.