Comments Off on Minneapolis Spring Duplex Market Warming Up
There may be snow on the ground, but buyers and sellers in the Minneapolis and St Paul duplex market believe it’s spring.
In the week ending March 14, 2015, there were 17 duplex sellers who received and accepted offers on the properties they had for sale. Of these, 88.2 percent are owners with equity in the properties. This was reflected in the average off-market final list price of $221,285.
Last year during the same week, 93.3 percent of the Twin Cities duplex sellers were not in distressed circumstances and came away from the closing table with a check in their hands. These sellers averaged a final sales price of $201,313.
There was good news for buyers in the latest market statistics as well. There were 38 new listings for the week. This is up 6 from last year’s 32. Of the new listings, 92.1 percent of this year’s inventory is being offered by sellers with equity. Last year, 87.5 percent were owned by traditional sellers.
In the single family market, the number of Pending Sales rose 14.3 percent, while the number of New Listings rose 20.6 percent.
While February saw a Median Sales Price increase of 9.3 percent to $200,000, there were also some early signs we may be starting toward a more balanced market. Those included the average number of Days on Market ticking up 7.1 percent to 106, as well as the Months Supply of Inventory rising 3.3 percent to 3.1. While still a sellers market, any increase in either of those statistics suggest we may be headed for a market that gives buyers more options.
Comments Off on Are Minneapolis ADUs Really A Road To Riches?
The city of Minneapolis’ recent decision to allow the addition of Accessory Dwelling Units (ADUs) has a lot of people talking to me about finding a duplex that’s perfect for adding one.
After all, wouldn’t an additional unit maximize your cash flow?
Before getting too excited about the ability to add another unit to a property, it’s important to remember the city has rules about doing so.
Perhaps the most important city restriction to know is either the ADU or the main unit has to be owner occupied for the entire calendar year. This restriction is recorded on the deed. In other words, if you sell the property to someone who does not intend to live there, either you or the buyer have to agree to remove all of the improvements you made to have it installed in the first place.
This may result in you having a smaller pool of buyers for your property, as you may find investors unwilling to look at a property that may require that upfront expense and effort.
Only three types of ADUs are allowed: attached, internal and detached. Regardless of where it’s located, the property must be smaller than the principal residential structure. Specifically, the minimum floor area for all ADU’s must be at least 300 square feet. Internal and attached ADU’s may be no more than 800 square feet, while a detached ADU may not be more than 1000 square feet.
In addition to setback and height restrictions, the exterior materials of an attached ADU must match the existing principal structure. You can’t add another door to the front of the property, and any exterior stairway leading to the ADU has to be enclosed. There can be no rooftop decks and balconies can’t face an interior side yard.
If you’re still interested in pursuing adding an ADU to your current duplex or one you intend to buy, it’s important to know you must apply with the city, as well as pay a non-refundable $260 fee. The city will then review your plan for zoning and code compliance.
The passage of the ADU code was intended to be a means to help people age in place, as well as ease our current housing shortage.
While a great idea, it’s equally important to consider what the future consequences to modifying your property may be in the resale market as well. You may find that in the end, it’s not worth the effort or expense.
Comments Off on Minneapolis Spring Duplex Market Is Here
While the weather may not reflect it, the Minneapolis and St Paul spring duplex market has arrived.
Nowhere was this more evident the week ending February 21, 2015, than in the 25 new duplex, triplex and fourplex listings that came on the market. After all, everybody, it seems, wants to wait until spring to sell.
Of these, 88 percent were offered for sale by owners with equity in their properties.
Last year, there were just 18 new listings during the week. However, a whopping 94.4 percent were offered by equity sellers.
Fourteen investment property owners accepted offers on their properties during the third week of February this year. Curiously, even though there is a dwindling supply of distressed property inventory on the market, just 64.3 percent of those transactions will involve traditional sellers. Off market final list prices ranged from $84,900 to $369,900, with the average coming in at $204,778.
One year ago, there were 17 successful Twin Cities duplex, triplex and fourplex sellers during the same week. Curiously, almost the exact percentage, at 64.7, were traditional sellers. Prices ranged from $59,565 to $422,500, with an average sold price for the week of $185,902.17.
The single family home market saw the number of New Listings for the week increase 29.8 percent. Meanwhile, Pending Sales were up too; rising 36.4 percent. Combined, this resulted in the total amount of Inventory on the market decreasing 3 percent.
With next week’s promised thaw, spring will have officially have arrived.