Archive for the 'Buying A Duplex' Category

Comments Off on Now Offers Guide’s To Buying And Selling

duplexIf you’re thinking of buying or selling a duplex now or sometime in the future, you may want to click on the “Home” tab for

On the Home page, you’ll find a number of boxes, or areas, with text in them. In about the middle of the page you’ll find one that reads “Considering Buying” and another that says “Thinking of Selling”.

If you click on either, you will get either my Duplex Buyer’s Guide or Duplex Seller’s Guide. I don’t need your phone number, or any of that stuff; just a valid email address so I can send back a copy of the articles.

The reason I send them as a PDF is they’re long. And, if you’re even remotely green minded, it gives you a way to use them as a reference guide without having to print them out.

Feel free to download them. They are absolutely free and I put a lot of work into creating basic duplex buying and selling guides that were easy to read and understand.

I hope you find them helpful.


Comments Off on How Good Manners Can Get You A Great Deal On A Minneapolis Duplex

thank you for calling about that duplexAt the risk of repeating myself, if you have asked me to find you “a great deal on a Minneapolis duplex” and I call, or the Realtor you’re working with calls, please call back.

Even if you’re not interested, call, text or email and say just that.

Not only is the polite thing to do, but, you see, you’re not the only one looking.

There are other agents with other clients who want great deals too. As a matter of fact, we also have other clients who would just love to steal that duplex out from under you.

If you procrastinate, it will cost you money because you will find yourself in a multiple offer situation.

Yes, even in an allegedly bad real estate market, there are a lot of people looking for great deals on duplexes. And the great ones are still few and far between.

Realtors work very hard to unearth opportunities for my clients. And few things frustrate us more than working hard for someone who can’t be bothered to respond.

In fact, it makes us want to quit working for those people and take those great deals to people who get back to us.

Whew. I feel better now. Thanks for letting me vent.

What Not To Do With Your Duplex’s Positive Cash Flow

said on July 18th, 2011 categorized under: Buying A Duplex

Comments Off on What Not To Do With Your Duplex’s Positive Cash Flow

Whitehaven Beach, AustraliaYippee! Now that you have positive cash flow from your Minneapolis duplex, you can take that long overdue trip to Hawaii, right?

Not yet.

Your investment property budget is subject to the same winds as your personal budget. In other words, before you spend your monthly cash flow on fun stuff, you should probably make sure you have enough reserves to weather any storm.

How much is that? Some experts say you should try to have enough saved to cover six months of mortgage payments.

Others focus more on having enough saved to cover any major repairs you might face; like the air conditioning going out on a day when the heat index is officially ridiculous.

And what happens if you have to evict a tenant who’s trashed the place? How much does that cost?

While there is no concrete rule of investing to determine how much you should have in reserves for a duplex investment, it’s probably wise to have the equivalent of several months of the amount of rent your property grosses on hand.

And enough cash to not have to use credit cards to cover major repairs.

Look at it this way — if you never have to use your reserves for a repair, eventually, you’ll have saved enough to buy another property.

After that, maybe you can go to Hawaii.

Duplex Chick Gets A Facelift

said on July 15th, 2011 categorized under: Buying A Duplex


web duplex chick avatarYou may have noticed things look a little different around here.

Well, at least if you go to my home page at, they do.

In May, Duplex Chick was three years old. In Internet time, I think that’s roughly the equivalent of being 50, so it was time for an update.

I have a lot of visitors to and readers of my site who aren’t from Minnesota. And while I certainly have some geographically specific information, most of what I share fits duplex owners everywhere. So, my main home page reflects that.

For example, if you click on my Thinking of Selling or Considering Buying links, you can register to have my basic guides to either sent to your email account. The information in each is true nationwide, and I hope you find it helpful.

However, if you’re interested in more Minneapolis and St Paul specific information, you can either click on the Minnesota link or favorite this address:, you’ll arrive on a page that will allow you to access more Minneapolis and St Paul flavored information.

I hope you understand if there are some glitches here and there. This revamp has been underway for more than a year and in spite of all my best efforts, I’m sure I missed something.

Anyway, I hope you like it. And, as always, if you have any duplex or small investment property questions, just ask. I’ll do my very best to find an answer.

How Congress Could Stop You From Buying A Duplex

said on July 13th, 2011 categorized under: Buying A Duplex

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Congress Impacts Duplex FinancingWhat does the end of the federal government’s fiscal year have to do with buying a Minneapolis duplex?

Your ability to get a loan.

If you’re thinking about owner occupying a duplex, and intend to use FHA insured financing (which requires just a 3.5 percent down payment), it’s important to know two things.

First, barring Congressional action, the maximum duplex loan amount FHA will in insure after October 1, 2011, in Anoka, Hennepin, Ramsey, Dakota, Carver, Chisago, Scott, Washington and Wright counties will be reduced to $311,632.

Meaning if you only have a 3.5 percent down payment, the maximum you can pay for a duplex will be $322,539.

Right now, that figure stands at $483,604, with a maximum FHA loan amount of $467,250.

Second, if you write an offer for a duplex before the September 30th deadline, but intend to close on it some time after that date, you won’t be able to lock an interest rate if the loan amount exceeds the $322,539.

Of course, with the majority of today’s loans being FHA insured, this throwback to 2008 might impact the amount sellers are able to get for their property as well.

Do I think Congress won’t take action on this? No.

Then again, I thought the government of the state of Minnesota wouldn’t shut down either.

1 Comment »

little kittenPeople who are thinking about buying a duplex often ask me what the advantages of occupying investment property are over living in a single family home.

I can think of dozens. But it’s Monday. We all should get some work done.

Here are 6 I can think of off the top of my head:

1. Neighborhood Affordability -Most buyers have their heart set on living in a certain neighborhood.  In Minneapolis, that might be someplace close to the lakes or river, or other walkable amenities. However, many quickly realize the popularity of that neighborhood has resulted in home prices that are out of reach for their budget.

A duplex brings in someone else, namely the tenant who lives in the second unit, to help the owner pay the mortgage by paying rent. For example, if a duplex costs $300,000 to purchase, the tenant is essentially paying for one-third or more of the expenses. For the owner, it’s almost like buying a comparable single family home in the neighborhood for a deep discount.

2. Long-Term Investment – A duplex generates income. When rents increase, so does your income. If you keep the duplex over the long-haul, even after moving out, it will continue to generate supplemental income for you. Best of all, odds are it will never be entirely vacant. Even if a tenant moves out, you should have the other continuing to pay you rent.

3. Tax Savings– Unlike a single family home, improvements you make to the rental unit of your property can be written off as business expenses for your investment. If you paint that unit, retile the floor, update the kitchen…all can help offset your rental income.

4. Greater Mortgage Interest Deduction – While Congress is revisiting our ability to take a tax deduction for the amount of interest we pay on our mortgage, for now, it is still in tact. By purchasing a duplex, which was probably slightly more expensive as a whole than a single family home, you are able to save more.

5. Pet Sitting – OK, I’m checking to see if you’re paying attention. And yes, there are far more important benefits of duplex ownership. Nonetheless, whether you spend your winters elsewhere, or simply go out of town for a long weekend, you may find having another set of eyes watching for maintenance issues (like plumbing) or making sure your cat has enough water to be benefits you might not have convenient access to in a single family home.

6. Flexibility – In a time of increased employment insecurity,real estate market uncertainty and geographic mobility, you may find the ability to rent your duplex in a sought-after neighborhood in the event of your relocation to provides you with a wider range of choices when it comes to having to sell or incur a financial loss by ridding yourself of the property.

Again, there are many more reasons to consider a duplex as an alternative to a single family home.

Why I Won’t Show You A Duplex When You Call

said on June 30th, 2011 categorized under: Buying A Duplex

Comments Off on Why I Won’t Show You A Duplex When You Call

Got UIf you’re thinking of buying a Minneapolis duplex now or sometime in the future, please be prepared to come in to my office, or the office of any Realtor you choose, before you go look at property.

This accomplishes several things.

First, it gives you an opportunity to plan and strategize with the agent the best course of action that suits your short and long term goals as a duplex and investment property owner.

Second, it helps you save time running around, calling numbers on “For Sale” signs and looking at property that doesn’t fit your criteria.

Finally, it’s safer – for both the agent and you.

After all, you’ve just called a complete stranger and asked them to meet you at a potentially vacant house. Neither you nor the agent know the person on the other end of the call.

In the last year, a number of Realtors have been attacked and even killed when they simply answered a call from their sign and went to show the caller the duplex or home they had listed.

And this didn’t happen in New York. Or California.

Try Iowa and Ohio.

I recently lost a prospective client simply because I asked that our first meeting be at my office, rather than at a vacant property at 9:15 at night.

He refused.

I would have loved to help him, but frankly, no paycheck is worth my life.

And no real estate deal should be worth yours.

It may seem inconvenient to meet a Realtor at his or her office before looking at a duplex you want to buy. But it will go a long way toward establishing a long term, successful and happy working relationship for both of you.

Comments Off on Why Minneapolis Duplex Owners Love A Bad Real Estate Market

duplex rent increasesIn recent months you may have heard that both the cities of Minneapolis and St Paul are experiencing historically low rental vacancy rates.

As in below 3%.

Thanks to the foreclosure crisis and tighter lending standards, more prospective home owners have been forced to rent until the both the economy and real estate market improves.

So what does this mean to an investment property owner, duplex buyer or seller?

As always, when supply exceeds demand, prices go up.

In recent months, a number of established Minneapolis duplex and investment property owners told me they’ve been able to increase rent for existing tenants and vacant units for the first time in years.

If you’re a duplex owner thinking of selling, this is good news. If you can keep your rent in line with the market, your property will have more annual gross revenue, which is one of the major components in determining value. The more income a duplex generates, the more it’s worth.

On the other hand, if you’re thinking of buying, this information should give you a sense of urgency. Regardless of whether or not a property is distressed (lender owned or subject to a short sale), values will go up because market rents have increased.

In other words, if you buy before prices increase, you’re more likely to get a bigger return on your investment dollar.

Is Your Duplex Manager On The Most Wanted List?

said on June 9th, 2011 categorized under: Buying A Duplex

Comments Off on Is Your Duplex Manager On The Most Wanted List?

Duplex Manager Criminal BackgroundIf you’re a Minneapolis duplex or investment property owner who’s in the market for a property manager or staff member, what’s the one thing you must do before you hire them?

Do a criminal background check.

The state of Minnesota  requires landlords do a background check on every manager already employed or applying for a job, who will have access to tenants units.

Background checks are done by the superintendent of the Minnesota Bureau of Criminal Aprprehension (BCA).

If an applicant or employee has a conviction for first or second degree murder, manslaughter, second or third degree assault, ciminimal sexual conduct, kidnapping, arson, harassment or stalking, he or she may never be employed as a residential manager.

If someone was convicted or third degree murder, second degree manslaughter, criminal vehicular homicide, fourth or fifth degree assault, theft, burglary, false imprisonment, terrorist threats, they cannot be hired within 10 years of their conviction.

The same holds true if the prospective property manager has been convicted of attempting one of these crimes.

So what if you’ve already hired someone and didn’t do a background check?

You still have the right to run one. Just contact the Minnesota BCA for the form.

And if you don’t?

Imagine trying to explain why you didn’t after your employee commits a crime against one of your tenants.

Comments Off on How Will We Know We’re At The Bottom Of The Duplex Market?

StairwayIf you’re going down hill, how do you know you’ve reached the bottom?

After you’ve stopped going down.

Trying to guess the bottom of the Minneapolis and St Paul duplex market is a lot like running down a hill.

We will only know we’ve reached the bottom of the market after property values have stopped declining.

It’s tempting, in light of the significant home value declines reported earlier in the week, to decide to sit on the sidelines and wait until we think the market has bottomed out.

And yet, once it has, it will be too late. Prices will already be on their way up.

With Minneapolis and St Paul duplex vacancy rates already below 3%, rents are about to go up. And, as duplex values are driven largely by the amount of rent the property generates, prices are sure to follow.

What’s more, while you’re waiting for the bottom, you’re missing out on all the other benefits of owning a duplex, like positive cash flow, principal paydown and tax savings.

If an investment property is purchased correctly, market value fluctuations don’t impact property owners in quite the same way they do single family home owners.

After all, if your Minneapolis duplex is cash flowing and paying its own way, even if it never goes up again in value (which is unlikely), when your mortgage is paid off, your tenants will have bought you a duplex and supplemented your income for years; regardless of what the real estate market did or didn’t do.