We’ve all heard about the great deal a neighbor allegedly got when he bought a Minneapolis duplex for half of what it was listed on the MLS for.
And because the media’s told us that it’s a buyer’s market (it is), we think this means every investment property on the multiple listing service (MLS) is worth half of what the seller’s asking for it, right?
Right now, the duplex and single family home markets are like the day after Christmas sale at Macy’s.
In other words, while Minneapolis and St Paul duplexes are selling for a fraction of what they were bringing five or six years ago, the listing price is already half off.
Duplexes that sold for $300,000 in 2005, are now on the market for less than $200,000.
Asking for a 50% discount on top of that is pretty unrealistic.
Unless, of course, there’s a big hole in it.
In April, the average percentage of the original list price received at the sale of a property was 90.5%. That’s of the original price it came on the market at; it doesn’t reflect any price reductions the seller made to help generate interest and an offer.
That tells me that Minneapolis duplex sellers and their Realtors are pretty good at pricing their properties.
Buyers tend to want to try to write a low-ball offer hoping the seller, in a moment of desperation, will jump at their offer.
But they won’t.
They’ve been told buyers were going to that.
And they know market data backs them up.
Yes, it’s a buyer’s market. But remember, when it comes to duplexes, it’s already the week after Christmas sale at the mall.