The secret is out. Minneapolis and St Paul duplexes, triplexes and apartment buildings are great investments.
There are three reasons for this:
Historically low interest rates
Low property values
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.