In today’s Minneapolis and St Paul duplex market, the buyers willing to pay the most money are the first time home buyer owner occupants.
This group is typically looking for a duplex that is in great shape, with some updates and a tenant paying enough rent to make their portion of the mortgage and expenses less than they are currently paying to rent themselves.
While cash flow is important to them, most of the time they are looking for a property that will at least break even if they ever move out.
If you are a Minneapolis or St Paul duplex seller, it stands to reason then that you would want to make sure of three things:
- Your property is in good enough condition that it would appeal to a first time home buyer.
- At least one unit is either on a month to month lease or vacant so a buyer can move in (this is usually mandatory for their financing).
- The unit(s) you have rented is at or near market rent. Many landlords are afraid if they raise the rent they will lose good tenants. What many owners forget, however, is if that tenant leaves, they will likely have to pay market rent to someone else. A buyer will still be interested in your property and keeping your tenant if your rent is 5-10 percent below the market rate. However, if the rent is 50 percent below market rate they are going to a) offer you less money and b) raise the rent to close to market value the moment they can.
If you’re thinking of selling your duplex in the spring, you may want to make improvements with owner occupants in mind over the winter. It’s the best way to ensure your duplex sells for the most money possible.