How Timing The Minneapolis Duplex Market Could Get You Hurt

Have you ever tried to catch a falling knife?

If so, you know one of several things happens: you cut your hand, it falls on the floor, or it stabs you in the foot. And, on the rarest of occasions, you actually catch it without injury.

Trying to time the duplex market is much like trying to catch that knife. Most of the outcomes fall short.

For example, if you’re a buyer waiting for prices to fall to the degree they did in 2008, you could be waiting a long time. The only other time in American history that happened was in 1929. Yes, real estate values often drop during a recession; typically around 5% for each year the economy is in the doldrums. That is not the 27.4% they fell during the Great Recession.

Most of the time, in fact, duplex values go up. So, while you’re waiting to save that 5%, the prices may have risen beyond any savings you might realize.

What if you’re a duplex seller?

It’s the same thing, only in reverse. If you’re waiting for prices to rise, higher interest rates, a glut of inventory, rent control or a recession may thwart your plans. When there was no inventory you had to do very little to your duplex to make it stand out. With a lot of duplexes for sale, you may have to paint, or update, or even agree to bridge the gap between the below-market rent your tenant is currently paying and the amount they should be.

In other words, the best time to buy, or sell, is when you need to.

Please feel free to call me if you’d like to do either.