6 Reasons the Price of a Minneapolis Duplex Doesn’t Determine Whether It’s a Good Investment

One of the most common misconceptions Minneapolis and St. Paul duplex buyers have is that the price of a property determines whether it’s a good investment.

This misperception is often tied to a specific number, for example, “If a duplex is listed for over $X, it’s a bad investment. If it’s below that figure, it’s a good investment.”

However, the truth is price doesn’t determine whether a duplex is a good investment, performance does. And a low price can actually be a sign of a bad investment.

Here are 6 reasons why:

1. A cheap duplex can be cheap for all the wrong reasons:

• The rents haven’t been raised in a decade.
• The tenants are month-to-month and paying below market.
• The boiler predates the Eisenhower administration.
• The roof is one windstorm away from a deductible.
• The income simply doesn’t support the expenses.

2. Higher-priced duplexes often perform better.

A well-maintained $600,000 duplex in a highly rentable neighborhood that brings in $4,200+ per month with separate utilities and updated systems can provide:

• Consistent cash flow
• Lower vacancy
• Better tenants
• Fewer emergency expenses
• Superior long-term appreciation

3. The math — not the price — decides whether it’s a good investment.

A duplex is not a guess. It’s a spreadsheet. What tells you if it’s a good investment may include:

• NOI (Net Operating Income)
• Cap rate (less useful than in commercial properties)
• Cash-on-cash return
• The neighborhood’s rent ceiling
• Utility setup (shared vs. separate)
• Condition and age of big-ticket items (roof, furnace, boiler, sewer line)
• Expense ratio (aim for 35–45%)
• Vacancy trends
• If you intend to live there, whether these numbers help you hit your goal for monthly cash outlay

4. Cheap properties can drain you. Expensive ones can free you.

New investors often target the cheapest property because it feels “safer.” The reality is… the cheapest properties often demand the most cash. They often come with:

• Deferred maintenance
• Old mechanicals
• Low rents
• Higher vacancy
• Tenant issues
• Surprise capital expenses

You are not buying a price tag. You’re buying income generation.

5. Price tells you what you pay. Income tells you what you earn.

When you buy a duplex, the price determines the entry cost — not the return.
No one retires on a cheap price. They retire on strong performance.

6. The market doesn’t care what you paid.

When it’s time to refinance or sell, lenders and future buyers will look at the same things that should have mattered to you when you bought:

• Income
• Stabilized rents
• Expenses
• NOI
• Cap rate
• Condition

They will not care whether you bragged to your friends that you “got a deal.”

At the end of the day, a duplex may be a place to live, but it is also a business. And businesses live and die by performance, not price.