St. Paul Duplex Market Defies Rent Control: Prices Nearly Double in 9 Years

Gary Keller

Over the years, I’ve often heard Keller Williams Realty Founder and Executive Director of the Board say he’d never made a bad real estate investment that time didn’t cure.

I remind myself of that sometimes when my own investments don’t meet my expectations of oment. And today, the St Paul duplex market prompted me to think of it again.

In February of 2016 the median sales price for a duplex, triplex or fourplex in St Paul was $184,671. In the 9 years since, St Paul instituted a rent control policy. Logic would suggest that would cause price growth to stall. Yet, last month the median sales price for the city stood at $360,000. That’s almost double in under a decade.

Viewed from another angle, there were 18 sales in February of ’16 for a total volume of $3,854,732. Last month, 20 small multifamily properties changed hands for a total volume of $7,916,500. In 2016, sellers received offers at 95% of their original asking price. This year’s sellers fared better, netting 99% of their original list number.

Sales were topped by a pristine Summit Hill triplex with 7 bedrooms, 5 bathrooms, and an assumable 2.85% VA loan that helped it net the seller $985,000. A 3 bedroom, 2 bathroom North End house conversion set a high bottom, closing at $170,000. The Summit-University neighborhood lead the way with 4 sales, followed by North End, Thomas-Dale and Dayton’s Bluff with 3 each.

All this isn’t to say St Paul multifamily saw a perfect month.

Sold properties spent a median of 75 days on the market (DOM). This was more than twice as many as in January (33) and nearly that over February of last year (42).

There were 27 new listings that made their debut in the 28 days; the same as last month and down just 2 from one year ago. This new inventory contributed to a total of 77 active listings; up 9 from last year and +52 from 2020. Four of the new opportunities came from the Dayton’s Bluff neighborhood, West 7th, Payne-Penlan and Thomas Dale chipped in 3 more apiece.

A 4 bedroom, 2 bathroom house conversion in the Thomas Dale neighborhood was the value opportunity of the month, which hit the market at $160,000. An 8 bedroom, 4 bathroom fourplex with high rents and original woodwork topped new listings at $1.2 million.

Regardless of what happens in the world, the stock market, interest rates or city council policies, St Paul is proof given enough time, real estate continues to be a good investment.