Selling a Duplex in Minneapolis: Why Condition and Price Point Determine Your Buyer Pool

Multiple duplex owners have recently asked what I would do to market their property to investors and to owner-occupants if they decided to sell.

I found it puzzling. I wondered if they expected me to have two separate marketing plans.

The truth is, the property tells me who the most likely buyer is before it hits the market. That’s because owner-occupants’ expectations for a duplex are usually much higher than those of investors.

Most often, they want a well-maintained property. And while it doesn’t need to look like it was just featured in an HGTV show, it sure doesn’t hurt. Special architectural features, like built-ins, woodwork, or a mid-century modern flair, certainly help too.

Duplexes that appeal to house hackers are usually clean. They have sensible floor plans, some landscaping, and curb appeal.

Often, they are first-time home buyers. They’ve watched their friends buy cute little houses, or fixer-uppers with easy, obvious projects they can do themselves to add value. These buyers have the same hopes and dreams as a home buyer; they just want to secure their financial future by starting with a duplex.

Duplexes that sell for very high prices in sought-after areas also attract owner-occupants. These buyers may be more affluent, downsizing, and/or seeking a multi-generational living arrangement. Finishes and updates usually need to be comparable to the house they left.

Investors?

They are looking for something else entirely. It’s the cash-on-cash return. In other words, how much money would they be able to put in their pockets compared to their down payment? Most investors want a return of 8% or more.

And to achieve that, they most often need to pay a lower price or have more bedrooms. While the property needs to be in reasonable condition, the deciding factor is the amount of revenue it generates. That usually results in a lower sales price than what owner-occupants will pay.

In the end, I will expose a listing to all markets; whether that’s through email blasts, social media, my personal network or networking groups. But it’s the property itself, its location, and the ways it’s been improved and maintained that ultimately determine the type of buyer it’s best suited for.