Looking for some guidance on how to narrow down to a more specific submarket to research and analyze deals in MN. I've been analyzing deals for a few months now, but find that i don't know enough about the specific areas to truly understand if its a deal or not. This has lead me to think that i should probably narrow my focus on a specific submarket, instead of trying to analyze deals in the entire Minneapolis / St Paul Twin Cities Minnesota area! I'm looking for maximum cash flow, and would prefer something on the north or west side of the city.
To clarify my goals, i'm looking to purchase a small multifamily unit (3-8) within the next 6-8 months. I'd like some value add opportunity, but not a ground up rehabs for my first deal.
Any thoughts on where to start the process? So far i've been trying to analyze overall submarkets by the 1% rule (medium rent/medium home sale in the submarket). Thanks in advance for all the knowledge!
For maximum potential cash flow you will need to look inner city, like north minneapolis and University area of St. Paul or east side. Those areas have good pockets and bad, so that depends on your risk tolerance. Other decent NW areas are Robbinsdale, Brooklyn Center, Columbia Heights. It really depends exactly what you're looking for.
@Todd Dexheimer Thanks for the info! I should clarify, i'm not looking to jump right into the riskier parts of North Minneapolis. I know the returns would be better, but with this being my first rental, I figured it'd be best to avoid the potential headaches that come with investing in those areas. I'll start checking out Robbinsdale, Brooklyn Park, and Columbia Heights, and add them to my search.
How did you go about landing on these 3 suburbs? Is it just from your past experience, or is there a site or process you use to vet potential markets/sub markets for investing?
The inner ring suburbs are just going to provide the best cash flow. Prices are more in line with making money, whereas the far out burbs are going to only make sense if you live in a unit. Don't discount north and south Minneapolis or Northeast Minneapolis. Educate yourself first. There are areas in North and South to stay out of, but there are other areas that are great
I would reach out to @Sam Steadman . He is really knowledgable about areas for first time investors.
I would agree the first ring suburban areas are the best value.