New Member starting out in Duluth, MN

26 Replies

Hello, 

I'm in the early stages of purchasing a multi-family unit in Duluth, MN and begin real estate investing. I absolutely love my job managing a restaurant and hope to steadily increase my cash flow through investing in properties. The goal is to house-hack for a few years and then move onto bigger investment opportunities. I've been reading through forums, listening to podcasts and learning a bit more every day. If anyone has any advice for a beginner I would appreciate it! Specifically in the Duluth market - would it make sense to jump on the Lincoln Park bandwagon? Currently I don't imagine it brings in ideal tenants, but think it could be very lucrative in 3, 5 or 10 years down the line.

I know your market well, since you tossed out the idea of house hacking maybe you might want to stay near campus?  Maybe find a house that you could use as a duplex but really is not a duplex?  Something where you could convert a basement into a bedroom, kitchen, bathroom living space and then rent the upstairs to college kids?  There are not allot of duplexes in the campus area but if you can deal with college kids around you it might work out well.

@Kalli Alexandrou i would just start analyzing as many deals as you can. Go to meetups, if there isn't one close to you then start one or come down to ours. House hacking is the best way to start!

I’m looking in Lincoln Park and Both East and Central Hillside. Hillside is particularly attractive right now with the hospital work that will be happening. Both areas will continue to gentrify. Lots of smart money already there, but still a lot of room for growth. I like the idea of converting to a duplex if you can make it work. There is not much multi family inventory right now, so I am probably going to start mailing to find off market deals. 

Welcome to Bigger Pockets, @Kalli Alexandrou !

You'll find plenty of friendly, knowledgeable people willing to help respond to your questions. Many members are experts in their respective fields related to real estate investing, whether that is real estate brokerage, wholesaling, flipping, buy and hold, lending, self-directed IRA and Solo 401k investing, or tax and legal guidance.

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The site has quite a few tools that can be helpful for new members. For example, if you are looking to connect with other members near you, want to learn from people in a specific area you’d like to invest in, or have a desire to find people interested in certain topics, you could start your search here: https://www.biggerpockets.com/search/users

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Welcome Kalli! 

Sounds like your taking all the right steps. Now time to find your first deal! 

I too am a newer investor and just started my REI journey last year by house hacking a fourplex in Lincoln Park. Feel free to reach out if you want to grab coffee and chat sometime.

- Sam Torvinen 

Welcome, 

It sounds like you're on the right track, if I were to start again I would definitely start with house-hacking! I've met other investors who are in the Duluth market and have been consistently receiving solid cash flow returns. Best of luck!!

-David Honeycutt

Welcome @Kalli Alexandrou ! I occasionally get this question about Lincoln Park and other surrounding neighborhoods from clients and usually offer up numbers based on 12 month appreciation cycles...this is just a starting point, but it can be really helpful when trying to gauge what areas are "up and coming". Lincoln Park, Observation Hill and Central Hillside have all seen great appreciations within the last 1.5 - 2 years. Specifically, within the last 12 months, RPR shows the following appreciation rates:

  • Lincoln Park at 8.29% (just this summer, this number was at 12%);
  • Observation Hill at 13.55%; and
  • Central Hillside at 10.25%.

I agree with @Joe Schmitt when it comes to Central Hillside and the constant redevelopment surrounding the hospitals.  I have seen firsthand increased activity/competition in investor friendly properties in that area.  Personally, I really like Observation Hill and believe that this area is going to represent some of the most valuable real estate/land in the next 10 - 20 years.  In the short-term, rents here are competitive and vacancy rates are very manageable.

Best of luck with your multi-family and house-hack!  Hopefully I will get a chance to connect with you at one of the next meetups.  

If I can help fill in the blanks on any market trend questions, feel free to reach out.

I attend MNREIA meetings on a somewhat regular basis. The networking is good, and some of the content is good. The gurus that they bring in who pitch courses and programs should be taken with a grain (or pound) of salt. It’s worth attending or getting an online membership (much cheaper) to have access to recordings of the meetings. 

@Kalli Alexandrou Yes, there are quite a few meet-ups in the Twin Cities Metro.  If you care to come to one of them @Matt Jennissen & I run one.  Matt lives in the Saint Paul area but owns 2 rentals in Duluth.  Forum rules prevent me from posting the meetups but if you PM me I can send you a list of 4-6 that I like the most.

Originally posted by @Kalli Alexandrou :

Hello, 

I'm in the early stages of purchasing a multi-family unit in Duluth, MN and begin real estate investing. I absolutely love my job managing a restaurant and hope to steadily increase my cash flow through investing in properties. The goal is to house-hack for a few years and then move onto bigger investment opportunities. I've been reading through forums, listening to podcasts and learning a bit more every day. If anyone has any advice for a beginner I would appreciate it! Specifically in the Duluth market - would it make sense to jump on the Lincoln Park bandwagon? Currently I don't imagine it brings in ideal tenants, but think it could be very lucrative in 3, 5 or 10 years down the line. 

Welcome, Kalli! If you're looking for an agent, Jordan DeCaro has been pretty great for me. I have a triplex in Lincoln Park and it has appreciated since I purchased it in 2016, a decent amount. I also have a single family on 4th Street, near Portland Square. The great thing about Duluth right now is you can get into a property for relatively cheap, but the rent is high enough to make it lucrative. I also started working with Heirloom Property Management and have heard good things about them.

So I guess to answer your question, I think investing in Lincoln Park makes sense, as property prices are low enough for someone to get started. Ideal tenants? Yeah, not so much but I have had some pretty decent ones so far. 

Best of luck to you! 

Kalli,

Good luck on your adventure! The only advice id give is to start with a house-hack, like you had mentioned. I have not looked at any houses in the Lincoln Park neighborhood, I have mainly focused on East Duluth and the UMN Campus area. This area is tricky though because not much comes on the market, and if it does its generally sold quick. Because of this I am starting to consider looking in the Lincoln Park neighborhood. 

Reach out if you have any questions or would want to grab coffee. 

Cheers!

Hey Kalli!  

Good luck, Duluth is a great place to invest!  Happy to grab coffee if you'd like sometime and help where I can!  Heirloom will be hosting a regular local investor focused meet-up starting in May when we move into our new office space.  We've already got a series of guest speakers and sponsors lined up.  I'll be sure to message you closer up, but at least there is a local event for investors on the horizon!

Cheers!

@Kalli Alexandrou

Good luck to you on your hunt for a great house hack! I just finished my second deal in Superior and have been looking at the Duluth market lately. I'm not that familiar with Duluth real estate and this post answered a lot of questions for me so thanks for posting!

Hello! It’s nice to see that there are so many TwinPorts investors active on here! My wife and I are very fresh real estate investors in Duluth as well. We are currently on track to close on our first property in April, which is a 3 bed 1 bath each side duplex in the Morgan Park neighborhood that we are going to House Hack. The comps in the area are tricky to identify, but hopefully our analysis is right. 

Does anyone in Duluth coordinate any meet ups? 

My Fiancé and I are closing on a Quad in east hillside in early April. We’re house hacking too! I don’t have a lot of availability, and I work mostly in vacant land, but I’d be happy to do some small/1:1 meetups for a beer or coffee with any fellow investors. 

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