I'll be moving back to Minneapolis in June 2016 and am doing some preliminary research into multi-family homes. My intention would be to rent out the other units of course and start building my real estate portfolio from there.
Just doing some research in the area, it doesn't look like there are too many multi-family homes in nice neighborhoods within an affordable price range. Do you have any recommendations on the following?
- Continue renting when I return and purchase a multi-family unit in an area I don't intend to live
- Suck it up and live in a neighborhood I am not comfortable with so I can make some cash to eventually move out and on to the next thing
- Are there any decent areas for first time home buyers that I am just completely missing?
- Do you recommend getting in touch with an Agent immediately upon my return to discuss all this?
Thanks, total noob here and looking for some direction.
I'm in a similar boat as you right now. I live in a condo and want to buy a multi in an area where I would want to live. So north Minneapolis is out of the picture. Don't want to live in Saint Paul because I am from the West Metro. I have missed out on a few properties that I really liked after the showing but were scooped up quickly thereafter. A fourplex in New Hope (meh neighborhood) I really liked someone beat me on. But all this was via MLS. As people say on here it is good to find other avenues to get properties before they get on the MLS. The market here has been pretty hot and I have put a few offers on some properties I liked but was outbid on them.
I would recommend getting connected to the local MNreia when you get here and connect with fellow investors (as many on BP suggest) as well as start connecting with realtors that work a lot with investors in the area. There are always properties being bought and sold it's just you have to have the right connections to get the good ones.
One website I really like is Redfin which you can separate the multi families and really check out the areas you really might like to live in. I would love to live in Northeast Minneapolis so I'm looking there. Uptown is too expensive for an investment property unless you can find some one looking to get out of a property.
Another question to ask is, what is your criteria. I'm pretty new to all this but you may want to set a standard of saying what you want the total rent to be for the place you buy. I am looking for a 1.2%-1.6% rent amount. So if the place is 100k I need 1,200-1,600 per month for the other units for the purchase to make sense financially in the present and in the future.
Though June 2016 is only a year away, a lot can change in a year in the market. A property manager I work with said that some of their condos that are now listed at 93k were being sold for 20k two years ago!!!! Woe is me for just getting into this. But for the present time for you I would research areas I would want to live in and connect with realtors and other members of a team I would want to work with (attorney, inspector, etc.) and get some insight from them. There are a lot of helpful people here on BP that are willing to give good advice as well.
I wish the best of luck for you. Hopefully I'll have at least 10 units by the time you get to MN though!
Thanks Daniel for the great advice! Looking forward to seeing how things progress for the both of us!
Daniel and Andrew,
Great posts! I'm new to BP and real estate investing, however I'm living in Northeast and am completing a flip over here and have made some good contacts, so if either of you need a good agent/property manager in the area, I have one and would be glad to facilitate an intro or help however.
The condo story not all that good. A friend of mine owns condos and the association fees are up to $700.00 a month on them. Cuts sharply into profit margin.
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing