All Forum Posts by: Erika Young

Hi @Account Closed, 

I am still considering N Mpls, but I've come to the conclusion that it must be for cash flow and any future appreciation would just be a bonus. I work in commercial real estate financing, and out-of-state and foreign investors are buying up a lot of multifamily here, which seems to be driving up prices beyond what the market would typically justify. The good news is, many of these properties are best served by "boots on the ground"; without this, distant owners watch them under-perform and dump them for a song (in some cases). I genuinely appreciate your offer to help, and I'll send you a pm. 

I am getting a lot of conflicting advice and information, and I am starting to get a bit frustrated. I want to just DO IT and get it over with, but some of my work colleagues think I am being foolhardy. I have access to some of the best underwriting tools in the business, but I can only learn so much from analysis...I need to set a "first purchase" deadline for myself. I admire all of you so much.

@Byron Bohlsen, I understand and I wasn't trying to be confrontational or presumptuous  at all. You're right: there is an abundance of a certain type of person who resides in N Mpls, and managing a property with non-English-speaking tenants presents its own set of challenges. I was simply speaking to the tendency toward victim mentality some people in that demographic have, and how we as landlords and potential landlords can avoid trouble while maintaining our internal standards for tenants. I hope that my comment can be accepted in the friendly manner in which I meant to present it.

Are there areas in St. Paul that you like? I have little to no knowledge of the area whatsoever. 

Well, I suppose I understand what you are saying about them moving to a neighborhood that I am investing in, but living in (or having once lived in) N Minneapolis doesn't make one a bad tenant, IMO. Destroying property, not paying rent, having additional people on the lease, criminal activity, and the like- that DOES.  If they moved into an area I were investing in and they were a good, paying, quiet tenant well, yes, I would enjoy that very much. 

@Byron Bohlsen, are you saying you wouldn't rent to someone who A) ever lived in N Mpls and/or B) whose primary language wasn't English? I hope you have an airtight, written policy to defend against a potential discrimination claim if those are your (hopefully unstated) preferences. I get it, there are "types" that I'd rather not rent to as well, but I believe there is always a way to screen those people out AND avoid any HUD scrutiny.

As far as section 8 goes, I pay for THEIR housing with MY taxes and no one asked me :), so if it's manageable, I would love to get some of that back into my bank account!

@Laura Thorne, I KNOW what you mean! It's killing me to have so much potential so close a thriving downtown and it's in the gutter! There is a tax lien auction for Hennepin County at the end of April, and MANY of the properties are over north. I hope that's not a sign of other starry eyed investors who threw in the towel...

May I ask how long you've held your properties and if you've noticed any appreciation over the years? Perhaps you have some insight on price trends in the area that you are willing to share...

I was thinking also about section 8 and the rents they would pay for the area. From what I have read, they pay based on market value for the whole of Hennepin county, which seems to be higher than what one might command otherwise in that area.

My day job is in Edina and my husband works in Hopkins. Our kids also go to school this way so I wonder if a house hack over North would be doable, even if I picked a decent area. I may have to drive around over there to make some observations.

Thanks, @Jeremy Rasmussen. May I ask if you accept section 8 at any of your N Mpls properties? If so, how is working with the local agency? Do you self manage or use a PM?

As a newbie, I was thinking of housing hacking for the very first property but I just can't justify it over north, no matter how good the numbers are... I live in the SW suburbs and I don't have the block by block knowledge needed to navigate a successful house hack there. It's just too far outside of my comfort zone. 

It's just so frustrating to see what could potentially be a prime area go to...I don't want to say waste. 

Hi, Steven! I can't seem to @ you on the mobile version...

I was thinking about snatching up a few over the next year or so, but I wonder if I am being hasty just got the sake of starting out. Although I wouldn't MIND the cash flow either way, it would be nice to know appreciation would eventually come. I've looked at some historical sales figures on a few, and it seems to be the only area where there is a markedly downward trend. Then again, my amateur eyes could be missing something!

Welcome, @Kevin Olinger! Nice to see you around...I am trying to gauge interest in a local BP meetup in the TC. I would like to house-hack a duplex in the area. 

@Eric Bate, I literally just posted about N Mpls, but I haven't gotten any responses on that thread yet. I don't see much appreciation there, but the cash flow looks good, esp. if one is interested in going the section 8 route. I would like to ask someone if they have any experience with the local housing authority. I hear both sides of the Sec 8 argument, especially for newer investors, but that cash flow could free up a lot of capital for properties in other areas, I'd think. I feel like it's more of a buy-and-hold, unless some major event/planning turns the area around for upward growth. What do you think?

Feels like those 2% properties are hard to come by our way...

Hello all,

I am just starting to look for deals in the Twin Cities area, and it seems that most buy and hold properties fall well below the 2% threshold in the Metro area and quite a bit beyond. (I will confess here: I am wholly unfamiliar with St. Paul, so I may be mistaken in that market). 

The few feasible (on paper) deals I have located so far seem to be concentrated in N Minneapolis, but it seems that the appreciation there is unlikely, and the property and/or tenant class is unappealing to many. There are some GORGEOUS Victorian homes in that area, and it's so sad to see so many in various states of disrepair. Why isn't this area being revitalized (I suppose some would say "gentrified")? I work in CRE lending, and I have heard about lenders giving pause on otherwise solid deals due to the N Mpls location. I have seen very large duplexes or even 4plexes for a song, that would reach the higher side of 1/2 million purchase price anywhere else.

Is anything in the works for the area? Am I missing something? Is section 8 the best option here, or is appreciation on the horizon?

I look forward to your thoughts!

E