Why Buying Homes To Convert To Duplexes Is The Next Big Thing
The Minneapolis housing market has been in a hardcore bull run for nearly 5 years now. Since 2012 the market is up 66%. That is a massive increase. Most of our clients want to be around that 200k number, but that $200,000 price point is getting harder to hit. To get the house that you want it typically takes being at $230,000-$300,000. So what do you do if you cant afford that price point? The solution is to turn your single family home into a duplex.
We have a client that just bought this property. The basement is set up with two bedrooms and a bathroom, living room. The other level has two beds, bath, kitchen and living room. For only $4000-$7000 he could install a really nice kitchenette down in the basement. He could rent this out for $1300 a month and now his mortgage payment just got cut by 60%. That is a big time savings.
In addition the yard is 172 feet deep with plenty of room to build a tiny house or a granny flat. He could build that for around $60,000 and bring in another $1200 a month. Boom! If you do those two investments your mortgage is paid and then some.
I know this sounds dramatic, but if you want to live in south or NE Minneapolis right now that is what is necessary if you cant afford the higher payment. I dont see demand going down anytime soon. South and NE Minneapolis might not be a first time home buyer market anymore, much like Edina is now. In addition, these improvements actually add value to the property. Making those two investments would increase the value of the home by at least $80,000. So if you are looking to buy in south or NE Minneapolis look for places that have good basements that you can convert to Air BnB spots or find lots that have room for granny flats.