It’s a Seller’s Market: Here’s How to Make a Profit as the Buyer
On HGTV, flipping houses, taking on renovation projects, and making money in real estate looks simple. Of course, the realities of the housing market rarely seem to apply to HGTV, and if they do, you would never know. In the Twin Cities, the real estate market is hot. Demand is outpacing inventory, and listings are selling in days–often for more than the asking price.
In this kind of market, is there any way to make a profitable investment? Yes. If you do it the right way, purchasing a duplex could set you up to live rent-free by renting out one unit while you live in the second unit. In the long run, you could even rent out both units and make a profit.
Listing prices are skyrocketing, but that doesn’t mean that great deals don’t exist.
Finding The Right Duplex
Like any other property, duplexes are not all created equal. There are good investments, but there are also bad investments that could have a ripple effect that lasts for years.
A bad investment will not allow you to live mortgage-free, and it certainly will not allow you to ever make a profit.
But how do you know a bad investment when you see one?
Unfortunately, the reality is that you may not see a bad deal until it’s too late. It can be extremely beneficial to partner with a professional real estate agent who can help to guide you through the process.
While it’s never a bad idea to work with a professional, this becomes especially beneficial in a hot market. Good deals are harder than ever to come by, and buyers don’t have to wait long before they’re given an offer. Some listings are even selling before they ever hit the MLS.
A competent real estate agent can help you to find the deals that you may have missed. But not just any real estate agent will do. As an investor, you will want to ensure that the realtor you choose is investment savvy. If you’re a first time home buyer or new to investment properties, coming alongside someone with industry knowledge will prove to be invaluable.
So how do you find the right kind of property in a market with no inventory?
You have to search like no one else. Most people are familiar with Zillow, Trulia, or Realestate.com. Websites like these offer a great starting point and if you’re serious about making an investment, you should check them regularly to make sure you’re aware of any duplexes that are new to market.
The problem is that the market is competitive. Everyone is checking sites like these to keep up to date with new listings.
So what can you do that others may not be willing to? Try starting a search for duplexes that aren’t even online yet. Get to know other duplex owners by attending a real estate group or by seeking them out in Facebook groups or other online communities. By connecting with others who are in the industry, you may come across unlisted properties that have great potential.
Making a Profitable Investment
But once you have some options in front of you, what else is important to know? You have to know what you can afford to purchase. If you haven’t already done it, your first step is to get pre-approved for a loan. But that’s not the only consideration you have to make! If you’re hoping to profit off of your new investment, you have to consider every expense. How much will a property cost you to renovate? What do you have to pay for garbage, heat, water, and electricity? Are there HOA fees to consider?
It’s important to consider every factor before taking the dive. The worst mistake you can make is to assume an investment is profitable and fail to crunch every number.
Navigating the financial landscape can be tricky. There are various kinds of loans, interest rates, down payments, renovation budgets, utility bills, and more to consider.
That’s where we come in. We want to make buying an investment property as easy as possible, and we want to take the headache out of the process. We are the number one seller of duplexes in Minnesota, and we want to join you in your journey to purchase a duplex that you can turn into a profitable investment.