Buyer’s Agent: Jason Reed
Seller’s Agent: Jason Reed
We’re celebrating because we had another duplex that The Duplex Doctors listed sell!
This is a beautiful situation and the duplex is located off of Elliott Avenue in Minneapolis.
Elliott Park and Elliott Avenue or one of those gorgeous blocks in Minneapolis. The duplexes and homes are absolutely stunning, and this is a great place to become an owner occupant of a duplex or triplex in Minneapolis.
This was a property that reminds us about the amazing potential that a duplex or triplex provides people. It’s not just about finding a great property – it’s about changing your financial future.
We don’t want to sound like a drone going on about the same thing every time we post – but we are adamant that a duplex or triplex is one of the best financial tools available for people.
Imagine that you could live at nearly no cost while somebody else pays off a property that will eventually turn into a cash producing annuity. Not only will your property eventually get paid off by using other people’s money, but you will be able to use your own cash flow because you’ve freed up that capital. You can put it towards additional properties or other investments in the future.
In a sense, becoming an owner occupier of a Duplex or triplex is a lot like starting your own business, and all you have to do is make sure that you find a good tenant and manage them properly.
Obviously, being a landlord isn’t the easiest thing in the world, but it’s often a simple thing when you are managing a duplex or a triplex because you have the benefit of separation between the units.
One of our business partners brother bought a home in a southern suburb of Minneapolis and tried to rent it out to different people. He did not have separation between the units like he would with the duplex or triplex, instead, he tried to find tenants that would be comfortable sharing a home. The results were disastrous and his plans of financial reward were quickly doused.
Having roommates or a tenant are completely different things when you have separation between the units – and rather than being roommates with somebody, you become a landlord and business owner.
Not only that, but Minneapolis continues to appreciate. While no real estate agent can promise that a duplex or triplex is going to appreciate in value, it’s important to note that rental investment properties are not meant to appreciate and create a capital gain. Duplexes are supposed to be a tax efficient income stream over the long haul.
In this current market condition, it’s very difficult to find extreme values that you could flip for a profit. The amazing thing about duplexes is that you are able to purchase with leverage because the lending company will consider the future rental income when approving you for a mortgage amount. This means that you’ll be able to buy a little bit more home because it’s a duplex.
In other words, you’re going to get approved for a different amount because you’re purchasing a duplex or triplex, but you are also going to be using other people’s money to pay down your mortgage.
Duplexes and triplexes provide tax efficient income streams as well. The net income from a property is going to be seen as passive income, something that is not subject to self-employment taxes. It’s also important to note that the costs associated with your property for management of the rentals, the repairs, and many of the other expenses will reduce the net profit of the property.
One thing that a lot of people don’t think of if they are looking for a home in Minneapolis is that a duplex is quite a bit more affordable than a regular home. Think about it, you’re going to have a tenant living in the other unit paying you rent every month. Anybody who is checked on the Minneapolis rental rates understands that the rent you would get for a nice townhome or apartment like what you’d find in a duplex is going to be about the same price as the mortgage on a large home.
The result is that duplex owners in Minneapolis and St. Paul are often able to live without a housing payment.
Some people like to create a net income from the property as soon as possible, and might consider refinancing when they get more equity in the future. Some people also like to pay off their home sooner, trying to turn their property into a cash machine like an annuity.
We’re also seeing that many retirees are taking a look at duplexes. One of the biggest expenses for people entering retirement age is their housing, and having somebody else pay your rent as a tenant can help reduce that cost. While many retirees like to find a single level townhome or single level home to live in, they might start out there younger retirement years in a duplex and then transition into senior homes and assisted-living as needed. That means when they move out, they will be able to rent out the unit they were living in and it will produce income for them.
We are ecstatic about this sale that we had to go through, and we hope that we will be able to keep helping people take advantage of these amazing financial tools call duplexes or triplexes.
Also published on Medium.