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Updated over 5 years ago on . Most recent reply
Minnesota Owner Occupied Duplex?
My wife and I are planning to move to Minnesota within 3 years. I have a lot of experience on CMBS and multifamily loans but not much on the ownership side apart from a duplex that I managed for my parents in college. Due to the unusually high rent and single family prices I am looking into the idea of purchasing/building a duplex when we move to Minnesota to reduce the monthly mortgage expenses by having a renter supplementing the payment. The hold period would likely be 5 years before we would want to transition to a single family home.
That being said, I have 0 knowledge or experience in Minnesota duplex ownership. The ideal location would be on the west side of the cities as her parents live an hour and a half west of the cities. The budget based on what I have been able to find would be in the $250-350k range.
General Questions:
- What is the ideal financing method for less than 10% down payment? I am interested in FHA given the low down payment requirement since this would be an owner occupied duplex.
- If we were to build the property, what would be the best method to determine layout, costs, etc? Although building the property would be a headache I believe this would allow some piece of mind that everything is brand new and should have minimal maintenance for the first few years.
Minnesota/Twin Cities Specific Questions:
- What area would be ideal to pursue? We are willing to have a 30-45 minute commute to have the right buy BUT the further we are from the city the lower the rent we can ask.
- Are there any lenders you would recommend discussing options/specifics?
- If you have developed properties how stringent are the regulations and would it be better to buy an existing property? I have heard it isn’t developer friendly.
- Any tips/tricks/advice/warnings for this idea in the greater MSP area?
Most Popular Reply
![John Woodrich's profile image](https://bpimg.biggerpockets.com/no_overlay/uploads/social_user/user_avatar/570212/1621492820-avatar-mn_cpa_investor.jpg?twic=v1/output=image/crop=200x200@0x0/cover=128x128&v=2)
When I think western suburbs I think SLP, Hopkins, Minnetonka, Wazyata, Excelsior, Eden Prairie, Chanhassen, etc and it will be very difficult to find a duplex for your price range. These cities have a limited supply and the prices are pretty high as they all have pretty good school districts. Also, with that budget it will be very tough to build anything as land costs in those cities are very high also and construction costs have been increasing....
Sounds like you are willing to have a 30-45 minute commute, I would star there and see what cities it lands you in and start looking at prior sales. That will give you an idea whether your expectations meet the market prices or whether you have to look for other options. Feel free to message me if you are looking for a realtor who specializes in investments or a mortgage broker to discuss your options.