All Forum Posts by: Marcus Auerbach

What interests you about Racine and Kenosha specifically? We also buy in the surrounding cities and not in Milwaukee, but I would not rank those tow very high. If you want to stay on the south side then maybe look into Greenfield, West Allis etc - plenty of dupelxes there

Thanks for sharing Mike! Great example! And kind of the exception I mentioned in the Subject line: what you are doing is a stark contrast to buying a cheap rental property remote with high hopes for cash flow.

I never see these doors closed up, so your PM might be onto something, but most Milwaukee duplexes have a front and a rear staircase anyway, in that case you really don't need it. Functionally totally useless today, they were meant to putstinky garbage outside, smoke, dry cloths, shake out carpets (before electric vaccum cleaners were a thing). A phone call to the Milwaukee inspection department will give you clarity. 

@Miguel Hernandez it might be too soon for an upgrade. 67K is not enough for 25% down on a decent quad. It may be enough to upgrade to a duplex in a quality area, but that is also tough under the time constraints of a 1031 - Milwaukee is currently the #most competitive market in the US per Redfin Feb 2025 report. Many 1031 exchanges I see will buy a property above fair market value, because that is still better than paying 25% or more in income tax. But that requires a big chunk of cash for the sale, that's why I said it might be too soon.

The Milwaukee major initiated a project called GrowingMKE to increase housing density by allowing mix used, low rise and ADUs in the sea of single family homes. This would create more walkable neighborhoods, think corner bakery. They call it the "missing middle" because Milwaukee is a vast sea of single family homes and then some downtown highrises, nothing in between. I think they model this after Washington DC. It would change the face of the city for sure, also solve the income problem we have with high of miles of infrastructure per household ratio.

TX is a massive growth story for sure and the unemployment rate does not reflect the full picture, because of the sheer volume of jobs in TX, but I still get a kick out of the fact that WI unemployment is 3.2% and TX at 4.1%.

We have been lobbying in Madison for years for zoning that is more dense and cost-effective to build more "affordable" homes, around 400k. In fact the RPA is going to be there today.

This is the rental competitiveness score report from rentcafe. Last year Milwaukee was ranked #3 in the US, now it's ranked #10. We have a chronic housing shortage in Milwaukee regardless of renting or owning, there are not enough roofs. Redfin ranked Milwaukee as the hottest market in the US in Feb with a 20% increase in median sales price. 

https://www.rentcafe.com/blog/rental-market/market-snapshots...

I think the reason we have slipped from #3 to #10 during the winter months is the seasonal slowdown in turn over: most leases have an end date outside Nov-March. My prediction is we will be in the top 5 again by summer. 

@Clare Pitcherthanks for posting, I had not seen the new one. Do you guys already feel spring picking up?

You know it, Bruce. I would agree and say it's a mix of all of the above. And on top February last year was bad, so that makes the difference more pronounced. It's a snapshot compared to a full year data set. So 20% is not the real number, it is probably more like 10% - 12%. I have been talking about this on previous market updates: we should not see double digit monthly increases in the winter off-season. Last year was 8.2% and I would have expected the winter months to be around 3-6% maybe. And one months is an outliar, but 4 months is a trend and I can already tell you from our team's deals that March numbers will come in hot, as well.

For those who are not so familiar: median sold price increase does NOT equal home appreciation. Percentage increases are also higher at the 250k price points than 750k homes which tend to be a lot more moderate. But: after a stable 7-8% appreciation every year for the last 10 this feels like an acceleration and not a very subtle one!

New construction about 2,200 sqft moderately decked out, solid wood cabinets soft close, quarz, LP smart, upgraded flooring and trim package about 550-650. That's with a full 8' basement, poured concrete, but unfinished. We are not seeing a lot of new construction like other States. And our subdivisions are small, 50 units is big for us here LOL. Our local builders are very conservative, many got burnt in 2008.

Ancedotally I can agree: I have two clients who moved from Milwaukee in search of warmer weather (one Phoenix and one to Dallas) and came back within a year because it was just too hot. I work with a lot of relocation clients and when I ask for reasons #1 is family and close #2 is heat, followed by other weather or climate concerns. As an investor that makes me pretty optimistic for Milwaukee and the Midwest in general, because I believe this is an emerging trend and we will see a lot more of that in the next decade.

@James Hamling solid math. Milwaukee is happy to take another 2,000 homes. That's like spitting in a camp fire..