Posted by Rolfe Kurtyka on March 08, 2001 at 21:17:43:
How are things in Beer Town? I’m originally from Appleton, and went to school at Madison (go Badgers). Answers to your questions;
No, I do not believe my tenants have been any different from others. Within my market, I consider my units premium properties. All were solid renovations and have been well cared for. However, I’ve only been at this since 1998. I’m sure I’ll see my share of problems, but the profit margins, especially this market’s appreciation, make that risk worthwhile.
I believe several factors have lead to our remarkable appreciation. We’ve experienced a lot of immigration, and immigrants will buy housing which they can afford. This has created a demand in the inner city. In addition, a substantial non-profit redevelopment effort has had some effect. A strong economy no doubt was a major factor. Finally, the rental market here is tight, with vacancies in some sectors below 1%. This drives up rents, which makes rentals more valuable. Duplexes do not last long on the market.
The MLS, for the most part, is the dominion of realtors. The historic report about appreciation may be available to the public, but in any event no worries; any realtor can pull up a history of “solds” for any area. Fact is, the MLS report about appreciation was old news to investors. We know our market better than most. I’m a broker, and have MLS access at my home office.
Mow and snow is the responsibility of the tenants. This has been a snowy year, and the shoveling sucess rate was no better than fair. Same with mowing. In the spring, the grass can get long. I have no problem taking care of the grass or shoveling once in awhile. It’s a great break from my usual world, gets me outside, and the tenants and neighbors are more likely to be aware of my presence, which is a good thing.
Again, the core neighborhoods of Minneapolis have scene greater appreciation than any other local area. The high number of rental properties in the area makes (made) those properties easier to buy. The risk seems to have paid off. I’ve refinanced properties, pulling out cash to buy others. I deal exclusively in renovations, and only put my own money down once - $10,000 on my first property.
Good Luck, Joel. Rolfe