Updated: Sep 16, 2019
By one estimate, investors accounted for nearly 10% of all Twin Cities purchases last year. But it's taking more work to make it happen.
Young families aren’t the only ones desperately hunting for deals in today’s competitive Twin Cities housing market. Amid record low home inventories in some areas, investors are peppering some Twin Cities homeowners with letters and postcards nearly every day, offering to buy their house “as-is,” with no repairs.
By one estimate, investors accounted for nearly 10% of all Twin Cities purchases last year — with a focus on low-priced properties also sought by first-time home buyers. Some rehab the homes to sell or rent them out. Others flip the properties to other rehabbers as soon as they buy them.
“I think there’s still deals to be had out there,” said Derek Burington, a rehabber who has been investing in real estate for six years. “It just takes a lot more work than it did a few years ago.”
Burington was once able to find prospects on the open market. But a scarcity of deals led him to become a franchisee with HomeVestors, the entity behind “We Buy Ugly Houses” ads, to find better leads. The number of HomeVestors franchisees in Minnesota has grown fourfold since 2011, to 21 today.
Nationally, investor homebuying reached record highs last year, according to data from the analytics firm CoreLogic. The share of Twin Cities homes purchased by investors has been climbing for several years, though it was higher between 2008 and 2014.
And there appears to be more flipping. Nearly 10% of homes sold in the Twin Cities in early 2018 had changed owners within the prior two years, a figure unmatched in recent history, according to CoreLogic.
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"Intense competition for Twin Cities houses attracts flippers"; By Eric Roper; Star Tribune; Sept 14, 2019