Rental Property Current Market Conditions
Updated: Nov 13, 2022
Coming off the rates that were established during the pandemic, we are now experiencing an influx in both property mortgages and rental prices. Whether they are looking for a new place to live because their established lease is up, or they are looking to move out from under a family member's roof, the competition for buying will force a lot of individuals to rent. Taking a look at what the market is sitting at in terms of average rates, mortgages, and rent prices will help you understand how to manage your investment portfolio heading into Q4 2022.
Real Estate Recap - Buyers, Renters, Housing Market
With homes being more expensive in closer proximity to the city, people are gravitating away from the city. This is something to keep in mind when attaining properties. Due to the decreased supply of homes over the past two years and the current market rates, many individuals are forced into renting with not a lot of wiggle room. Owning more affordable rental property could help you ensure that you have full occupancy during these market changes.
Generally speaking, the market in the last four months of the year is seemingly the best time to make a move. As home prices and mortgage rates are coming to a plateau, potential buyers are beginning to review the market conditions & plan out their future purchases. Some of these buyers may not be ready to make a move with the increasing prices & rates over the past 6 months so they will look at renting another year or so. We will continue to monitor these changes and their effects on the rental market throughout the end of the year.
Average Rent Prices in Minneapolis
As of October 1st, the median rent price in Minneapolis was $992 for a one-bedroom apartment and $1,282 for a two-bedroom. After seeing that other major cities see an average of $2,180 for a two-bedroom, it is apparent that Minneapolis is more affordable than other major cities.
Average Rent Prices in St. Paul
As of October 1st, the median rent price is $1,095 for a one-bedroom apartment and $1,434 for a two-bedroom apartment. Like any other place, where you are looking in proximity to the city will tell you what side of the median you will most likely land on.
Multifamily Development Conditions
“As of January 2020 [property owners would] be able to build duplexes or triplexes or reconfigure and expand existing houses to add one or two dwelling units”(Bloomberg). The City Council approved this tactic in the hopes of providing more affordable housing to the Minneapolis population.
With more flexibility in both zoning and being able to build multi-family housing, it may be something to consider in terms of having single-family investment properties versus multi-family properties.
For more information on current Multifamily Development Conditions, visit Tactica Real Estate Solutions.
New Rental Property Projects
A new six-story tall residential building that would encompass 65 apartment units and 20 parking spaces has been proposed for that rather busy intersection of Central and Spring.
As of June 2022, there is a large residential building that has been planned to take the Harrison neighborhood by storm. By providing 324 apartment units and 288 enclosed parking spaces, this neighborhood is certain to have an influx of residents with the hope that the cost of living does not prevent them from experiencing this massive building with all the amenities one could ever want and even think of.
In addition to new multi-family housing, as of October 4th- there is a plan for a mixed-use project that will replace an already existing building at 2725 University Avenue SE.
For a full list of upcoming Rental Property Projects, visit The Development Tracker.
Contact Us for Investment Property Guidance
If you’re considering entering the Investment Property Market this year, you’ll want to be mindful of the changes happening in the Residential Real Estate game. With home prices & mortgage rates being rather high, consumers are still looking for more affordable options for the time being. As market conditions have begun to plateau, some buyers are already beginning to re-enter the purchase market. Contact us for more insights on the current conditions!
If you’re looking to sell an Investment Property, we can provide a Complimentary Market Analysis with a full Comp report, advice on repairs & upgrades, advice on timing the sale, & the quality of local competing properties. Even if you’re not looking to sell this year, knowing what the property is currently worth & having a list of recommended upgrades can help prepare you for listing in the future. Give us a Call with any questions or Schedule a Market Analysis today!
Schedule a Zoom Meeting with Grimm Realty Group to discuss your Investment Property needs!
Rental Property Current Market Conditions Sources:
RentPrep: How To Sell A Tenant-Occupied Property
Apartments.com: Tenants' Rights When Selling an Occupied Rental Property
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The content on this page provides general consumer information. It is not legal advice or regulatory guidance. Grimm Realty Group may update this information periodically.
Grimm Realty Group may include links or references to third-party resources or content. We do not endorse the third-party or guarantee the accuracy of this third-party information. All statistics & information are subject to change with market conditions.
Grimm Realty Group is a MN-licensed real estate Broker and does not represent you as your agent unless a representation agreement is mutually signed.