Can You Buy A House For Under $100,000 In MN?

Buying a home is a huge step toward your long-term financial security. Even if you can start small, it’s still a better idea than renting in many cases. But what if you only qualify for $100k? Can you even buy a house for that amount these days? Yes. Yes, you can. But there will be some trade-offs.  Rising real estate prices in your ideal area might make it challenging to buy a house pretty much anywhere in the Twin Cities, Rochester, or Mankato metro areas that will need only minimal repairs. But it’s not impossible. Let’s discuss your options if your budget is only $100,000 or less.


Everyone has heard the famous expression “Location, Location, Location!” and when it comes to real estate, the one factor that will matter the MOST when it comes to pricing, is exactly that – where the home is located. Homes that are located in the most convenient, safe, esthetically pleasing areas with excellent schools are typically going to sell for more. Someone who relies on public transportation will value a property next to a mass transit station more than someone who does not. A remote work household will likely pay a higher price for properties away from large commercial and industrial areas.

It’s also important to note that while you can’t change the physical location of your home, neighborhoods are always changing. Keep in mind, whether a location is “good” or “bad” is somewhat subjective as well. And homes in areas that could be considered less than desirable may be excellent investment opportunities. Restoring a 100 year old home can drive up local property values and increase overall neighborhood pride. Community development, new employment opportunities, nearby new construction, and political climates can really shape the vibe of a location. Check out a past blog I wrote What’s in Your Backyard? to learn what can affect property values in an area.

In order to buy a home under 100K that is going to qualify for most financing (so it will not require much work beyond the cosmetic), you will need to consider areas that may not be considered the greatest location by the general population. This may include homes next to gas stations, graveyards, or factories. Another option is that you may want to consider different housing markets with a longer commute.

Market Timing

Two thoughts on this one. First, buying during a strong seller’s market like what we just saw in 2020-2022 is going to be a surefire way to drive up the costs of homes in all price ranges. When there are very few properties for sale and buyer demand is strong, you will be in bidding wars with other buyers looking for a deal. If you home shop during a buyer’s market, you have room to negotiate and time to consider the level of repairs you are willing to do before committing to a new home. Talk to your agent about what areas are more favorable in this market to buyers.

The second thought is the time on the market. If it’s a seller’s market and a home has been sitting for some time, it’s either over-priced or it requires more work than most people are willing to put into it (and the seller is not willing to sell it to an all-cash investor for pennies on the dollar). Talk to your agent about properties that have been sitting on the market longer than normal – you may be able to get a $124,900 home for $99,900 if the seller is motivated enough.

It’s also worth mentioning that I’m not suggesting you wait for a buyer’s market to come around. For starters, no one knows when this will be; you could wait 5-7 years or more. Secondly, property values are continuing to rise in real estate virtually everywhere. If you wait, you may not have to compete with other buyers but the seller’s home will be worth more and your options for under $100,000 will be more limited as time goes on.

Get A Fixer-Upper

This one is a no-brainer. If a rural home isn’t an option, you can still find a home with a desirable location that needs some intensive work. Depending on your credit, there are loan options that will provide additional cash to rehab a home that needs moderate to significant repairs and updating.

Go Small

At a 100K or less price point, a move-in ready 5 bedroom 3,000 sq foot home in the Twin Cities metro is just not a realistic option. Take a look at the homes currently available under 100K and you will see a common theme – condos, townhomes, fixer-uppers, and tiny, tiny homes. Odds are good that if you are trying to buy a home at this price point, it’s likely your first home and you are a single-income household so you may not need a huge home. You can also consider giving up a garage or large lot. There are plenty of small properties including manufactured homes that will make a great starter home so you can start gaining equity and stop paying rent.

Stretch Your Budget

If you find yourself really struggling to find a home you can make work in this price range, consider the following options.

  • Get down payment assistance. Down payment assistance can help cover your down payment and often closing costs, too, which might boost your homebuying budget when added to your savings. See which ones you qualify for here.
  • Find a roommate or cosigner to increase your purchase power
  • Shop lenders – you may get a better loan option, rate, or higher preapproval amount. Also, consider an adjustable-rate mortgage. Nowadays, almost all adjustable-rate loans come with an initial fixed-rate period of five to 10 years. If you think you’re going to be moving again within that period, you can benefit from your ARM’s lower rate with very little risk.
  • Pay down small credit card debts to reduce your monthly expenses
  • Hold off for a few months and save up more cash to put down – Consider Gravy, an app that helps you save for a downpayment on a home. Gravy homebuyers save an average of 2% of the purchase price – that’s $6,000 on a $300k house. Save for a down payment, build your mortgage credit score, learn about the process, and ultimately find and finance your new house––all in one place. Learn more here.

The bottom line is this: You may need to adjust your expectations on the size, location, and property condition. Consider a starter home you can fix up or add on to, gain equity after a few years, and move on into your forever home.

For current homes on the market under $100K, go HERE!

Have a great week!!!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s