9804 Hamlet Ln S

Cottage Grove, MN 55016

$280,000F

2 bd · 3.5 ba · 1,947 sqft · Built 1998 · Townhouse · Pending · 7 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,061/mo
• Mortgage (P&I): −$1,468
• Tax + insurance: −$378
• HOA: −$310
• Vac / Maint / Mgmt: −$433
• Net cashflow: $-529/mo
• Annual: $-6,343/yr
• Cap rate: 4.03%
• Cash-on-cash: -8.09%
• DSCR: 0.64
• 1% rule: 0.74%
• Cash to close: $78,400

Investor read

• This is a 2-bed/3.5-bath townhouse listed at $280k.
• At list price, monthly cash flow is $-529 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $187k (33.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $206k (26.4% below list).
• Only 7 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $187k (33.3% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#132 in MN, #2,948 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: cost of living C-, amenities F, commute F.
• South Washington County School District (suburban): math 52% / reading 61% proficiency, ranked #40 of 301 in MN (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 14% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+3.8%/yr); 401 active listings in the ZIP; high-income renter base; 1,405 units permitted in Washington County in 2024 (121 in 5+ unit buildings).
• Washington County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 11y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $164k; list at $280k implies a 70% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate flood risk — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.