305 Water Ave S

St. Hilaire, MN 56754

$174,900D

3 bd · 2.0 ba · 1,479 sqft · Built 1948 · SingleFamily · Active · 33 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,365/mo
• Mortgage (P&I): −$917
• Tax + insurance: −$215
• HOA: −$0
• Vac / Maint / Mgmt: −$287
• Net cashflow: $-54/mo
• Annual: $-646/yr
• Cap rate: 5.92%
• Cash-on-cash: -1.32%
• DSCR: 0.94
• 1% rule: 0.78%
• Cash to close: $48,972

Investor read

• This is a 3-bed/2.0-bath single-family listed at $175k.
• At list price, monthly cash flow is $-54 ($-646/yr) — negative.
• To cash-flow at today's rent, offer at most $165k (5.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $137k (21.9% below list).
• It's been on market 33 days — a 3% lower offer ($170k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $137k (21.9% below list) — sets the bar for 1% rule.
• In year one you build about $6k of equity ($1k loan paydown + $5k appreciation (3.0% local appreciation)).
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Thief River Falls School District (town): math 39% / reading 47% proficiency, ranked #201 of 301 in MN (top 67%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 2 active listings in the ZIP; 11 units permitted in Pennington County in 2024 (0 in 5+ unit buildings).
• Pennington County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $49k cash investment doubles in ~7 years — after that, you're playing with house money.
• By year 6, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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?
• It's been on market 33 days. Have you received any prior offers? Is the seller open to a 22% concession, seller financing, or rate buy-down credit?
• Built in 1948 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.