854 Ash Ave

Westbrook, MN 56183

$125,000D+

2 bd · 1.0 ba · 805 sqft · Built 1940 · SingleFamily · Active · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $950/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$111
• HOA: −$0
• Vac / Maint / Mgmt: −$200
• Net cashflow: $-16/mo
• Annual: $-193/yr
• Cap rate: 6.14%
• Cash-on-cash: -0.55%
• DSCR: 0.98
• 1% rule: 0.76%
• Cash to close: $35,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $125k.
• At list price, monthly cash flow is $-16 ($-193/yr) — negative.
• To cash-flow at today's rent, offer at most $122k (2.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $95k (24.0% below list).
• It's been on market 25 days — a 2% lower offer ($123k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $95k (24.0% below list) — sets the bar for 1% rule.
• In year one you build about $8k of equity ($864 loan paydown + $7k appreciation (5.3% local appreciation)).
• Location reads 74/100 on livability (#229 in MN, #4,836 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, health & safety A+; Watch: schools D+, amenities F, commute F.
• Westbrook-Walnut Grove Schools (rural): math 42% / reading 42% proficiency, ranked #213 of 301 in MN (top 71%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 18 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 29 units permitted in Cottonwood County in 2024 (15 in 5+ unit buildings).
• Cottonwood County population projected to shrink 9% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 7 sale attempts since 24y 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 $8k; list at $125k implies a 1388% gain — meaningful room to come down on a strong offer.
• At projected returns (5.3% appreciation + 3.0% rent growth), your $35k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 5, paydown + projected appreciation supports a ~$33k 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?
• Built in 1940 — 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.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.