4425 5th St NE

Columbia Heights, MN 55421

$214,900D

3 bd · 2.0 ba · 920 sqft · Built 1956 · SingleFamily · Pending · 35 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,733/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$405
• HOA: −$0
• Vac / Maint / Mgmt: −$364
• Net cashflow: $-163/mo
• Annual: $-1,955/yr
• Cap rate: 5.38%
• Cash-on-cash: -3.25%
• DSCR: 0.86
• 1% rule: 0.81%
• Cash to close: $60,172

Investor read

• This is a 3-bed/2.0-bath single-family listed at $215k.
• At list price, monthly cash flow is $-163 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $186k (13.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $173k (19.3% below list).
• It's been on market 35 days — a 3% lower offer ($208k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $173k (19.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#215 in MN, #4,509 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+, cost of living A-; Watch: crime C-, schools D+, amenities D-.
• Columbia Heights Public School District (suburban): math 11% / reading 22% proficiency, ranked #291 of 301 in MN (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1956 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.5%/yr); 147 active listings in the ZIP; 14 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 1,083 units permitted in Anoka County in 2024 (134 in 5+ unit buildings).
• Anoka County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Cap rate 5.4% vs local median 3.6% in Columbia Heights — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

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 35 days. Have you received any prior offers? Is the seller open to a 19% concession, seller financing, or rate buy-down credit?
• Built in 1956 — 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.