118 Agency Rd

Mankato, MN 56001

$274,900F

3 bd · 1.0 ba · 1,254 sqft · Built 1964 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,606/mo
• Mortgage (P&I): −$1,442
• Tax + insurance: −$337
• HOA: −$0
• Vac / Maint / Mgmt: −$337
• Net cashflow: $-510/mo
• Annual: $-6,120/yr
• Cap rate: 4.07%
• Cash-on-cash: -7.95%
• DSCR: 0.65
• 1% rule: 0.58%
• Cash to close: $76,972

Investor read

• This is a 3-bed/1.0-bath single-family listed at $275k.
• At list price, monthly cash flow is $-510 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $185k (32.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $161k (41.6% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $161k (41.6% below list) — sets the bar for 1% rule.
• 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 (#133 in MN, #2,970 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, cost of living A; Watch: crime C-, amenities C-, commute F.
• Mankato Public School District (urban): math 48% / reading 56% proficiency, ranked #98 of 301 in MN (top 33%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+8.6%/yr); 359 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 269 units permitted in Blue Earth County in 2024 (154 in 5+ unit buildings).
• Blue Earth County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts 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.

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 1964 — 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 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.