3597 Ox Yoke Rd NW

Backus, MN 56435

$214,900D

4 bd · 2.0 ba · 1,008 sqft · Built 2001 · SingleFamily · Active · 66 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,685/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$172
• HOA: −$0
• Vac / Maint / Mgmt: −$354
• Net cashflow: $32/mo
• Annual: $386/yr
• Cap rate: 6.47%
• Cash-on-cash: 0.64%
• DSCR: 1.03
• 1% rule: 0.78%
• Cash to close: $60,172

Investor read

• This is a 4-bed/2.0-bath single-family listed at $215k.
• At list price, monthly cash flow is $32 ($386/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $168k (21.6% below list).
• It's been on market 66 days — a 6% lower offer ($202k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $168k (21.6% 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 66/100 on livability (#493 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety C-, crime D+, employment D+.
• Pine River-Backus School District (rural): math 26% / reading 46% proficiency, ranked #250 of 301 in MN (top 83%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: W.H.A. Elementary (math 32% / reading 47%, grade F, #604 of 857 statewide, top 74%, 416 students, 66% FRL); Walker-Hackensack-Akeley Sec. (math 32% / reading 47%, grade F, #246 of 471 statewide, top 59%, 320 students, 57% FRL).
• Market conditions: 50 active listings in the ZIP; 285 units permitted in Cass County in 2024 (0 in 5+ unit buildings).
• Cass County population projected at -20% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $71k; list at $215k implies a 201% gain — meaningful room to come down on a strong offer.

Questions for listing agent

• It's been on market 66 days. Have you received any prior offers? Is the seller open to a 22% concession, seller financing, or rate buy-down credit?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.