147 SW 3rd Ave

Winnebago, MN 56098

$190,000C-

3 bd · 1.0 ba · 1,415 sqft · Built 1956 · SingleFamily · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,600/mo
• Mortgage (P&I): −$996
• Tax + insurance: −$231
• HOA: −$0
• Vac / Maint / Mgmt: −$336
• Net cashflow: $36/mo
• Annual: $435/yr
• Cap rate: 6.52%
• Cash-on-cash: 0.82%
• DSCR: 1.04
• 1% rule: 0.84%
• Cash to close: $53,200

Investor read

• This is a 3-bed/1.0-bath single-family listed at $190k.
• At list price, monthly cash flow is $36 ($435/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 $160k (15.8% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $160k (15.8% below list) — sets the bar for 1% rule.
• In year one you build about $19k of equity ($1k loan paydown + $18k appreciation (9.4% local appreciation)).
• Location reads 76/100 on livability (#162 in MN, #3,494 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment C-, amenities F, commute F.
• Blue Earth Area Public School (town): math 29% / reading 44% proficiency, ranked #245 of 301 in MN (top 81%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1956 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 10 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 4 units permitted in Faribault County in 2024 (0 in 5+ unit buildings).
• Faribault County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 10y 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 $119k; list at $190k implies a 60% gain — meaningful room to come down on a strong offer.
• At projected returns (9.4% appreciation + 3.0% rent growth), your $53k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

Questions for listing agent

• 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 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?
• 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.