1805 13 1/2 St S

Fargo, ND 58103

$329,000F

9 bd · 3.9 ba · 4,032 sqft · Built 1957 · MultiFamily · Pending · 12 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,356/mo
• Mortgage (P&I): −$1,725
• Tax + insurance: −$527
• HOA: −$0
• Vac / Maint / Mgmt: −$495
• Net cashflow: $-391/mo
• Annual: $-4,687/yr
• Cap rate: 4.87%
• Cash-on-cash: -5.09%
• DSCR: 0.77
• 1% rule: 0.72%
• Cash to close: $92,120

Investor read

• This is a 3 × 1-bed/1-bath units multifamily listed at $329k.
• At list price, monthly cash flow is $-391 ($-5k/yr) — negative. Per door: $-130/mo.
• To cash-flow at today's rent, offer at most $260k (21.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $236k (28.4% below list).
• Only 12 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $236k (28.4% 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 $10k of value loss. Plan a longer hold.
• Location reads 85/100 on livability (#1 in ND, #605 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime F.
• Fargo 1 (urban): math 41% / reading 44% proficiency, ranked #28 of 53 in ND (top 53%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1957 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.0%/yr); 208 active listings in the ZIP; 1,218 units permitted in Cass County in 2024 (410 in 5+ unit buildings).
• Cass County population projected at +69% 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.
• Cap rate 4.9% vs local median 2.5% in Fargo — 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.
• At $2,356/mo this rent would consume 48% of the median local household income ($59k/yr) (locally 1782% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1957 — 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.
• Crime grade is F 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.