507 N 76th Ave Ave W

Duluth, MN 55807

$129,900B-

2 bd · 1.0 ba · 1,364 sqft · Built 1918 · SingleFamily · Pending · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,662/mo
• Mortgage (P&I): −$681
• Tax + insurance: −$332
• HOA: −$0
• Vac / Maint / Mgmt: −$349
• Net cashflow: $299/mo
• Annual: $3,593/yr
• Cap rate: 9.06%
• Cash-on-cash: 9.88%
• DSCR: 1.44
• 1% rule: 1.28%
• Cash to close: $36,372

Investor read

• This is a 2-bed/1.0-bath single-family listed at $130k.
• At list price, monthly cash flow is $299 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $130k).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $898 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#36 in MN, #1,060 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities F.
• Duluth Public School District (urban): math 44% / reading 55% proficiency, ranked #132 of 301 in MN (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Stowe Elementary (math 37% / reading 52%, grade F, #534 of 857 statewide, top 66%, 239 students, 70% FRL); Lincoln Park Middle School (math 26% / reading 39%, grade F, #186 of 258 statewide, top 72%, 524 students, 66% FRL); Denfeld High School (math 32% / reading 42%, grade F, #282 of 471 statewide, top 63%, 940 students, 56% FRL) — zoned schools average 64% FRL vs 39% district-wide (25 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 2.6% of price; built in 1918 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 50 active listings in the ZIP; 639 units permitted in St. Louis County in 2024 (338 in 5+ unit buildings).
• Current owner paid $112k; 16% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 9.1% vs local median 4.9% in Duluth — 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.
• This rent runs 32% of the median local income ($62k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1918 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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.