719 N 16th Ave Ave E

Duluth, MN 55812

$249,000D+

4 bd · 2.0 ba · 1,598 sqft · Built 1925 · MultiFamily · Pending · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,171/mo
• Mortgage (P&I): −$1,306
• Tax + insurance: −$318
• HOA: −$0
• Vac / Maint / Mgmt: −$456
• Net cashflow: $91/mo
• Annual: $1,096/yr
• Cap rate: 6.73%
• Cash-on-cash: 1.57%
• DSCR: 1.07
• 1% rule: 0.87%
• Cash to close: $69,720

Investor read

• This is a 4-bed/2.0-bath multifamily listed at $249k.
• At list price, monthly cash flow is $91 ($1k/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 $217k (12.8% below list).
• It's been on market 25 days — a 2% lower offer ($245k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $217k (12.8% 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 $7k 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.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+8.1%/yr); 50 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); 639 units permitted in St. Louis County in 2024 (338 in 5+ unit buildings).
• 4 sale attempts since 20y 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 $140k; list at $249k implies a 78% gain — meaningful room to come down on a strong offer.
• Cap rate 6.7% 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 40% of the median local income ($66k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1925 — 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.