912 W Linden St

Fergus Falls, MN 56537

$175,000D+

3 bd · 2.0 ba · 1,980 sqft · Built 1946 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,429/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$233
• HOA: −$0
• Vac / Maint / Mgmt: −$300
• Net cashflow: $-22/mo
• Annual: $-259/yr
• Cap rate: 6.15%
• Cash-on-cash: -0.53%
• DSCR: 0.98
• 1% rule: 0.82%
• Cash to close: $49,000

Investor read

• This is a 3-bed/2.0-bath single-family listed at $175k.
• At list price, monthly cash flow is $-22 ($-259/yr) — negative.
• To cash-flow at today's rent, offer at most $171k (2.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $143k (18.3% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $143k (18.3% 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 $5k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#31 in MN, #969 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, cost of living A+, housing A+; Watch: employment D+, commute F.
• Fergus Falls Public School District (town): math 59% / reading 61% proficiency, ranked #46 of 301 in MN (top 15%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Cleveland Elementary (math 71% / reading 60%, grade B+, #123 of 857 statewide, top 15%, 369 students, 47% FRL); Kennedy Middle School (math 57% / reading 63%, grade B, #25 of 258 statewide, top 9%, 769 students, 43% FRL); Kennedy High School (math 52% / reading 62%, grade C, #64 of 471 statewide, top 16%, 685 students, 33% FRL) — zoned schools average 41% FRL vs 24% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1946 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 118 active listings in the ZIP; 140 units permitted in Otter Tail County in 2024 (48 in 5+ unit buildings).
• Cap rate 6.1% vs local median 3.3% in Fergus Falls — 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.

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?
• Built in 1946 — 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 A-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 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.