312 5th St NW

Ortonville, MN 56278

$85,000D+

1 bd · 1.0 ba · 888 sqft · Built 1900 · SingleFamily · Active · 50 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $775/mo
• Mortgage (P&I): −$446
• Tax + insurance: −$177
• HOA: −$0
• Vac / Maint / Mgmt: −$163
• Net cashflow: $-10/mo
• Annual: $-121/yr
• Cap rate: 6.15%
• Cash-on-cash: -0.51%
• DSCR: 0.98
• 1% rule: 0.91%
• Cash to close: $23,800

Investor read

• This is a 1-bed/1.0-bath single-family listed at $85k.
• At list price, monthly cash flow is $-10 ($-121/yr) — negative.
• To cash-flow at today's rent, offer at most $83k (2.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $78k (8.8% below list).
• It's been on market 50 days — a 3% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $78k (8.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $588 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#278 in MN) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment C-, amenities F, commute F.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 16 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 3 units permitted in Big Stone County in 2024 (0 in 5+ unit buildings).
• Big Stone County population projected at -23% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 5 sale attempts since 15y 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.
• Climate carrying-cost: moderate wildfire risk — expect insurance premiums to compound above CPI over the hold.

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?
• It's been on market 50 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1900 — 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.