417 1st St SW

Wadena, MN 56482

$95,000C-

3 bd · 1.0 ba · 1,060 sqft · Built 1895 · SingleFamily · Active · 36 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $981/mo
• Mortgage (P&I): −$498
• Tax + insurance: −$119
• HOA: −$0
• Vac / Maint / Mgmt: −$206
• Net cashflow: $158/mo
• Annual: $1,898/yr
• Cap rate: 8.29%
• Cash-on-cash: 7.14%
• DSCR: 1.32
• 1% rule: 1.03%
• Cash to close: $26,600

Investor read

• This is a 3-bed/1.0-bath single-family listed at $95k.
• At list price, monthly cash flow is $158 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($981 rent vs $95k).
• It's been on market 36 days — a 3% lower offer ($92k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $92k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $657 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#433 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: health & safety C-, schools D+, amenities F.
• Wadena-Deer Creek School District (town): math 33% / reading 45% proficiency, ranked #235 of 301 in MN (top 78%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1895 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 50 active listings in the ZIP; 52 units permitted in Wadena County in 2024 (0 in 5+ unit buildings).
• Wadena County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 8 sale attempts since 18y 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 $40k; list at $95k implies a 138% gain — meaningful room to come down on a strong offer.
• Cap rate 8.3% vs local median 3.3% in Wadena — 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

• It's been on market 36 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1895 — 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.