401 2nd Ave NE

Steele, ND 58482

$400,000D+

9 bd · 3.9 ba · 4,950 sqft · Built 1994 · MultiFamily · Active · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,553/mo
• Mortgage (P&I): −$2,098
• Tax + insurance: −$667
• HOA: −$0
• Vac / Maint / Mgmt: −$746
• Net cashflow: $43/mo
• Annual: $511/yr
• Cap rate: 6.42%
• Cash-on-cash: 0.46%
• DSCR: 1.02
• 1% rule: 0.89%
• Cash to close: $112,000

Investor read

• This is a 3 × 3-bed/1.3-bath units multifamily listed at $400k. Condition is rated fair.
• At list price, monthly cash flow is $43 ($511/yr) — positive. Per door: $14/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $355k (11.2% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $355k (11.2% below list) — sets the bar for 1% rule.
• In year one you build about $34k of equity ($3k loan paydown + $31k appreciation (7.8% local appreciation)).
• Location reads 68/100 on livability (#109 in ND) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A-; Watch: schools D+, amenities F, commute F.
• Kidder County 1 (rural): math 35% / reading 40% proficiency, ranked #117 of 169 in ND (top 69%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 2 active listings in the ZIP.
• Kidder County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• At projected returns (7.8% appreciation + 3.0% rent growth), your $112k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$55k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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?
• 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.

Repairs flagged (vision-AI assessment)

• Moderate: kitchen cabinets — dated and in need of replacement
• Moderate: kitchen appliances — dated and in need of replacement
• Moderate: kitchen flooring — dated and in need of replacement
• Moderate: bathroom fixtures — basic and in need of replacement
• Moderate: exterior siding — moderate wear