1655 Sheridan Ave N

Minneapolis, MN 55411

$169,900B-

3 bd · 1.0 ba · 1,099 sqft · Built 1920 · SingleFamily · Pending · 18 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,931/mo
• Mortgage (P&I): −$891
• Tax + insurance: −$269
• HOA: −$0
• Vac / Maint / Mgmt: −$406
• Net cashflow: $365/mo
• Annual: $4,384/yr
• Cap rate: 8.87%
• Cash-on-cash: 9.22%
• DSCR: 1.41
• 1% rule: 1.14%
• Cash to close: $47,572

Investor read

• This is a 3-bed/1.0-bath single-family listed at $170k.
• At list price, monthly cash flow is $365 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $170k).
• It's been on market 18 days — a 2% lower offer ($167k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $167k (1.5% below list) — sets the bar for market timing.
• 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 78/100 on livability (#110 in MN, #2,525 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: cost of living C-, crime F.
• Minneapolis Public School District (urban): math 35% / reading 46% proficiency, ranked #217 of 301 in MN (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+7.3%/yr); 132 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 15d on market — plan ~3-4 weeks tenant-placement turnaround); 4,651 units permitted in Hennepin County in 2024 (2,443 in 5+ unit buildings).
• Hennepin County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 16y ago; this cycle's ask has dropped $9k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $62k; list at $170k implies a 174% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 7.3% rent growth), your $48k cash investment doubles in ~8 years — after that, you're playing with house money.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.9% vs local median 3.1% in Minneapolis — 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 38% of the median local income ($60k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1920 — 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.
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.