3905 Highway 11

Rainy Lake, MN 56649

$109,900D+

2 bd · 2.0 ba · 1,056 sqft · Built 1965 · SingleFamily · Active · 314 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $957/mo
• Mortgage (P&I): −$576
• Tax + insurance: −$141
• HOA: −$0
• Vac / Maint / Mgmt: −$201
• Net cashflow: $39/mo
• Annual: $466/yr
• Cap rate: 6.72%
• Cash-on-cash: 1.51%
• DSCR: 1.07
• 1% rule: 0.87%
• Cash to close: $30,772

Investor read

• This is a 2-bed/2.0-bath single-family listed at $110k.
• At list price, monthly cash flow is $39 ($466/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $96k (12.9% below list).
• It's been on market 314 days — a 12% lower offer ($97k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (12.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $760 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• International Falls School District (town): math 40% / reading 45% proficiency, ranked #211 of 301 in MN (top 70%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Falls Elementary (math 52% / reading 52%, grade C-, #368 of 857 statewide, top 47%, 393 students, 49% FRL); Falls Secondary (math 32% / reading 41%, grade F, #298 of 471 statewide, top 63%, 501 students, 38% FRL).
• Market conditions: 70 active listings in the ZIP; 26 units permitted in Koochiching County in 2024 (0 in 5+ unit buildings).
• Koochiching County population projected at -27% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 6 sale attempts since 4y ago; this cycle's ask has dropped $10k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.

Questions for listing agent

• It's been on market 314 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• Built in 1965 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.