3108 5th St S #21

Moorhead, MN 56560

$79,900D

2 bd · 1.0 ba · 1,030 sqft · Built 1967 · Condo · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,089/mo
• Mortgage (P&I): −$419
• Tax + insurance: −$134
• HOA: −$350
• Vac / Maint / Mgmt: −$229
• Net cashflow: $-42/mo
• Annual: $-505/yr
• Cap rate: 5.66%
• Cash-on-cash: -2.26%
• DSCR: 0.90
• 1% rule: 1.36%
• Cash to close: $22,372

Investor read

• This is a 2-bed/1.0-bath condo listed at $80k.
• At list price, monthly cash flow is $-42 ($-505/yr) — negative.
• To cash-flow at today's rent, offer at most $72k (9.3% below list).
• Meets the 1% rule at list price ($1k rent vs $80k).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $72k (9.3% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $552 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#143 in MN, #3,111 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, cost of living A-; Watch: crime C-, amenities F, commute F.
• Moorhead Public School District (suburban): math 39% / reading 46% proficiency, ranked #202 of 301 in MN (top 67%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Ellen Hopkins Elementary (math 50% / reading 42%, grade D-, #526 of 857 statewide, top 62%, 643 students, 46% FRL); Horizon Middle School (math 35% / reading 46%, grade F, #144 of 258 statewide, top 56%, 2,158 students, 48% FRL); Moorhead High School (math 44% / reading 59%, grade D+, #124 of 471 statewide, top 27%, 1,937 students, 40% FRL).
• Watch-outs: HOA is 32% of rent.
• Market conditions: Rents rising (+1.4%/yr); 394 active listings in the ZIP; 39 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 269 units permitted in Clay County in 2024 (153 in 5+ unit buildings).
• Clay County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 6y 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 $50k; list at $80k implies a 60% gain — meaningful room to come down on a strong offer.
• Cap rate 5.7% vs local median 3.7% in Moorhead — 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 is only 17% of the median local income ($75k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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?
• Built in 1967 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.