45038 387th Ave SE

Columbia, MN 56651

$143,900D-

3 bd · 1.0 ba · 824 sqft · Built 1890 · SingleFamily · Active · 51 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,003/mo
• Mortgage (P&I): −$755
• Tax + insurance: −$210
• HOA: −$0
• Vac / Maint / Mgmt: −$211
• Net cashflow: $-172/mo
• Annual: $-2,062/yr
• Cap rate: 4.86%
• Cash-on-cash: -5.12%
• DSCR: 0.77
• 1% rule: 0.70%
• Cash to close: $40,292

Investor read

• This is a 3-bed/1.0-bath single-family listed at $144k.
• At list price, monthly cash flow is $-172 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $114k (21.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $100k (30.3% below list).
• It's been on market 51 days — a 3% lower offer ($140k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $100k (30.3% below list) — sets the bar for 1% rule.
• In year one you build about $13k of equity ($995 loan paydown + $12k appreciation (8.7% local appreciation)).
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Fosston Public School District (rural): math 47% / reading 52% proficiency, ranked #134 of 301 in MN (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Magelssen Elementary (math 57% / reading 57%, grade C+, #265 of 857 statewide, top 35%, 343 students, 55% FRL); Fosston Secondary (math 37% / reading 47%, grade F, #222 of 471 statewide, top 50%, 278 students, 54% FRL) — zoned schools average 54% FRL vs 34% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 7 active listings in the ZIP; 42 units permitted in Polk County in 2024 (0 in 5+ unit buildings).
• Polk County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Current owner paid $91k; list at $144k implies a 57% gain — meaningful room to come down on a strong offer.
• By year 3, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate wildfire risk — expect insurance premiums to compound above CPI over the hold.

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?
• It's been on market 51 days. Have you received any prior offers? Is the seller open to a 30% concession, seller financing, or rate buy-down credit?
• Built in 1890 — 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.
• 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.