203 16th St SE

Austin, MN 55912

$139,900C-

2 bd · 1.0 ba · 1,120 sqft · Built 1949 · SingleFamily · Pending · 8 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,413/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$169
• HOA: −$0
• Vac / Maint / Mgmt: −$297
• Net cashflow: $213/mo
• Annual: $2,560/yr
• Cap rate: 8.12%
• Cash-on-cash: 6.54%
• DSCR: 1.29
• 1% rule: 1.01%
• Cash to close: $39,172

Investor read

• This is a 2-bed/1.0-bath single-family listed at $140k.
• At list price, monthly cash flow is $213 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $140k).
• Only 8 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#77 in MN, #1,829 nationally) — a professional / high-income tenant draw. Strengths: cost of living A+, housing A+, health & safety A+; Watch: commute F.
• Austin Public School District (town): math 24% / reading 34% proficiency, ranked #267 of 301 in MN (top 89%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Woodson Kindergarten Center (352 students, 71% FRL); I.J. Holton Intermediate School (math 19% / reading 41%, grade F, #199 of 258 statewide, top 78%, 741 students, 68% FRL); Austin Senior High (math 32% / reading 44%, grade F, #278 of 471 statewide, top 59%, 1,345 students, 60% FRL) — zoned schools average 66% FRL vs 46% district-wide (20 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1949 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+11.6%/yr); 190 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 53 units permitted in Mower County in 2024 (0 in 5+ unit buildings).
• 3 sale attempts since 13y 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.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $39k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 8.1% vs local median 4.8% in Austin — 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.

Questions for listing agent

• Built in 1949 — 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.
• 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.