529 5 1/2 St NW

Elk River, MN 55330

$335,000F

3 bd · 2.0 ba · 1,740 sqft · Built 1976 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,030/mo
• Mortgage (P&I): −$1,757
• Tax + insurance: −$426
• HOA: −$0
• Vac / Maint / Mgmt: −$426
• Net cashflow: $-579/mo
• Annual: $-6,947/yr
• Cap rate: 4.22%
• Cash-on-cash: -7.41%
• DSCR: 0.67
• 1% rule: 0.61%
• Cash to close: $93,800

Investor read

• This is a 3-bed/2.0-bath single-family listed at $335k.
• At list price, monthly cash flow is $-579 ($-7k/yr) — negative.
• To cash-flow at today's rent, offer at most $233k (30.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $203k (39.4% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $203k (39.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#265 in MN) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Independent School District 728 (suburban): math 56% / reading 60% proficiency, ranked #37 of 301 in MN (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 14% free/reduced lunch — higher-income household profile.
• Zoned schools: Lincoln Elementary (math 33% / reading 51%, grade F, #579 of 857 statewide, top 69%, 557 students, 46% FRL); Vandenberge Middle School (math 36% / reading 47%, grade F, #138 of 258 statewide, top 55%, 512 students, 27% FRL); Elk River Senior High (math 60% / reading 57%, grade C, #56 of 471 statewide, top 12%, 1,637 students, 22% FRL) — zoned schools average 32% FRL vs 14% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 457 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 5d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 334 units permitted in Sherburne County in 2024 (58 in 5+ unit buildings).
• 5 sale attempts since 11y 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 $170k; list at $335k implies a 96% gain — meaningful room to come down on a strong offer.
• Cap rate 4.2% vs local median 3.3% in Elk River — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 1976 — 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.
• Schools are A-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.
• 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.