15 Randy Ave

Melrose, MN 56352

$119,900C-

3 bd · 2.0 ba · 1,216 sqft · Built 2023 · SingleFamily · Pending · 52 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,357/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$200
• HOA: −$260
• Vac / Maint / Mgmt: −$285
• Net cashflow: $-16/mo
• Annual: $-195/yr
• Cap rate: 6.13%
• Cash-on-cash: -0.58%
• DSCR: 0.97
• 1% rule: 1.13%
• Cash to close: $33,572

Investor read

• This is a 3-bed/2.0-bath single-family listed at $120k. Condition is rated good.
• At list price, monthly cash flow is $-16 ($-195/yr) — negative.
• To cash-flow at today's rent, offer at most $118k (2.0% below list).
• Meets the 1% rule at list price ($1k rent vs $120k).
• It's been on market 52 days — a 3% lower offer ($116k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $116k (3.0% below list) — sets the bar for market timing.
• In year one you build about $13k of equity ($829 loan paydown + $12k appreciation (10.0% local appreciation)).
• Location reads 76/100 on livability (#164 in MN, #3,568 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F.
• Melrose Public School District (rural): math 45% / reading 50% proficiency, ranked #142 of 301 in MN (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 31 active listings in the ZIP; 661 units permitted in Stearns County in 2024 (291 in 5+ unit buildings).
• Stearns County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $34k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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 52 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.