401 4th St NW

Wadena, MN 56482

$79,900C

1 bd · 1.0 ba · 816 sqft · Built 1930 · SingleFamily · Active · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $844/mo
• Mortgage (P&I): −$419
• Tax + insurance: −$105
• HOA: −$0
• Vac / Maint / Mgmt: −$177
• Net cashflow: $143/mo
• Annual: $1,714/yr
• Cap rate: 8.44%
• Cash-on-cash: 7.66%
• DSCR: 1.34
• 1% rule: 1.06%
• Cash to close: $22,372

Investor read

• This is a 1-bed/1.0-bath single-family listed at $80k.
• At list price, monthly cash flow is $143 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($844 rent vs $80k).
• It's been on market 17 days — a 2% lower offer ($79k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $79k (1.5% below list) — sets the bar for market timing.
• 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 67/100 on livability (#433 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: health & safety C-, amenities F, commute F.
• Wadena-Deer Creek School District (town): math 33% / reading 45% proficiency, ranked #235 of 301 in MN (top 78%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Wadena-Deer Creek Elementary (math 42% / reading 32%, grade F, #636 of 857 statewide, top 76%, 449 students, 62% FRL); Wadena-Deer Creek 5Th And 6Th Grade (math 27% / reading 57%, grade D-, #131 of 258 statewide, top 53%, 170 students, 58% FRL); Wadena-Deer Creek Senior High (math 32% / reading 47%, grade F, #246 of 471 statewide, top 59%, 469 students, 50% FRL) — zoned schools average 57% FRL vs 40% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 50 active listings in the ZIP; 52 units permitted in Wadena County in 2024 (0 in 5+ unit buildings).
• Wadena County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts; this cycle's ask has dropped $14k (15%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $34k; list at $80k implies a 133% gain — meaningful room to come down on a strong offer.
• Cap rate 8.4% vs local median 3.3% in Wadena — 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 1930 — 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.