602 7th St S

Virginia, MN 55792

$419,900B

60 bd · 50.0 ba · 6,600 sqft · Built 1907 · MultiFamily · Active · 44 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $9,090/mo
• Mortgage (P&I): −$2,202
• Tax + insurance: −$999
• HOA: −$0
• Vac / Maint / Mgmt: −$1,909
• Net cashflow: $3,980/mo
• Annual: $47,764/yr
• Cap rate: 17.67%
• Cash-on-cash: 40.63%
• DSCR: 2.81
• 1% rule: 2.16%
• Cash to close: $117,572

Investor read

• This is a 3×2bd/1ba + 7×1bd/1ba units multifamily listed at $420k.
• At list price, monthly cash flow is $4k ($48k/yr) — positive. Per door: $398/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($9k rent vs $420k).
• It's been on market 44 days — a 3% lower offer ($407k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $407k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#664 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools C-, crime D, health & safety D.
• Watch-outs: built in 1907 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 65 active listings in the ZIP; 639 units permitted in St. Louis County in 2024 (338 in 5+ unit buildings).
• 5 sale attempts since 5y 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 + 3.0% rent growth), your $118k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 17.7% vs local median 7.6% in Virginia — 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.
• At $9,090/mo this rent would consume 203% of the median local household income ($54k/yr) (locally 286% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 44 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1907 — 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.
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.