220 Grace Ave

Iona, MN 56141

$139,000C

5 bd · 2.0 ba · 1,738 sqft · Built 1890 · SingleFamily · Active · 157 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,329/mo
• Mortgage (P&I): −$729
• Tax + insurance: −$166
• HOA: −$0
• Vac / Maint / Mgmt: −$279
• Net cashflow: $156/mo
• Annual: $1,868/yr
• Cap rate: 7.64%
• Cash-on-cash: 4.80%
• DSCR: 1.21
• 1% rule: 0.96%
• Cash to close: $38,920

Investor read

• This is a 5-bed/2.0-bath single-family listed at $139k.
• At list price, monthly cash flow is $156 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $133k (4.4% below list).
• It's been on market 157 days — a 12% lower offer ($122k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $122k (12.0% below list) — sets the bar for market timing.
• In year one you build about $5k of equity ($961 loan paydown + $4k appreciation (3.0% local appreciation)).
• Location reads 61/100 on livability (#725 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety D+, crime D, schools F.
• Murray County Central School District (rural): math 68% / reading 60% proficiency, ranked #28 of 301 in MN (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 3 active listings in the ZIP; 21 units permitted in Murray County in 2024 (0 in 5+ unit buildings).
• Murray County population projected at -14% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $39k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 7, 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

• It's been on market 157 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1890 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.