2117 W 4th St

Duluth, MN 55806

$269,000C-

3 bd · 2.0 ba · 1,574 sqft · Built 1905 · SingleFamily · Pending · 12 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,989/mo
• Mortgage (P&I): −$1,411
• Tax + insurance: −$343
• HOA: −$0
• Vac / Maint / Mgmt: −$628
• Net cashflow: $608/mo
• Annual: $7,296/yr
• Cap rate: 9.01%
• Cash-on-cash: 9.69%
• DSCR: 1.43
• 1% rule: 1.11%
• Cash to close: $75,320

Investor read

• This is a 3-bed/2.0-bath single-family listed at $269k.
• At list price, monthly cash flow is $608 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $269k).
• Only 12 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#36 in MN, #1,060 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities F.
• Duluth Public School District (urban): math 44% / reading 55% proficiency, ranked #132 of 301 in MN (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Piedmont Elementary (math 42% / reading 37%, grade F, #604 of 857 statewide, top 74%, 426 students, 63% FRL); Lincoln Park Middle School (math 26% / reading 39%, grade F, #186 of 258 statewide, top 72%, 524 students, 66% FRL); Denfeld High School (math 32% / reading 42%, grade F, #282 of 471 statewide, top 63%, 940 students, 56% FRL) — zoned schools average 62% FRL vs 39% district-wide (23 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 36% at this address vs 50% district-wide (-13 pts) — the specific schools serving this property underperform the Duluth Public School District average; the district grade overstates school quality for this exact location.
• Watch-outs: built in 1905 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 45 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 639 units permitted in St. Louis County in 2024 (338 in 5+ unit buildings).
• 5 sale attempts since 18y 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.
• Cap rate 9.0% vs local median 4.9% in Duluth — 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 $2,989/mo this rent would consume 84% of the median local household income ($43k/yr) (locally 506% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1905 — 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 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.