320 W 3rd St

Morton, MN 56270

$119,900D

2 bd · 1.0 ba · 858 sqft · Built 1963 · SingleFamily · Pending · 170 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $862/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$153
• HOA: −$0
• Vac / Maint / Mgmt: −$181
• Net cashflow: $-101/mo
• Annual: $-1,210/yr
• Cap rate: 5.28%
• Cash-on-cash: -3.60%
• DSCR: 0.84
• 1% rule: 0.72%
• Cash to close: $33,572

Investor read

• This is a 2-bed/1.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $-101 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $102k (14.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $86k (28.1% below list).
• It's been on market 170 days — a 12% lower offer ($106k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $86k (28.1% below list) — sets the bar for 1% rule.
• In year one you build about $8k of equity ($829 loan paydown + $7k appreciation (6.1% local appreciation)).
• Location reads 64/100 on livability (#613 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety D+, crime D, schools F.
• Redwood Area School District (town): math 39% / reading 46% proficiency, ranked #207 of 301 in MN (top 69%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 2 active listings in the ZIP; 17 units permitted in Renville County in 2024 (0 in 5+ unit buildings).
• Renville County population projected at -28% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $59k; list at $120k implies a 103% gain — meaningful room to come down on a strong offer.
• By year 5, paydown + projected appreciation supports a ~$36k 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 170 days. Have you received any prior offers? Is the seller open to a 28% concession, seller financing, or rate buy-down credit?
• Built in 1963 — 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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?