1119 W Front St

Albert Lea, MN 56007

$97,000C+

3 bd · 2.5 ba · 984 sqft · Built 1898 · SingleFamily · Pending · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $998/mo
• Mortgage (P&I): −$509
• Tax + insurance: −$99
• HOA: −$0
• Vac / Maint / Mgmt: −$209
• Net cashflow: $180/mo
• Annual: $2,165/yr
• Cap rate: 8.53%
• Cash-on-cash: 7.97%
• DSCR: 1.35
• 1% rule: 1.03%
• Cash to close: $27,160

Investor read

• This is a 3-bed/2.5-bath single-family listed at $97k.
• At list price, monthly cash flow is $180 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($998 rent vs $97k).
• It's been on market 17 days — a 2% lower offer ($96k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $671 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#274 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools C-, employment D+, amenities F.
• Albert Lea Public School District (town): math 30% / reading 40% proficiency, ranked #258 of 301 in MN (top 86%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1898 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 150 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 16 units permitted in Freeborn County in 2024 (0 in 5+ unit buildings).
• Freeborn County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 8.5% vs local median 4.0% in Albert Lea — 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.
• This rent is only 17% of the median local income ($69k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• Built in 1898 — 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.
• 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.