1761 8th Ave

Newport, MN 55055

$139,900C

3 bd · 1.0 ba · 936 sqft · Built 1983 · Condo · Pending · 104 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,753/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$230
• HOA: −$250
• Vac / Maint / Mgmt: −$368
• Net cashflow: $171/mo
• Annual: $2,047/yr
• Cap rate: 7.76%
• Cash-on-cash: 5.23%
• DSCR: 1.23
• 1% rule: 1.25%
• Cash to close: $39,172

Investor read

• This is a 3-bed/1.0-bath condo listed at $140k.
• At list price, monthly cash flow is $171 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $140k).
• It's been on market 104 days — a 9% lower offer ($127k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $127k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#111 in MN, #2,533 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, housing A+, health & safety A+; Watch: commute C-, amenities F.
• South Washington County School District (suburban): math 52% / reading 61% proficiency, ranked #40 of 301 in MN (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 14% free/reduced lunch — higher-income household profile.
• Zoned schools: Nuevas Fronteras Spanish Immersion (math 47% / reading 47%, grade D-, #492 of 857 statewide, top 61%, 499 students, 16% FRL); Oltman Middle School (math 36% / reading 54%, grade D, #113 of 258 statewide, top 45%, 969 students, 36% FRL); East Ridge High School (math 67% / reading 77%, grade B+, #13 of 471 statewide, top 3%, 2,021 students, 15% FRL).
• Market conditions: 41 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 20d on market — plan ~3-4 weeks tenant-placement turnaround); 1,405 units permitted in Washington County in 2024 (121 in 5+ unit buildings).
• Washington County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 7 sale attempts since 19y ago; this cycle's ask is 7263% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $103k; 36% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 7.8% vs local median 2.9% in Newport — 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.

Questions for listing agent

• It's been on market 104 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 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.