1429 31 Spartan Ave

Albert Lea, MN 56007

$259,000D

4 bd · 4.0 ba · 2,276 sqft · Built 1972 · MultiFamily · Pending · 220 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,386/mo
• Mortgage (P&I): −$1,358
• Tax + insurance: −$432
• HOA: −$0
• Vac / Maint / Mgmt: −$501
• Net cashflow: $95/mo
• Annual: $1,141/yr
• Cap rate: 6.73%
• Cash-on-cash: 1.57%
• DSCR: 1.07
• 1% rule: 0.92%
• Cash to close: $72,520

Investor read

• This is a 2 × 2-bed/2.0-bath units multifamily listed at $259k. Condition is rated fair.
• At list price, monthly cash flow is $95 ($1k/yr) — positive. Per door: $48/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $239k (7.9% below list).
• It's been on market 220 days — a 12% lower offer ($228k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $228k (12.0% below list) — sets the bar for market timing.
• 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 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: employment D+, amenities F, commute 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.
• Zoned schools: Sibley Elementary (math 37% / reading 37%, grade F, #636 of 857 statewide, top 76%, 282 students, 64% FRL); Southwest Middle (math 19% / reading 38%, grade F, #210 of 258 statewide, top 81%, 474 students, 62% FRL); Albert Lea Senior High (math 23% / reading 37%, grade F, #345 of 471 statewide, top 74%, 1,218 students, 53% FRL) — zoned schools average 60% FRL vs 40% district-wide (20 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 154 active listings in the ZIP; 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.
• 10 sale attempts since 19y ago; this cycle's ask has dropped $21k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $180k; 44% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.7% vs local median 4.1% 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 runs 42% of the median local income ($69k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 220 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1972 — 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.
• 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?

Repairs flagged (vision-AI assessment)

• Major: paint — significant discoloration and wear
• Major: landscaping — overgrown areas and lack of curb appeal