205 12th Ave E

West Fargo, ND 58078

$279,900C+

4 bd · 1.0 ba · 1,008 sqft · Built 1976 · MultiFamily · Pending · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,176/mo
• Mortgage (P&I): −$1,468
• Tax + insurance: −$402
• HOA: −$0
• Vac / Maint / Mgmt: −$667
• Net cashflow: $639/mo
• Annual: $7,668/yr
• Cap rate: 9.03%
• Cash-on-cash: 9.78%
• DSCR: 1.44
• 1% rule: 1.13%
• Cash to close: $78,372

Investor read

• This is a 4-bed/1.0-bath multifamily listed at $280k.
• At list price, monthly cash flow is $639 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $280k).
• It's been on market 15 days — a 2% lower offer ($276k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $276k (1.5% 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 77/100 on livability (#10 in ND, #2,868 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, crime A; Watch: health & safety D+, amenities F, commute F.
• West Fargo 6 (suburban): math 41% / reading 42% proficiency, ranked #26 of 53 in ND (top 49%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: West Fargo High School (math 32% / reading 42%, grade F, #71 of 144 statewide, top 52%, 1,423 students, 32% FRL).
• Market conditions: Rents rising fast (+5.1%/yr); 257 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 1,218 units permitted in Cass County in 2024 (410 in 5+ unit buildings).
• Cass County population projected at +69% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 7y 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.
• Current owner paid $240k; 17% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 5.1% rent growth), your $78k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 9.0% vs local median 3.1% in West Fargo — 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 ($91k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1976 — 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.