124 Park Ave SW

Silver Lake, MN 55381

$85,000B-

2 bd · 1.0 ba · 818 sqft · Built 1890 · SingleFamily · Pending · 26 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,092/mo
• Mortgage (P&I): −$446
• Tax + insurance: −$131
• HOA: −$0
• Vac / Maint / Mgmt: −$229
• Net cashflow: $286/mo
• Annual: $3,429/yr
• Cap rate: 10.33%
• Cash-on-cash: 14.41%
• DSCR: 1.64
• 1% rule: 1.28%
• Cash to close: $23,800

Investor read

• This is a 2-bed/1.0-bath single-family listed at $85k.
• At list price, monthly cash flow is $286 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $85k).
• It's been on market 26 days — a 2% lower offer ($84k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $84k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $588 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#381 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, schools B; Watch: health & safety D+, amenities F, commute F.
• Glencoe-Silver Lake School District (town): math 40% / reading 44% proficiency, ranked #200 of 301 in MN (top 66%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 12 active listings in the ZIP; 57 units permitted in McLeod County in 2024 (0 in 5+ unit buildings).
• McLeod County population projected at -20% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $25k; list at $85k implies a 240% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $24k cash investment doubles in ~9 years — after that, you're playing with house money.

Questions for listing agent

• Built in 1890 — 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 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.