10045 State Hwy 27 W #25

Holmes City, MN 56308

$95,000D+

1 bd · 1.0 ba · 579 sqft · Built 2005 · SingleFamily · Active · 69 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,090/mo
• Mortgage (P&I): −$498
• Tax + insurance: −$158
• HOA: −$125
• Vac / Maint / Mgmt: −$229
• Net cashflow: $80/mo
• Annual: $957/yr
• Cap rate: 7.30%
• Cash-on-cash: 3.60%
• DSCR: 1.16
• 1% rule: 1.15%
• Cash to close: $26,600

Investor read

• This is a 1-bed/1.0-bath single-family listed at $95k.
• At list price, monthly cash flow is $80 ($957/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $95k).
• It's been on market 69 days — a 6% lower offer ($89k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $89k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $657 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Alexandria Public School District (town): math 55% / reading 57% proficiency, ranked #64 of 301 in MN (top 21%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Garfield Elementary (math 74% / reading 64%, grade A-, #74 of 857 statewide, top 10%, 128 students, 27% FRL); Discovery Middle School (math 51% / reading 57%, grade B-, #48 of 258 statewide, top 19%, 913 students, 34% FRL); Alexandria Area High School (math 39% / reading 62%, grade D+, #131 of 471 statewide, top 28%, 1,302 students, 26% FRL).
• Market conditions: 412 active listings in the ZIP; solid renter incomes; 285 units permitted in Douglas County in 2024 (88 in 5+ unit buildings).
• Douglas County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 18y ago; this cycle's ask has dropped $10k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• This rent is only 17% of the median local income ($78k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• It's been on market 69 days. Have you received any prior offers? Is the seller open to a 6% 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?
• 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?
• 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.