433 S 7th St #1704

Minneapolis, MN 55415

$65,000B+

1 bd · 1.0 ba · 510 sqft · Built 1985 · Condo · Pending · 35 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,684/mo
• Mortgage (P&I): −$341
• Tax + insurance: −$136
• HOA: −$621
• Vac / Maint / Mgmt: −$354
• Net cashflow: $232/mo
• Annual: $2,790/yr
• Cap rate: 10.59%
• Cash-on-cash: 15.33%
• DSCR: 1.68
• 1% rule: 2.59%
• Cash to close: $18,200

Investor read

• This is a 1-bed/1.0-bath condo listed at $65k.
• At list price, monthly cash flow is $232 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $65k).
• It's been on market 35 days — a 3% lower offer ($63k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $63k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $449 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#110 in MN, #2,525 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: cost of living C-, crime F.
• Minneapolis Public School District (urban): math 35% / reading 46% proficiency, ranked #217 of 301 in MN (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: HOA is 37% of rent.
• Market conditions: Rents rising (+2.6%/yr); 81 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 0d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 4,651 units permitted in Hennepin County in 2024 (2,443 in 5+ unit buildings).
• Hennepin County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 33y 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 $37k; list at $65k implies a 74% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.6% rent growth), your $18k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 10.6% vs local median 3.1% in Minneapolis — 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 is only 16% of the median local income ($125k/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 35 days. Have you received any prior offers? Is the seller open to a 3% 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.