35407 Vacation Dr #13

Breezy Point, MN 56472

$100,000C-

4 bd · 5.0 ba · 2,900 sqft · Built 2015 · Townhouse · Pending · 293 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,425/mo
• Mortgage (P&I): −$524
• Tax + insurance: −$167
• HOA: −$351
• Vac / Maint / Mgmt: −$299
• Net cashflow: $84/mo
• Annual: $1,002/yr
• Cap rate: 7.30%
• Cash-on-cash: 3.58%
• DSCR: 1.16
• 1% rule: 1.42%
• Cash to close: $28,000

Investor read

• This is a 4-bed/5.0-bath townhouse listed at $100k. Condition is rated good.
• At list price, monthly cash flow is $84 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $100k).
• It's been on market 293 days — a 12% lower offer ($88k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $88k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $691 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#330 in MN) — a middle-class / working-renter tenant base. Strengths: schools A+, crime A+, housing A+; Watch: health & safety C-, amenities F, commute F.
• Pequot Lakes Public Schools (rural): math 40% / reading 57% proficiency, ranked #137 of 301 in MN (top 46%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: HOA is 25% of rent.
• Market conditions: 272 active listings in the ZIP; 420 units permitted in Crow Wing County in 2024 (17 in 5+ unit buildings).
• Crow Wing County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Cap rate 7.3% vs local median 1.1% in Breezy Point — 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.

Questions for listing agent

• It's been on market 293 days. Have you received any prior offers? Is the seller open to a 12% 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.
• Schools are A-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?
• This sits on a lake — are riparian / water-frontage rights deeded with the parcel? Any dock permits, shoreline easements, or HOA water-use restrictions?
• What's the documented flood / surge / shoreline-erosion history here (FEMA AND non-FEMA — e.g., storm surge, creek backup, septic-field saturation)?
• Any water-quality or seasonal algae-bloom issues that affect tenant satisfaction or short-term-rental demand?