114 Pine St NW

New London, MN 56273

$190,000D

3 bd · 2.0 ba · 1,188 sqft · Built 2003 · SingleFamily · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,545/mo
• Mortgage (P&I): −$996
• Tax + insurance: −$229
• HOA: −$0
• Vac / Maint / Mgmt: −$324
• Net cashflow: $-5/mo
• Annual: $-64/yr
• Cap rate: 6.26%
• Cash-on-cash: -0.12%
• DSCR: 0.99
• 1% rule: 0.81%
• Cash to close: $53,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $190k.
• At list price, monthly cash flow is $-5 ($-64/yr) — negative.
• To cash-flow at today's rent, offer at most $189k (0.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $154k (18.7% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $154k (18.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#309 in MN) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: health & safety D+, amenities F, commute F.
• New London-Spicer School District (town): math 55% / reading 58% proficiency, ranked #59 of 301 in MN (top 20%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 20% free/reduced lunch — higher-income household profile.
• Zoned schools: Prairie Woods Elementary (math 64% / reading 53%, grade B-, #251 of 857 statewide, top 30%, 567 students, 33% FRL); New London-Spicer Middle (math 53% / reading 60%, grade B, #38 of 258 statewide, top 15%, 476 students, 28% FRL); New London-Spicer Sr. (math 42% / reading 62%, grade D+, #111 of 471 statewide, top 26%, 465 students, 26% FRL).
• Market conditions: 40 active listings in the ZIP; 196 units permitted in Kandiyohi County in 2024 (118 in 5+ unit buildings).
• 4 sale attempts since 20y 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 $54k; list at $190k implies a 252% gain — meaningful room to come down on a strong offer.
• Cap rate 6.3% vs local median 1.7% in New London — 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• 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?
• 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.