2507 Lyndale Ave S

Minneapolis, MN 55405

$599,000B-

20 bd · 16.0 ba · 3,308 sqft · Built 1900 · MultiFamily · Active · 86 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $10,229/mo
• Mortgage (P&I): −$3,141
• Tax + insurance: −$946
• HOA: −$0
• Vac / Maint / Mgmt: −$2,148
• Net cashflow: $3,993/mo
• Annual: $47,920/yr
• Cap rate: 14.29%
• Cash-on-cash: 28.57%
• DSCR: 2.27
• 1% rule: 1.71%
• Cash to close: $167,720

Investor read

• This is a 4 × 5-bed/4.0-bath units multifamily listed at $599k.
• At list price, monthly cash flow is $4k ($48k/yr) — positive. Per door: $998/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($10k rent vs $599k).
• It's been on market 86 days — a 6% lower offer ($563k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $563k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $18k 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: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.9%/yr); 100 active listings in the ZIP; 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.
• 4 sale attempts since 22y 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 $320k; list at $599k implies a 87% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 1.9% rent growth), your $168k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 14.3% 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.
• At $10,229/mo this rent would consume 168% of the median local household income ($73k/yr) (locally 985% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 86 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.