464 Ormsbee St

Big Lake, MN 55309

$180,000B

4 bd · 2.0 ba · 2,208 sqft · Built 1950 · SingleFamily · Active · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,518/mo
• Mortgage (P&I): −$944
• Tax + insurance: −$350
• HOA: −$0
• Vac / Maint / Mgmt: −$529
• Net cashflow: $695/mo
• Annual: $8,345/yr
• Cap rate: 10.93%
• Cash-on-cash: 16.56%
• DSCR: 1.74
• 1% rule: 1.40%
• Cash to close: $50,400

Investor read

• This is a 4-bed/2.0-bath single-family listed at $180k.
• At list price, monthly cash flow is $695 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $180k).
• It's been on market 15 days — a 2% lower offer ($177k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $177k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#84 in MN, #1,950 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F.
• Big Lake Public School District (town): math 47% / reading 55% proficiency, ranked #78 of 301 in MN (top 26%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 19% free/reduced lunch — higher-income household profile.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 126 active listings in the ZIP; 1 comparable units currently listed for rent nearby; high-income renter base; 334 units permitted in Sherburne County in 2024 (58 in 5+ unit buildings).
• 5 sale attempts since 23y ago; this cycle's ask has dropped $10k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $72k; list at $180k implies a 150% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $50k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 10.9% vs local median 4.2% in Big Lake — 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

• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.