1907 S 5th St

Minneapolis, MN 55454

$249,999D

2 bd · 1.0 ba · 1,208 sqft · Built 1986 · Townhouse · Active · 97 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,842/mo
• Mortgage (P&I): −$1,311
• Tax + insurance: −$381
• HOA: −$350
• Vac / Maint / Mgmt: −$387
• Net cashflow: $-587/mo
• Annual: $-7,040/yr
• Cap rate: 3.48%
• Cash-on-cash: -10.06%
• DSCR: 0.55
• 1% rule: 0.74%
• Cash to close: $70,000

Investor read

• This is a 2-bed/1.0-bath townhouse listed at $250k.
• At list price, monthly cash flow is $-587 ($-7k/yr) — negative.
• To cash-flow at today's rent, offer at most $146k (41.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $184k (26.3% below list).
• It's been on market 97 days — a 9% lower offer ($227k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $146k (41.5% below list) — sets the bar for cash-flow.
• In year one you build about $5k of equity ($2k loan paydown + $3k appreciation (1.3% local appreciation)).
• 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.
• Market conditions: 9 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 5d on market — plan ~1-2 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 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; this cycle's ask has dropped $30k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• By year 7, paydown + projected appreciation supports a ~$33k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• At $1,842/mo this rent would consume 96% of the median local household income ($23k/yr) (locally 800% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• It's been on market 97 days. Have you received any prior offers? Is the seller open to a 41% 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.
• 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?
• 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.