831 19th Ave SE

Minneapolis, MN 55414

$255,000D

3 bd · 1.0 ba · 1,352 sqft · Built 1910 · SingleFamily · Pending · 24 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,087/mo
• Mortgage (P&I): −$1,337
• Tax + insurance: −$435
• HOA: −$0
• Vac / Maint / Mgmt: −$438
• Net cashflow: $-123/mo
• Annual: $-1,476/yr
• Cap rate: 5.71%
• Cash-on-cash: -2.07%
• DSCR: 0.91
• 1% rule: 0.82%
• Cash to close: $71,400

Investor read

• This is a 3-bed/1.0-bath single-family listed at $255k.
• At list price, monthly cash flow is $-123 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $233k (8.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $209k (18.1% below list).
• It's been on market 24 days — a 2% lower offer ($251k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $209k (18.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k 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 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.0%/yr); 87 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 21d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 3 sale attempts since 31y 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 $190k; 34% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% 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 $2,087/mo this rent would consume 48% of the median local household income ($52k/yr) (locally 3687% 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?
• Built in 1910 — 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.
• 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.
• 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.