1806 23rd Ave S

Fargo, ND 58103

$220,000D

2 bd · 1.0 ba · 1,164 sqft · Built 1982 · MultiFamily · Pending · 31 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,694/mo
• Mortgage (P&I): −$1,154
• Tax + insurance: −$191
• HOA: −$0
• Vac / Maint / Mgmt: −$356
• Net cashflow: $-7/mo
• Annual: $-79/yr
• Cap rate: 6.26%
• Cash-on-cash: -0.13%
• DSCR: 0.99
• 1% rule: 0.77%
• Cash to close: $61,600

Investor read

• This is a 2-bed/1.0-bath multifamily listed at $220k.
• At list price, monthly cash flow is $-7 ($-79/yr) — negative.
• To cash-flow at today's rent, offer at most $219k (0.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $169k (23.0% below list).
• It's been on market 31 days — a 3% lower offer ($213k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $169k (23.0% 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 $7k of value loss. Plan a longer hold.
• Location reads 85/100 on livability (#1 in ND, #605 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime F.
• Fargo 1 (urban): math 41% / reading 44% proficiency, ranked #28 of 53 in ND (top 53%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Ed Clapp Elementary School (math 17% / reading 22%, grade F, #222 of 236 statewide, top 94%, 452 students, 78% FRL); Carl Ben Eielson Middle School (math 30% / reading 38%, grade F, #26 of 35 statewide, top 79%, 615 students, 41% FRL); South High School (math 27% / reading 37%, grade F, #85 of 144 statewide, top 62%, 961 students, 32% FRL) — zoned schools average 51% FRL vs 25% district-wide (25 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 28% at this address vs 42% district-wide (-14 pts) — the specific schools serving this property underperform the Fargo 1 average; the district grade overstates school quality for this exact location.
• Market conditions: Rents rising fast (+5.0%/yr); 213 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 1,218 units permitted in Cass County in 2024 (410 in 5+ unit buildings).
• Cass County population projected at +69% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 7y 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.
• Cap rate 6.3% vs local median 2.5% in Fargo — 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.
• This rent runs 35% of the median local income ($59k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 31 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.