4455 Westdel Rd

Farmington, MN 55024

$182,500D

2 bd · 1.0 ba · 974 sqft · Built 1986 · Condo · Pending · 32 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,865/mo
• Mortgage (P&I): −$957
• Tax + insurance: −$220
• HOA: −$350
• Vac / Maint / Mgmt: −$392
• Net cashflow: $-53/mo
• Annual: $-642/yr
• Cap rate: 5.94%
• Cash-on-cash: -1.26%
• DSCR: 0.94
• 1% rule: 1.02%
• Cash to close: $51,100

Investor read

• This is a 2-bed/1.0-bath condo listed at $182k.
• At list price, monthly cash flow is $-53 ($-642/yr) — negative.
• To cash-flow at today's rent, offer at most $173k (5.2% below list).
• Meets the 1% rule at list price ($2k rent vs $182k).
• It's been on market 32 days — a 3% lower offer ($177k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $173k (5.2% below list) — sets the bar for cash-flow.
• 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 75/100 on livability (#203 in MN, #4,269 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F.
• Farmington Public School District (suburban): math 43% / reading 52% proficiency, ranked #104 of 301 in MN (top 35%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; only 12% free/reduced lunch — higher-income household profile.
• Market conditions: 326 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 2,134 units permitted in Dakota County in 2024 (898 in 5+ unit buildings).
• Dakota County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 6 sale attempts since 21y 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 $122k; 49% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 5.9% vs local median 3.8% in Farmington — 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 is only 18% of the median local income ($127k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 32 days. Have you received any prior offers? Is the seller open to a 5% 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?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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?
• 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.