20366 Kensfield Trl #1703

Lakeville, MN 55044

$315,000D

3 bd · 3.0 ba · 1,777 sqft · Built 2004 · Townhouse · Pending · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,787/mo
• Mortgage (P&I): −$1,652
• Tax + insurance: −$371
• HOA: −$290
• Vac / Maint / Mgmt: −$585
• Net cashflow: $-112/mo
• Annual: $-1,341/yr
• Cap rate: 5.87%
• Cash-on-cash: -1.52%
• DSCR: 0.93
• 1% rule: 0.88%
• Cash to close: $88,200

Investor read

• This is a 3-bed/3.0-bath townhouse listed at $315k.
• At list price, monthly cash flow is $-112 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $295k (6.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $279k (11.5% below list).
• It's been on market 15 days — a 2% lower offer ($310k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $279k (11.5% 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 $9k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#25 in MN, #711 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, housing A+; Watch: amenities D+, commute F, cost of living F.
• Lakeville Public School District (suburban): math 57% / reading 65% proficiency, ranked #21 of 301 in MN (top 7%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 10% free/reduced lunch — higher-income household profile.
• Zoned schools: Lakeview Elementary (math 64% / reading 73%, grade B+, #91 of 857 statewide, top 11%, 521 students, 21% FRL); Mcguire Middle (math 52% / reading 59%, grade B-, #43 of 258 statewide, top 17%, 865 students, 20% FRL); Lakeville South High (math 51% / reading 67%, grade C+, #53 of 471 statewide, top 11%, 1,906 students, 24% FRL).
• Market conditions: Rents rising (+3.4%/yr); 728 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 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.
• 2 sale attempts since 9y 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 $215k; 47% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 5.9% vs local median 3.2% in Lakeville — 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

• 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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.