723 6th St

International Falls, MN 56649

$139,900F

2 bd · 4.0 ba · 790 sqft · Built 1930 · Other · Active · 136 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $843/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$296
• HOA: −$0
• Vac / Maint / Mgmt: −$177
• Net cashflow: $-364/mo
• Annual: $-4,366/yr
• Cap rate: 3.17%
• Cash-on-cash: -11.15%
• DSCR: 0.50
• 1% rule: 0.60%
• Cash to close: $39,172

Investor read

• This is a 2-bed/4.0-bath other listed at $140k.
• At list price, monthly cash flow is $-364 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $76k (45.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $84k (39.7% below list).
• It's been on market 136 days — a 12% lower offer ($123k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $76k (45.9% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#242 in MN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime F, amenities D-, commute F.
• International Falls School District (town): math 40% / reading 45% proficiency, ranked #211 of 301 in MN (top 70%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Falls Elementary (math 52% / reading 52%, grade C-, #368 of 857 statewide, top 47%, 393 students, 49% FRL); Falls Secondary (math 32% / reading 41%, grade F, #298 of 471 statewide, top 63%, 501 students, 38% FRL).
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 70 active listings in the ZIP; 26 units permitted in Koochiching County in 2024 (0 in 5+ unit buildings).
• Koochiching County population projected at -27% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts; this cycle's ask has dropped $30k (18%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $34k; list at $140k implies a 311% gain — meaningful room to come down on a strong offer.
• Cap rate 3.2% vs local median 4.5% in International Falls — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.

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 136 days. Have you received any prior offers? Is the seller open to a 46% concession, seller financing, or rate buy-down credit?
• Built in 1930 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.