NE Minneapolis Househack Analysis

[AJ Smith]

Property Address	2318 2nd St NE, MPLS 55418
MLS#	5539941
Number of Units (Duplex, Triplex, 4plex)	2
Crime Rating (Low/Medium/High)	Low
Property Listing Price	$ 300,000.00
Rehab Needed? (None/Light/Medium/Heavy/Full)	None
Square Footage	2,070
Rehab Price/Square Foot (Refer to Key on Right)	$ -
Total Rehab Estimate	$ -
Total Cost (Purchase + Rehab)	$ 300,000.00
MINIMUM Down Payment Required for Purchase	$ 15,000.00
Conventional Loan Amount (Total - Down payment)	$ 285,000.00
FULL OCCUPANCY CASH FLOW
Est. Monthly Rent (using www.myrentrates.com)	$ 2,910.00 (from listing)
1% Rule (Rent should be 1% of Purchase + Rehab)	$ 3,000.00
Does this PASS the 1% Rule?	NO
Est. Monthly Payment (PITI + PMI) - Mortg. Calculator	$ 1,873.53
Est. Monthly OpEx (PITI + PMI + Utilities + Reserves)	$ 2,706.43
Est. Monthly Cash flow (Rent - OpEx)	$ 203.57
CoCRoI	16.3%

...

HOUSEHACKING CASH FLOW
Est. Monthly Rents	$ 2,175.00
1% Rule	$ 3,000.00
Does this PASS the 1% Rule?	NO
Est. Monthly Payment	$ 1,873.53
Est. Monthly OpEx	$ 2,706.43
Est. Monthly Cash flow	$ (411.43)
CoCRoI	-32.9%

...

ASSUMPTIONS

Utilities (Varies by Property)
Electricity
Water & Sewer		100.00
Garbage		60.00
Shoveling/Lawn Care		120
Total		$ 280.00
Reserves
Vacancy (%)	5.00%	$ 145.50
Repairs & Maintenance (%)	7.00%	$ 203.70
CapEx (%)	7.00%	$ 203.70
Management Fees (%)		$ -
Total		$ 552.90

...

Minneapolis Househackers, interested in your thoughts on this deal.

I think this one has potential.

Each side is 2br/1ba.

I think the rents of $1455/side seem a bit high for a 2br. I checked the listing and MyRentRates.com and it seems to check out for the area, but would love to get your thoughts on the rents for sure.

AJ

[Tammy Ziegler]

I live in the area 25+ years and own a triplex in a slightly more desirable part of the neighborhood a bit south. I’d say that rent is a bit borderline for 2/1 but probably doable for that square footage especially if you allow pets or include garage space. I looked at the listing pics and it says utilities are split and both have in-unit laundry so that is good. To me the finishes and condition look a bit worn, so without clean-up and light remodel (paint at least) probably more attractive to tenants with dogs. That’s a good area and Lowry Ave just north of there is slated for re-development eventually.