206 3rd St

Duplex · 2 units: 3 bed / 1 bath ×2 unit split estimated · 4,030 sq ft

Overpriced

13 photos

Photos, via Realtor.com.

Asking price: $475,000
Monthly cash flow: −$630
Estimated rent: $3,450/mo
Break-even price: $356,644

Adjust the numbers See the full breakdown

From the listing

Looking to add to your real estate investment portfolio? This two-story brick building offers six income-producing units, including two commercial storefronts and four residential apartments. Positioned on Main Street with high visibility and a strong traffic count, the property enjoys a central location in the heart of town and is just two blocks from the local bike trail. The upper residential units have access to a second-story rear deck, while off-street parking provides added convenience for tenants and visitors. A washer and dryer serves the two upper-level apartments. Situated on two lots, this property combines historic character with practical amenities and a diversified income stream. Whether you're expanding an existing portfolio or seeking your next investment property, this well-cared-for asset offers strong appeal and lasting value. Schedule a personal tour today!

Description from Realtor.com, MLS #6126326. Believed reliable but not guaranteed; confirm with the listing agent. View on Realtor.com ↗

First look

This is a mixed-use building, not a standard 2\u20134 unit rental: two commercial storefronts and four apartments. Our model treats it as two 3-bed units, so the -$630/mo cash flow and 4.8% cap rate at ask are rough and likely miss the real rent roll. The photos show office fit-outs in what looks like the commercial space, so we can't tell what those tenants pay or on what terms. Get the rent roll, leases and trailing-12 expenses before anything else. Four apartments plus two storefronts could be worth a showing, but not at $475K until the actual income is known. At 103 days on market, expect room to negotiate.

Things to consider

Mixed-use: two storefronts plus four apartments Commercial vacancy and tenant turnover behave differently, and the lender, insurance and valuation differ from a plain residential rental.Listing says: “two commercial storefronts and four residential apartments”
No rent data, so the income is unknown Our estimate assumes two 3-bed units and likely misses the real income. The -$630/mo result is only a rough guide.
Price looks high versus break-even Ask is about $118K above our break-even price, so the price needs real income to justify it.
Taxes and unit count unverified The address didn't match a county parcel, so taxes, zoning and legal unit count need checking directly.
Building is 1930 brick with unseen systems Heating, wiring and plumbing age are unknown and could be costly across six units.

From the photos

Based on 6 of the listing photos. Photos can hide as much as they show; an inspection is the real answer.

AI-assisted first read of the listing description and photos (Claude), checked against public records. Every rent and repair above quotes the listing; verify with the agent, leases and an inspection.

The numbers

Edit rents, costs and assumptions

Default: 20% down (no PMI), offer at asking, self-managed, 7.00% for 30 years, buyer pays closing costs (3%).

The deal

Price: $475,000
Cash to close: $109,250
Price per unit: $237,500
GRM: 11.5

Each month

Cash flow: −$630/mo
Cash-on-cash: −6.9%
Cap rate: 4.8%
DSCR: 0.75×

Break-even

Price that breaks even: $356,644
Rent that breaks even: $4,258/mo

Long run

Year 30: property vs stocks: $1.36M vs $1.09M
Cash flow turns positive: year 12

Monthly

Monthly breakdown

Rent	$3,450
Vacancy (6%)	−$207
Collected	$3,243
Property tax Listing	−$329
Insurance Estimate	−$234
Water, sewer, trash Estimate	−$170
Lawn care ($120 × 6 mo ÷ 12)	−$60
Repairs (8% of rent)	−$276
Capital reserve (8% of rent)	−$276
Net operating income	$1,898
Mortgage (principal + interest)	−$2,528
Cash flow	−$630
Principal paid down (equity, not cash)	$322

Cash flow each year

Rents +3%/yr, costs +3.5%/yr. Red bars are months you'd cover out of pocket.

30 years

How those totals add up

If you buy this building$1,359,431

Your equity when you sell: $1,083,773
Rental profits, invested at 7%: $275,658

Same money in stocks$1,093,377

Cash to close, invested at 7%: $831,639
Monthly shortfalls, invested: $261,738

The building comes out $266,054 ahead after 30 years.

Future dollars. At 3% inflation, divide year-30 figures by about 2.4 for today's buying power. Rental profits are assumed invested, not spent.

30 years: this property vs. the same money in stocks

This propertyStocks at 7%

Year 30 (loan paid off): property $1.36M, stocks $1.09M. The property wins.

Comparable rentals

Nearby rentals RentCast matched to each unit type, as of 2026-10-05. The estimate above is RentCast's, weighted toward the closest matches.

3 bed / 1 bath estimate $1,725/mo · range $1,450–$2,000

Address	Rent	Bd / Ba	Sq ft	Distance	Listed	Match
340 6th St, Cloquet 55720 off market	$1,400	2 / 1	—	3.9 mi	2026-07-23	79%
13302 W 3rd St, Duluth 55808	$1,650	3 / 1	1,600	7.0 mi	2025-08-26	75%
618 N 56th Ave W, Duluth 55807 off market	$1,550	3 / 1	—	13.3 mi	2026-03-04	75%
25 9th St, Cloquet 55720 off market	$1,500	3 / 1	—	4.1 mi	2026-09-21	73%
622 Maple St, Cloquet 55720 off market	$1,700	3 / 1	—	4.3 mi	2026-02-24	73%
206 3rd St, # 202, Carlton 55718	$1,200	2 / 1	—	0.0 mi	2026-10-03	70%
6 Pantsar Rd, Esko 55733 off market	$2,200	3 / 2	—	3.7 mi	2023-11-28	69%
954 89th Ave W, Apt 102, Duluth 55808 off market	$1,300	2 / 1	—	10.3 mi	2026-09-24	69%
954 N 89th Ave, Unit 102, Duluth 55808	$1,300	2 / 1	—	10.3 mi	2026-10-05	69%
954 N 89th Ave, Unit 104, Duluth 55808	$1,200	2 / 1	—	10.3 mi	2026-10-05	69%

On the maps, this property and comparable rentals. Comparable rentals and rent estimate: RentCast. Rents are asking rents from listings; check them against the actual leases.

Red flags and opportunities

Watch for

highCommercial leases carry different risk: longer vacancy, tenant improvements, and often lease terms the listing doesn't state. Financing may also be commercial. Listing says: two commercial storefronts and four residential apartments · AI review
highNo rents, lease terms or occupancy stated anywhere in the listing. Based on: data: rent_estimate · AI review
mediumCouldn't match this address to a county parcel record, so taxes and unit count are unverified. Public record: County parcels: no match for 206 3RD ST
mediumOur unit count and rent model don't match the real six-unit mix, so underwriting is unreliable. Based on: data: listing.unit_count · AI review
lowShared washer and dryer for two apartments suggests no in-unit laundry, and the owner may be paying for it and the common areas. Listing says: A washer and dryer serves the two upper-level apartments. · AI review

Opportunities

Long time on market: room to negotiate. Based on: Listing data: 103 days on market
Main Street frontage with a strong traffic count could support commercial rents if the spaces are leased below market. Listing says: Positioned on Main Street with high visibility and a strong traffic count · AI review
Sitting on the market 103 days gives room to negotiate toward the break-even price. Based on: data: underwriting.break_even_price · AI review
Two lots may allow extra parking or future development. Listing says: Situated on two lots · AI review

Questions for the agent

What are the current rents and lease terms for each of the six units, and which are occupied?
Are the commercial tenants on NNN or gross leases, and who pays utilities and taxes?
How many separate electric, gas and water meters are there, and what heats each unit?
Are all four apartments licensed and legal rentals with proper egress?
What are the actual taxes and trailing-12 expenses, and why has it sat 103 days?
What are the roof, boiler or furnace and electrical ages?

Bottom line

Six units with commercial space could be interesting, but with no rents given and our model at -$630/mo at ask, it needs a real rent roll before it's worth pursuing. AI-assisted summary

What the records say

Where each number comes from

Property tax / yr Listinglisting, tax year 2026. The tax the listing states. If the seller lives there it may be at the lower homestead rate; an investor owner pays the non-homestead rate, often 20–40% more on the owner's unit.	$3,946
Insurance / yr Estimateestimate. from units, square feet and age; get a quote	$2,808
Water, sewer, trash / mo Estimateestimate. $85/unit/mo, owner-paid	$170
Heat / mo Assumptionassumption. tenants pay heat; confirm with the agent	$0
Lawn care / mo Assumptionassumption. $120/mo for 6 months, spread over 12; no snow removal	$60
Repairs / capital reserve Rulerule. base rate	8% / 8%

Price history Realtor.com

On the market since 2026-06-24 (103 days); down $20,000 (4.0%) from the first ask of $495,000.

Date	Event	Price
2026-09-17	Price changed	$475,000
2026-06-24	Listed	$495,000

From the listing Listing

Listed as	5-10 units
Property tax, 2026	$3,946
County	Carlton County
Parcel number	15-010-2140 and 15-010-2160

As the listing states it (NorthstarMLS, via Realtor.com). We don't have county records here yet; check the tax, homestead status and special assessments with the county.

Crime, rental-license and vacant-building records are only available for St. Paul and Minneapolis so far. Check with Carlton on rental licensing before you buy.