Real Estate Investing in Cottage Grove, Minnesota (55016)
Everything the listing leaves out — vacancy, rent trend, cap rate, landlord climate. All free.
Should you buy in 55016 (Cottage Grove, MN)? Our answer, based on the numbers below.
Mixed signals — some positives, some negatives. Worth considering but not a slam-dunk.
A middle-of-the-road market. Workable, but the best opportunities may be nearby ZIPs rather than this one.
No major risk flags on the data we track.
What’s happening in Cottage Grove, MN (55016)?
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Market Analysis: 55016 Cottage Grove
Not every below-median market is a bargain. Cottage Grove's 55016 ZIP sits at signals that favor experienced operators who can absorb the risk $402K pricing implies.
Distressed markets are won on execution, not on spreadsheets. ZIP 55016 registers the profile where tenant screening, deferred maintenance, and local relationships determine the outcome.
In the broader MN picture, 55016 is a reminder that not every low-priced ZIP is a value-add opportunity — some are simply distressed, and the difference matters.
A robust renter share of 12% in 55016 is not, on its own, a problem — but paired with below-average income and high mobility, it changes the operating playbook.
Experienced landlords with local relationships tend to find 55016 workable. Turnkey investors from out of state usually find the numbers do not hold up in practice.
Here's what matters if you're considering buying a home in Cottage Grove:
Property Strategy for 55016
Which property type performs best in this market?
📊 Compare All Property Types →
| Type | Median Value | Est. Rent | Cap Rate | 5yr CAGR | $/Bedroom |
|---|---|---|---|---|---|
| 2BR | $282,952 | $2,100 | 5.3% | +3.8% | $141,476 |
| 3BR | $352,774 | $2,780 | 5.7% | +4.5% | $117,591 |
| 4BR | $436,302 | $3,110 | 5.1% | +4.5% | $109,075 |
| 5BR | $505,778 | — | — | +4.8% | $101,156 |
Market Trends
Home Value History (with trend line)
Rent History (with trend line)
📊 How Does 55016 Compare?
| Metric | 55016 | Cottage Grove | Minnesota |
|---|---|---|---|
| Home Value | $402,307 | $402,307 | $340,597 |
| 5-Year CAGR | 2.5% | 2.5% | 4.9% |
| Avg Rent | $1,908 | $1,908 | - |
| Cap Rate | 3.7% | 3.7% | - |
Similar ZIPs Within 25 Miles
Compare other nearby markets to see if a neighbor offers a better fit.
Landlord Ground Truth
Real numbers from people who own or manage rentals in ZIP 55016 (Cottage Grove, MN). Anonymous, moderated, never written by AI.
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📊 Market Snapshot
| Home Value | $402,307 |
| Monthly Rent | $1,908 |
| Price-to-Rent | 17.6:1 |
| 1% Rule | ✗ Fails |
💰 Return Metrics
| Gross Yield | 5.7% |
| Cap Rate | 3.7% |
| 5-Year IRR | 6.2% |
📈 Home Appreciation
| 1-Year | +4.4% ▲ |
| 3-Year CAGR | +1.7% ▲ |
| 5-Year CAGR | +2.5% ▲ |
| 10-Year CAGR | +4.9% ▲ |
🏠 Rent Trends
| 1-Year | +3.8% ▲ |
| 3-Year CAGR | +3.4% ▲ |
| 5-Year CAGR | N/A |
The current 30-yr mortgage rate (6.8%) exceeds the estimated cap rate (3.7%). Financing reduces your cash-on-cash return below the cap rate. Markets like this may still make sense as IRR plays — factoring in appreciation, depreciation, and a future refinance when rates drop.
Run an IRR Analysis →⚠️ Risk Signals
Composite view of factors that can impact a ZIP's stability and your downside risk.
Demographics in 55016
Population: 39,925
Crime & Safety
Crime & Safety Data Coming Soon
We're integrating comprehensive crime statistics including violent crime rates, property crime, and safety scores to help you make informed investment decisions.
Expected: Q1 2025
🎓 Schools in 55016
Schools in This ZIP Code
About Repit School Scores
Traditional school ratings rely heavily on standardized test scores, which often reflect family income more than school quality. Repit takes a different approach.
We evaluate schools based on factors that research shows actually impact educational outcomes:
- Class Size — Smaller classes mean more individual attention
- School Funding — Resources available for programs, staff, and facilities
- Community Factors — Neighborhood characteristics that influence student success
- School Environment — Size, type, and structure
Scores are updated annually using federal education data.
🎓 Nearby Colleges & Universities
Investor Insight: With 6,236 students living off-campus nearby, this area has strong rental demand from the college population.
Frequently Asked Questions
How high is vacancy risk in Cottage Grove, MN?
Vacancy in Cottage Grove, MN is elevated, which keeps landlord downtime on reasonable timelines. Most properties lease within the standard window at $1,908/mo.
How strict are landlord regulations in Cottage Grove, MN?
For rental operators, Cottage Grove, MN rates as balanced. The regulatory environment standard buy-and-hold operations.
How much is rent in Cottage Grove, MN?
Rental rates in Cottage Grove, MN average $1,908/mo. Tenant demand and $402K home values make the yield look reasonable by investor standards.
What kind of tenants rent in Cottage Grove, MN?
Tenant demand in Cottage Grove, MN is solid. The local workforce $1,908/mo rents across most rental classes.
What is the best play in Cottage Grove, MN?
The best-fit strategy in Cottage Grove, MN is careful cash-flow rentals with hands-on management. That approach the rent and price profile of the market.
You know 55016 now. You don’t know where it ranks.
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How 55016 ranks in Minneapolis-St. Paul-Bloomington, MN-WI
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