205 N 7th St

Keokuk, IA 52632

$41,500B+

2 bd · 1.0 ba · 1,244 sqft · Built 1910 · SingleFamily · Active · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $765/mo
• Mortgage (P&I): −$218
• Tax + insurance: −$167
• HOA: −$0
• Vac / Maint / Mgmt: −$161
• Net cashflow: $220/mo
• Annual: $2,641/yr
• Cap rate: 14.26%
• Cash-on-cash: 28.46%
• DSCR: 2.27
• 1% rule: 1.84%
• Cash to close: $11,620

Investor read

• This is a 2-bed/1.0-bath single-family listed at $42k.
• At list price, monthly cash flow is $220 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($765 rent vs $42k).
• It's been on market 25 days — a 2% lower offer ($41k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $41k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $287 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#166 in IA, #3,002 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities C-, commute F, employment F.
• Keokuk Community School District (town): math 48% / reading 54% proficiency, ranked #282 of 289 in IA (top 98%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Hawthorne Elementary School (math 62% / reading 37%, grade D, #514 of 616 statewide, top 85%, 464 students, 68% FRL); Keokuk Middle School (math 45% / reading 48%, grade D+, #230 of 246 statewide, top 93%, 377 students, 60% FRL); Keokuk High School (math 48% / reading 63%, grade C, #287 of 336 statewide, top 86%, 598 students, 53% FRL).
• Watch-outs: property tax is 2.7% of price; flood insurance adds $56/mo; built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 74 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 15 units permitted in Lee County in 2024 (0 in 5+ unit buildings).
• Lee County population projected at -15% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 3y ago; this cycle's ask has dropped $2k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $12k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 14.3% vs local median 8.2% in Keokuk — 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

• Built in 1910 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.