107 Orchard St

Donnellson, IA 52625

$125,000C-

2 bd · 1.5 ba · 2,030 sqft · Built 1975 · SingleFamily · Active · 128 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,066/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$241
• HOA: −$0
• Vac / Maint / Mgmt: −$224
• Net cashflow: $-54/mo
• Annual: $-653/yr
• Cap rate: 5.77%
• Cash-on-cash: -1.87%
• DSCR: 0.92
• 1% rule: 0.85%
• Cash to close: $35,000

Investor read

• This is a 2-bed/1.5-bath single-family listed at $125k.
• At list price, monthly cash flow is $-54 ($-653/yr) — negative.
• To cash-flow at today's rent, offer at most $115k (7.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $107k (14.7% below list).
• It's been on market 128 days — a 12% lower offer ($110k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $107k (14.7% below list) — sets the bar for 1% rule.
• In year one you build about $5k of equity ($864 loan paydown + $4k appreciation (3.0% local appreciation)).
• Location reads 68/100 on livability (#457 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety C-, employment D+, amenities F.
• Central Lee Community School District (rural): math 69% / reading 75% proficiency, ranked #107 of 289 in IA (top 37%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: Central Lee Elementary School (math 67% / reading 69%, grade B+, #267 of 616 statewide, top 44%, 657 students, 35% FRL); Central Lee Middle School (math 75% / reading 78%, grade A, #57 of 246 statewide, top 23%, 267 students, 45% FRL); Central Lee High School (math 64% / reading 79%, grade B+, #134 of 336 statewide, top 41%, 326 students, 35% FRL).
• Market conditions: 14 active listings in the ZIP; 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.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $35k cash investment doubles in ~7 years — after that, you're playing with house money.
• By year 8, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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 128 days. Have you received any prior offers? Is the seller open to a 15% concession, seller financing, or rate buy-down credit?
• Built in 1975 — 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.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.