399 E Washington St

Marengo, IA 52301

$85,000C+

5 bd · 1.5 ba · 2,064 sqft · Built 1928 · SingleFamily · Active · 56 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,127/mo
• Mortgage (P&I): −$446
• Tax + insurance: −$333
• HOA: −$0
• Vac / Maint / Mgmt: −$237
• Net cashflow: $111/mo
• Annual: $1,337/yr
• Cap rate: 7.87%
• Cash-on-cash: 5.62%
• DSCR: 1.25
• 1% rule: 1.33%
• Cash to close: $23,800

Investor read

• This is a 5-bed/1.5-bath single-family listed at $85k.
• At list price, monthly cash flow is $111 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $85k).
• It's been on market 56 days — a 3% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $82k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $588 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#390 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities F, commute F.
• Iowa Valley Community School District (rural): math 70% / reading 77% proficiency, ranked #94 of 289 in IA (top 32%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: Iowa Valley Elementary School (math 72% / reading 72%, grade A-, #181 of 616 statewide, top 34%, 318 students, 41% FRL); Iowa Valley Jr-Sr High School (math 69% / reading 79%, grade B+, #103 of 336 statewide, top 32%, 229 students, 36% FRL).
• Watch-outs: property tax is 4.2% of price; built in 1928 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 38 active listings in the ZIP; 12 units permitted in Iowa County in 2024 (0 in 5+ unit buildings).
• Iowa County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 4y ago; this cycle's ask has dropped $5k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.

Questions for listing agent

• It's been on market 56 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1928 — 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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.
• 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.