2939 SW 12th Ave

Cedar Rapids, IA 52404

$3,300,000B

None bd · 5.0 ba · 40,000 sqft · Built 1975 · MultiFamily · Active · 95 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $69,212/mo
• Mortgage (P&I): −$17,306
• Tax + insurance: −$5,500
• HOA: −$0
• Vac / Maint / Mgmt: −$14,535
• Net cashflow: $31,872/mo
• Annual: $382,463/yr
• Cap rate: 17.88%
• Cash-on-cash: 41.39%
• DSCR: 2.84
• 1% rule: 2.10%
• Cash to close: $924,000

Investor read

• This is a ?-bed/5.0-bath multifamily listed at $3.30M. Condition is rated poor.
• At list price, monthly cash flow is $32k ($382k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($69k rent vs $3.30M).
• It's been on market 95 days — a 9% lower offer ($3.00M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $3.00M (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $23k of loan paydown is wiped out by about $99k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#134 in IA, #2,474 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime C-, commute F.
• Cedar Rapids Community School District (urban): math 50% / reading 59% proficiency, ranked #265 of 289 in IA (top 92%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+8.8%/yr); 415 active listings in the ZIP; 1,023 units permitted in Linn County in 2024 (456 in 5+ unit buildings).
• Linn County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $924k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 17.9% vs local median 3.5% in Cedar Rapids — 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.
• At $69,212/mo this rent would consume 1342% of the median local household income ($62k/yr) (locally 1041% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 95 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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.

Repairs flagged (vision-AI assessment)

• Major: exterior siding — Severe weathering and damage
• Major: roof — Significant wear and potential leaks
• Major: flooring — Severe wear and tear
• Major: interior walls/paint — Peeling and chipping paint