718 W 8th St N

Newton, IA 50208

$121,380B-

5 bd · 2.0 ba · 1,530 sqft · Built 1978 · SingleFamily · Pending · 75 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,505/mo
• Mortgage (P&I): −$637
• Tax + insurance: −$326
• HOA: −$0
• Vac / Maint / Mgmt: −$316
• Net cashflow: $226/mo
• Annual: $2,708/yr
• Cap rate: 8.52%
• Cash-on-cash: 7.97%
• DSCR: 1.35
• 1% rule: 1.24%
• Cash to close: $33,986

Investor read

• This is a 5-bed/2.0-bath single-family listed at $121k.
• At list price, monthly cash flow is $226 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $121k).
• It's been on market 75 days — a 6% lower offer ($114k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $114k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $839 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#169 in IA, #3,069 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime C-, employment D+, amenities F.
• Newton Community School District (town): math 59% / reading 62% proficiency, ranked #245 of 289 in IA (top 85%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Thomas Jefferson Elementary School (math 67% / reading 72%, grade A-, #224 of 616 statewide, top 42%, 325 students, 55% FRL); Berg Middle School (math 55% / reading 61%, grade B, #195 of 246 statewide, top 79%, 841 students, 55% FRL); Newton Senior High School (math 60% / reading 62%, grade C+, #258 of 336 statewide, top 78%, 818 students, 47% FRL).
• Watch-outs: property tax is 2.7% of price.
• Market conditions: 242 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 16 units permitted in Jasper County in 2024 (0 in 5+ unit buildings).
• Jasper County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 6 sale attempts since 11y ago; this cycle's ask has dropped $47k (28%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 8.5% vs local median 3.1% in Newton — 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

• It's been on market 75 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1978 — 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?
• 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 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.