4494 Taft Ave Lot 38c Ave

Iowa City, IA 52240

$26,000D+

2 bd · 1.0 ba · 1,800 sqft · Built 2025 · Other · Active · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,306/mo
• Mortgage (P&I): −$136
• Tax + insurance: −$43
• HOA: −$0
• Vac / Maint / Mgmt: −$274
• Net cashflow: $852/mo
• Annual: $10,226/yr
• Cap rate: 45.62%
• Cash-on-cash: 140.47%
• DSCR: 7.25
• 1% rule: 5.02%
• Cash to close: $7,280

Investor read

• This is a 2-bed/1.0-bath other listed at $26k.
• At list price, monthly cash flow is $852 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $26k).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $180 of loan paydown is wiped out by about $780 of value loss. Plan a longer hold.
• Location reads 86/100 on livability (#13 in IA, #450 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+.
• Iowa City Community School District (urban): math 65% / reading 70% proficiency, ranked #174 of 289 in IA (top 60%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+6.3%/yr); 260 active listings in the ZIP; 714 units permitted in Johnson County in 2024 (158 in 5+ unit buildings).
• Johnson County population projected at +60% 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 + 6.3% rent growth), your $7k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 45.6% vs local median 2.7% in Iowa City — 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

• 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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.