426 S 4th Ave W

Newton, IA 50208

$80,520C-

1 bd · 1.0 ba · 958 sqft · Built 1920 · SingleFamily · Active · 180 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $824/mo
• Mortgage (P&I): −$422
• Tax + insurance: −$236
• HOA: −$0
• Vac / Maint / Mgmt: −$173
• Net cashflow: $-7/mo
• Annual: $-85/yr
• Cap rate: 6.19%
• Cash-on-cash: -0.38%
• DSCR: 0.98
• 1% rule: 1.02%
• Cash to close: $22,546

Investor read

• This is a 1-bed/1.0-bath single-family listed at $81k.
• At list price, monthly cash flow is $-7 ($-85/yr) — negative.
• To cash-flow at today's rent, offer at most $79k (1.5% below list).
• Meets the 1% rule at list price ($824 rent vs $81k).
• It's been on market 180 days — a 12% lower offer ($71k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $71k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $557 of loan paydown is wiped out by about $2k 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.
• Watch-outs: property tax is 3.0% of price; built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 242 active listings in the ZIP; 15 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 7 sale attempts since 17y ago; this cycle's ask has dropped $26k (25%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 6.2% 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.
• This rent is only 16% of the median local income ($62k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 180 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1920 — 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.