301 Summit St

Sanborn, IA 51248

$129,000D+

2 bd · 2.0 ba · 1,762 sqft · Built 1978 · SingleFamily · Pending · 7 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $925/mo
• Mortgage (P&I): −$676
• Tax + insurance: −$204
• HOA: −$0
• Vac / Maint / Mgmt: −$194
• Net cashflow: $-150/mo
• Annual: $-1,797/yr
• Cap rate: 4.90%
• Cash-on-cash: -4.98%
• DSCR: 0.78
• 1% rule: 0.72%
• Cash to close: $36,120

Investor read

• This is a 2-bed/2.0-bath single-family listed at $129k.
• At list price, monthly cash flow is $-150 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $103k (20.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $93k (28.3% below list).
• Only 7 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $93k (28.3% below list) — sets the bar for 1% rule.
• In year one you build about $7k of equity ($892 loan paydown + $6k appreciation (4.5% local appreciation)).
• Location reads 76/100 on livability (#184 in IA, #3,267 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment C-, amenities F, commute F.
• Hartley-Melvin-Sanborn Community School District (rural): math 72% / reading 73% proficiency, ranked #111 of 289 in IA (top 38%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: Hartley-Melvin-Sanborn Elementary School (math 74% / reading 74%, grade A, #131 of 616 statewide, top 27%, 270 students, 52% FRL); Hartley-Melvin-Sanborn Middle School (math 72% / reading 72%, grade A, #95 of 246 statewide, top 42%, 174 students, 51% FRL); Hartley-Melvin-Sanborn High School (math 72% / reading 77%, grade B+, #89 of 336 statewide, top 30%, 203 students, 47% FRL).
• Market conditions: 16 active listings in the ZIP; 13 units permitted in O'Brien County in 2024 (0 in 5+ unit buildings).
• O'Brien County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $100k; 29% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• By year 6, paydown + projected appreciation supports a ~$36k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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?
• Built in 1978 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.