423 Ash St

Cherokee, IA 51012

$165,750D-

3 bd · 2.5 ba · 1,432 sqft · Built 1962 · SingleFamily · Pending · 56 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,305/mo
• Mortgage (P&I): −$869
• Tax + insurance: −$255
• HOA: −$0
• Vac / Maint / Mgmt: −$274
• Net cashflow: $-93/mo
• Annual: $-1,121/yr
• Cap rate: 5.62%
• Cash-on-cash: -2.42%
• DSCR: 0.89
• 1% rule: 0.79%
• Cash to close: $46,410

Investor read

• This is a 3-bed/2.5-bath single-family listed at $166k.
• At list price, monthly cash flow is $-93 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $149k (10.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $131k (21.3% below list).
• It's been on market 56 days — a 3% lower offer ($161k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $131k (21.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#83 in IA, #1,698 nationally) — a professional / high-income tenant draw. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D+, amenities F, commute F.
• Cherokee Community School District (town): math 65% / reading 67% proficiency, ranked #191 of 289 in IA (top 66%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Cherokee Elementary School (math 57% / reading 52%, grade C, #462 of 616 statewide, top 79%, 492 students, 43% FRL); Cherokee Middle School (math 65% / reading 64%, grade A-, #157 of 246 statewide, top 67%, 355 students, 42% FRL); Washington High School (math 69% / reading 81%, grade A-, #86 of 336 statewide, top 26%, 353 students, 33% FRL).
• Market conditions: 45 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 10 units permitted in Cherokee County in 2024 (0 in 5+ unit buildings).
• Cherokee County population projected at -23% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $118k; 40% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wildfire risk — expect insurance premiums to compound above CPI over the hold.

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 56 days. Have you received any prior offers? Is the seller open to a 21% concession, seller financing, or rate buy-down credit?
• Built in 1962 — 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 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?
• 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.