1200 Elm St

Webster City, IA 50595

$194,900D

3 bd · 2.0 ba · 1,378 sqft · Built 1944 · SingleFamily · Active · 30 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,638/mo
• Mortgage (P&I): −$1,022
• Tax + insurance: −$271
• HOA: −$0
• Vac / Maint / Mgmt: −$344
• Net cashflow: $2/mo
• Annual: $20/yr
• Cap rate: 6.30%
• Cash-on-cash: 0.04%
• DSCR: 1.00
• 1% rule: 0.84%
• Cash to close: $54,572

Investor read

• This is a 3-bed/2.0-bath single-family listed at $195k.
• At list price, monthly cash flow is $2 ($20/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $164k (15.9% below list).
• It's been on market 30 days — a 2% lower offer ($192k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $164k (15.9% 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 $6k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#137 in IA, #2,493 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities F, commute F.
• Webster City Community School District (town): math 60% / reading 60% proficiency, ranked #250 of 289 in IA (top 86%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Sunset Heights Elementary School (math 57% / reading 52%, grade C, #462 of 616 statewide, top 79%, 288 students, 51% FRL); Webster City Middle School (math 64% / reading 58%, grade B+, #181 of 246 statewide, top 74%, 455 students, 52% FRL); Webster City High School (math 55% / reading 64%, grade C+, #263 of 336 statewide, top 81%, 547 students, 44% FRL).
• Watch-outs: built in 1944 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 83 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 29 units permitted in Hamilton County in 2024 (5 in 5+ unit buildings).
• Hamilton County population projected at -15% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 6.3% vs local median 4.3% in Webster 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

• Built in 1944 — 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.
• 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.