60, 62, 64 Franklin St

Waterloo, IA 50703

$40,000D+

None bd · None ba · 5,256 sqft · Built 1900 · MultiFamily · Active · 107 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,532/mo
• Mortgage (P&I): −$210
• Tax + insurance: −$67
• HOA: −$0
• Vac / Maint / Mgmt: −$742
• Net cashflow: $2,514/mo
• Annual: $30,166/yr
• Cap rate: 81.71%
• Cash-on-cash: 269.34%
• DSCR: 12.98
• 1% rule: 8.83%
• Cash to close: $11,200

Investor read

• This is a 3 × 3-bed/1-bath units multifamily listed at $40k. Condition is rated poor.
• At list price, monthly cash flow is $3k ($30k/yr) — positive. Per door: $838/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $40k).
• It's been on market 107 days — a 9% lower offer ($36k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $36k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $277 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#74 in IA, #1,589 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: schools C-, crime F, employment D-.
• Waterloo Community School District (urban): math 50% / reading 54% proficiency, ranked #276 of 289 in IA (top 96%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.7%/yr); 98 active listings in the ZIP; 287 units permitted in Black Hawk County in 2024 (67 in 5+ unit buildings).
• Black Hawk County population projected at +10% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (-3.0% appreciation + 6.7% rent growth), your $11k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 81.7% vs local median 4.2% in Waterloo — 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.
• At $3,532/mo this rent would consume 85% of the median local household income ($50k/yr) (locally 871% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 107 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?

Repairs flagged (vision-AI assessment)

• Major: exterior siding — The siding is peeling and damaged, requiring extensive repair.
• Major: roof — The roof appears to be in poor condition, with visible damage and potential leaks.
• Major: interior — The interior is not visible, but the exterior suggests significant damage and disrepair.
• Major: flooring — The flooring is not visible, but the exterior suggests significant damage and disrepair.
• Major: systems — No systems are visible, but the exterior suggests significant damage and disrepair.