605 SW 1st Ave

Waukon, IA 52172

$109,000B-

2 bd · 1.0 ba · 1,205 sqft · Built 1893 · SingleFamily · Active · 260 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,143/mo
• Mortgage (P&I): −$572
• Tax + insurance: −$183
• HOA: −$0
• Vac / Maint / Mgmt: −$240
• Net cashflow: $148/mo
• Annual: $1,773/yr
• Cap rate: 7.92%
• Cash-on-cash: 5.81%
• DSCR: 1.26
• 1% rule: 1.05%
• Cash to close: $30,520

Investor read

• This is a 2-bed/1.0-bath single-family listed at $109k.
• At list price, monthly cash flow is $148 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $109k).
• It's been on market 260 days — a 12% lower offer ($96k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (12.0% below list) — sets the bar for market timing.
• In year one you build about $219 of equity ($754 loan paydown + $-535 appreciation (-0.5% local appreciation)).
• Location reads 79/100 on livability (#125 in IA, #2,301 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment D+, amenities F, commute F.
• Allamakee Community School District (town): math 71% / reading 75% proficiency, ranked #103 of 289 in IA (top 36%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1893 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 40 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 61 units permitted in Allamakee County in 2024 (0 in 5+ unit buildings).
• Allamakee County population projected at -26% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $65k; list at $109k implies a 68% gain — meaningful room to come down on a strong offer.
• At projected returns (-0.5% appreciation + 3.0% rent growth), your $31k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 7.9% vs local median 3.8% in Waukon — 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

• It's been on market 260 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1893 — 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.
• 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.
• 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.