408 West Side Dr

Iowa City, IA 52246

$179,900D

3 bd · 2.0 ba · 1,292 sqft · Built 1993 · Condo · Active · 215 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,645/mo
• Mortgage (P&I): −$943
• Tax + insurance: −$342
• HOA: −$250
• Vac / Maint / Mgmt: −$345
• Net cashflow: $-236/mo
• Annual: $-2,837/yr
• Cap rate: 4.72%
• Cash-on-cash: -5.63%
• DSCR: 0.75
• 1% rule: 0.91%
• Cash to close: $50,372

Investor read

• This is a 3-bed/2.0-bath condo listed at $180k.
• At list price, monthly cash flow is $-236 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $138k (23.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $164k (8.6% below list).
• It's been on market 215 days — a 12% lower offer ($158k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $138k (23.2% below list) — sets the bar for cash-flow.
• 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 86/100 on livability (#13 in IA, #450 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+.
• Iowa City Community School District (urban): math 65% / reading 70% proficiency, ranked #174 of 289 in IA (top 60%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+4.9%/yr); 207 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 714 units permitted in Johnson County in 2024 (158 in 5+ unit buildings).
• Johnson County population projected at +60% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 7 sale attempts since 3y ago; this cycle's ask has dropped $13k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $122k; 47% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 4.7% vs local median 2.7% in Iowa 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.
• This rent runs 32% of the median local income ($63k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 215 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?
• 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?