928 Water St

Webster City, IA 50595

$88,400C-

3 bd · 1.0 ba · 1,090 sqft · Built 1890 · SingleFamily · Active · 41 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $825/mo
• Mortgage (P&I): −$464
• Tax + insurance: −$137
• HOA: −$0
• Vac / Maint / Mgmt: −$173
• Net cashflow: $51/mo
• Annual: $610/yr
• Cap rate: 6.98%
• Cash-on-cash: 2.46%
• DSCR: 1.11
• 1% rule: 0.93%
• Cash to close: $24,752

Investor read

• This is a 3-bed/1.0-bath single-family listed at $88k.
• At list price, monthly cash flow is $51 ($610/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 $82k (6.7% below list).
• It's been on market 41 days — a 3% lower offer ($86k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $82k (6.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $611 of loan paydown is wiped out by about $3k 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.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 83 active listings in the ZIP; 1 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.
• 3 sale attempts since 3y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $73k; 21% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 7.0% 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

• It's been on market 41 days. Have you received any prior offers? Is the seller open to a 7% concession, seller financing, or rate buy-down credit?
• Built in 1890 — 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?
• 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.