205 Lake St

Joice, IA 50446

$125,000C-

4 bd · 1.5 ba · 1,523 sqft · Built 1944 · SingleFamily · Pending · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,017/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$152
• HOA: −$0
• Vac / Maint / Mgmt: −$214
• Net cashflow: $-4/mo
• Annual: $-50/yr
• Cap rate: 6.25%
• Cash-on-cash: -0.14%
• DSCR: 0.99
• 1% rule: 0.81%
• Cash to close: $35,000

Investor read

• This is a 4-bed/1.5-bath single-family listed at $125k.
• At list price, monthly cash flow is $-4 ($-50/yr) — negative.
• To cash-flow at today's rent, offer at most $124k (0.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $102k (18.6% below list).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $102k (18.6% below list) — sets the bar for 1% rule.
• In year one you build about $10k of equity ($864 loan paydown + $9k appreciation (7.5% local appreciation)).
• Location reads 61/100 on livability (#752 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime C-, health & safety C-, schools D-.
• Lake Mills Community School District (rural): math 68% / reading 72% proficiency, ranked #148 of 289 in IA (top 51%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1944 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 3 active listings in the ZIP.
• 2 sale attempts since 4y 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 $85k; 47% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (7.5% appreciation + 3.0% rent growth), your $35k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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?
• 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.