525 Avenue F

Fort Madison, IA 52627

$149,900D-

4 bd · 2.0 ba · 1,948 sqft · Built 1900 · SingleFamily · Active · 19 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,345/mo
• Mortgage (P&I): −$786
• Tax + insurance: −$241
• HOA: −$0
• Vac / Maint / Mgmt: −$282
• Net cashflow: $35/mo
• Annual: $421/yr
• Cap rate: 6.57%
• Cash-on-cash: 1.00%
• DSCR: 1.04
• 1% rule: 0.90%
• Cash to close: $41,972

Investor read

• This is a 4-bed/2.0-bath single-family listed at $150k.
• At list price, monthly cash flow is $35 ($421/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 $135k (10.3% below list).
• It's been on market 19 days — a 2% lower offer ($148k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $135k (10.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#230 in IA, #4,353 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: commute F, employment D-.
• Fort Madison Community School District (town): math 55% / reading 58% proficiency, ranked #260 of 289 in IA (top 90%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Lincoln Elementary School (math 72% / reading 42%, grade C+, #436 of 616 statewide, top 74%, 236 students, 57% FRL); Fort Madison Middle School (math 56% / reading 63%, grade B, #185 of 246 statewide, top 78%, 695 students, 56% FRL); Fort Madison High School (math 48% / reading 60%, grade C-, #293 of 336 statewide, top 87%, 555 students, 45% FRL).
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 65 active listings in the ZIP; 15 units permitted in Lee County in 2024 (0 in 5+ unit buildings).
• Lee County population projected at -15% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 11y 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 $86k; list at $150k implies a 73% gain — meaningful room to come down on a strong offer.
• Cap rate 6.6% vs local median 5.3% in Fort Madison — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

Questions for listing agent

• Built in 1900 — 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?
• 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?
• 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.