205 E 3rd St

Peterson, IA 51047

$53,000B+

3 bd · 2.5 ba · 1,723 sqft · Built 1945 · SingleFamily · Active · 196 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,226/mo
• Mortgage (P&I): −$278
• Tax + insurance: −$124
• HOA: −$0
• Vac / Maint / Mgmt: −$257
• Net cashflow: $566/mo
• Annual: $6,795/yr
• Cap rate: 19.11%
• Cash-on-cash: 45.79%
• DSCR: 3.04
• 1% rule: 2.31%
• Cash to close: $14,840

Investor read

• This is a 3-bed/2.5-bath single-family listed at $53k.
• At list price, monthly cash flow is $566 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $53k).
• It's been on market 196 days — a 12% lower offer ($47k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $47k (12.0% below list) — sets the bar for market timing.
• In year one you build about $2k of equity ($366 loan paydown + $1k appreciation (2.4% local appreciation)).
• Location reads 65/100 on livability (#584 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety D, schools F, amenities F.
• Sioux Central Community School District (rural): math 68% / reading 73% proficiency, ranked #143 of 289 in IA (top 50%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 4 active listings in the ZIP; 11 units permitted in Clay County in 2024 (0 in 5+ unit buildings).
• Clay County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• At projected returns (2.4% appreciation + 3.0% rent growth), your $15k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: moderate wildfire risk — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 196 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1945 — 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 F-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.