414 4th St SW

Mason City, IA 50401

$130,000D

2 bd · 1.0 ba · 780 sqft · Built 2014 · Condo · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,259/mo
• Mortgage (P&I): −$682
• Tax + insurance: −$186
• HOA: −$120
• Vac / Maint / Mgmt: −$264
• Net cashflow: $7/mo
• Annual: $81/yr
• Cap rate: 6.35%
• Cash-on-cash: 0.22%
• DSCR: 1.01
• 1% rule: 0.97%
• Cash to close: $36,400

Investor read

• This is a 2-bed/1.0-bath condo listed at $130k.
• At list price, monthly cash flow is $7 ($81/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 $126k (3.2% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $126k (3.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $899 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#67 in IA, #1,477 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities F.
• Mason City Community School District (town): math 50% / reading 58% proficiency, ranked #271 of 289 in IA (top 94%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 153 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 54 units permitted in Cerro Gordo County in 2024 (6 in 5+ unit buildings).
• Cerro Gordo County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.4% vs local median 5.2% in Mason City — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

Questions for listing agent

• 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.