Chatham XL Plan

Johnston, IA 50131

$310,000F

4 bd · 2.5 ba · 1,922 sqft · Built — · SingleFamily · Active · 956 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,185/mo
• Mortgage (P&I): −$2,535
• Tax + insurance: −$806
• HOA: −$12
• Vac / Maint / Mgmt: −$459
• Net cashflow: $-1,627/mo
• Annual: $-19,519/yr
• Cap rate: 2.25%
• Cash-on-cash: -14.42%
• DSCR: 0.36
• 1% rule: 0.45%
• Cash to close: $135,349

Investor read

• This is a 4-bed/2.5-bath single-family listed at $310k.
• At list price, monthly cash flow is $-2k ($-20k/yr) — negative.
• To cash-flow at today's rent, offer at most $248k (20.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $218k (29.5% below list).
• It's been on market 956 days — a 12% lower offer ($273k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $218k (29.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $15k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#59 in IA, #1,344 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F.
• Johnston Community School District (suburban): math 78% / reading 78% proficiency, ranked #24 of 289 in IA (top 8%) — strong family-tenant draw, lease renewals of 3-5y typical; only 14% free/reduced lunch — higher-income household profile.
• Zoned schools: Horizon Elementary (math 71% / reading 67%, grade A-, #263 of 616 statewide, top 43%, 647 students, 36% FRL); Summit Middle School (math 80% / reading 77%, grade A+, #44 of 246 statewide, top 19%, 1,112 students, 27% FRL); Johnston Senior High School (math 76% / reading 79%, grade A-, #56 of 336 statewide, top 17%, 1,790 students, 23% FRL).
• Market conditions: Rents rising (+1.5%/yr); 382 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 16d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 2,953 units permitted in Polk County in 2024 (540 in 5+ unit buildings).
• Polk County population projected at +37% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.

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?
• It's been on market 956 days. Have you received any prior offers? Is the seller open to a 30% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 A-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.