817 E 4th St

Spencer, IA 51301

$129,500B-

2 bd · 1.0 ba · 1,719 sqft · Built 1942 · SingleFamily · Active · 45 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,460/mo
• Mortgage (P&I): −$679
• Tax + insurance: −$183
• HOA: −$0
• Vac / Maint / Mgmt: −$307
• Net cashflow: $291/mo
• Annual: $3,496/yr
• Cap rate: 8.99%
• Cash-on-cash: 9.64%
• DSCR: 1.43
• 1% rule: 1.13%
• Cash to close: $36,260

Investor read

• This is a 2-bed/1.0-bath single-family listed at $130k.
• At list price, monthly cash flow is $291 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $130k).
• It's been on market 45 days — a 3% lower offer ($126k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $126k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $895 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#168 in IA, #3,020 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment D, amenities F, commute F.
• Spencer Community School District (town): math 73% / reading 72% proficiency, ranked #114 of 289 in IA (top 39%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: Spencer Middle School (math 77% / reading 75%, grade A, #59 of 246 statewide, top 26%, 514 students, 43% FRL); Spencer High School (math 68% / reading 76%, grade B+, #117 of 336 statewide, top 39%, 712 students, 40% FRL).
• Watch-outs: built in 1942 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 109 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 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.
• 3 sale attempts since 7y 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; list at $130k implies a 52% gain — meaningful room to come down on a strong offer.
• Cap rate 9.0% vs local median 4.7% in Spencer — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• It's been on market 45 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1942 — 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 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?
• 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.