2001 1st Ave

Perry, IA 50220

$115,500D+

3 bd · 2.0 ba · 1,238 sqft · Built 1890 · Other · Active · 106 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,036/mo
• Mortgage (P&I): −$606
• Tax + insurance: −$255
• HOA: −$0
• Vac / Maint / Mgmt: −$218
• Net cashflow: $-42/mo
• Annual: $-509/yr
• Cap rate: 5.85%
• Cash-on-cash: -1.57%
• DSCR: 0.93
• 1% rule: 0.90%
• Cash to close: $32,340

Investor read

• This is a 3-bed/2.0-bath other listed at $116k.
• At list price, monthly cash flow is $-42 ($-509/yr) — negative.
• To cash-flow at today's rent, offer at most $108k (6.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $104k (10.3% below list).
• It's been on market 106 days — a 9% lower offer ($105k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $104k (10.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $799 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#273 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities F, commute F, employment D-.
• Perry Community School District (town): math 51% / reading 59% proficiency, ranked #266 of 289 in IA (top 92%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; 61% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 49 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; 1,503 units permitted in Dallas County in 2024 (630 in 5+ unit buildings).
• Dallas County population projected at +74% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 8y 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.
• Cap rate 5.9% vs local median 3.9% in Perry — 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

• 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 106 days. Have you received any prior offers? Is the seller open to a 10% concession, seller financing, or rate buy-down credit?
• Built in 1890 — 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.
• 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.