1389 Cardinal Dr

Fairfax, IA 52228

$495,000D-

5 bd · 3.0 ba · 1,565 sqft · Built 2022 · Other · Pending · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,045/mo
• Mortgage (P&I): −$2,596
• Tax + insurance: −$847
• HOA: −$0
• Vac / Maint / Mgmt: −$430
• Net cashflow: $-1,827/mo
• Annual: $-21,925/yr
• Cap rate: 1.86%
• Cash-on-cash: -15.82%
• DSCR: 0.30
• 1% rule: 0.41%
• Cash to close: $138,600

Investor read

• This is a 5-bed/3.0-bath other listed at $495k.
• At list price, monthly cash flow is $-2k ($-22k/yr) — negative.
• To cash-flow at today's rent, offer at most $172k (65.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $205k (58.7% below list).
• It's been on market 27 days — a 2% lower offer ($488k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $172k (65.2% below list) — sets the bar for cash-flow.
• In year one you build about $53k of equity ($3k loan paydown + $50k appreciation (10.0% local appreciation)).
• Location reads 74/100 on livability (#232 in IA, #4,402 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: schools C-, amenities F, commute F.
• College Community School District (urban): math 62% / reading 70% proficiency, ranked #173 of 289 in IA (top 60%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 42 active listings in the ZIP; 1,023 units permitted in Linn County in 2024 (456 in 5+ unit buildings).
• Linn County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 4y 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.
• By year 2, paydown + projected appreciation supports a ~$85k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 1.9% vs local median 2.6% in Fairfax — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.

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?
• 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 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.