602 S 4th St

Knoxville, IA 50138

$178,300C+

4 bd · 2.0 ba · 1,995 sqft · Built 1910 · MultiFamily · Active · 223 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,922/mo
• Mortgage (P&I): −$935
• Tax + insurance: −$325
• HOA: −$0
• Vac / Maint / Mgmt: −$404
• Net cashflow: $258/mo
• Annual: $3,099/yr
• Cap rate: 8.03%
• Cash-on-cash: 6.21%
• DSCR: 1.28
• 1% rule: 1.08%
• Cash to close: $49,924

Investor read

• This is a 4-bed/2.0-bath multifamily listed at $178k.
• At list price, monthly cash flow is $258 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $178k).
• It's been on market 223 days — a 12% lower offer ($157k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $157k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#406 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities F, commute F.
• Knoxville Community School District (town): math 62% / reading 63% proficiency, ranked #220 of 289 in IA (top 76%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: West Elementary (465 students, 47% FRL); Knoxville Middle School (math 68% / reading 67%, grade A-, #133 of 246 statewide, top 56%, 368 students, 50% FRL); Knoxville High School (math 60% / reading 69%, grade B-, #211 of 336 statewide, top 70%, 500 students, 40% FRL).
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 100 active listings in the ZIP; 122 units permitted in Marion County in 2024 (0 in 5+ unit buildings).
• Marion County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 10 sale attempts since 16y ago; this cycle's ask has dropped $20k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $23k; list at $178k implies a 675% gain — meaningful room to come down on a strong offer.
• Cap rate 8.0% vs local median 2.4% in Knoxville — 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.
• This rent runs 31% of the median local income ($75k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 223 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1910 — 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.
• Schools are B-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 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.