209 S 4th St

Council Bluffs, IA 51503

$495,000B

None bd · None ba · 2,204 sqft · Built 1920 · MultiFamily · Pending · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $10,056/mo
• Mortgage (P&I): −$2,596
• Tax + insurance: −$734
• HOA: −$0
• Vac / Maint / Mgmt: −$2,112
• Net cashflow: $4,614/mo
• Annual: $55,370/yr
• Cap rate: 17.48%
• Cash-on-cash: 39.95%
• DSCR: 2.78
• 1% rule: 2.03%
• Cash to close: $138,600

Investor read

• This is a 11 × 2-bed/1.5-bath units multifamily listed at $495k.
• At list price, monthly cash flow is $5k ($55k/yr) — positive. Per door: $419/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($10k rent vs $495k).
• It's been on market 20 days — a 2% lower offer ($488k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $488k (1.5% below list) — sets the bar for market timing.
• 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 70/100 on livability (#368 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety B+; Watch: employment C-, amenities D, crime D-.
• Council Bluffs Community School District (urban): math 52% / reading 55% proficiency, ranked #272 of 289 in IA (top 94%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Bloomer Elementary School (math 47% / reading 47%, grade D-, #530 of 616 statewide, top 88%, 422 students, 71% FRL); Gerald W Kirn Middle School (math 50% / reading 61%, grade B-, #199 of 246 statewide, top 81%, 956 students, 54% FRL); Abraham Lincoln High School (math 52% / reading 62%, grade C, #279 of 336 statewide, top 85%, 1,399 students, 52% FRL).
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.7%/yr); 195 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 679 units permitted in Pottawattamie County in 2024 (566 in 5+ unit buildings).
• Pottawattamie County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 4 sale attempts since 3y 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.
• At projected returns (-3.0% appreciation + 1.7% rent growth), your $139k cash investment doubles in ~4 years — after that, you're playing with house money.
• Cap rate 17.5% vs local median 3.3% in Council Bluffs — 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.
• At $10,056/mo this rent would consume 153% of the median local household income ($79k/yr) (locally 911% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1920 — 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.
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.