817 Bowery St

Iowa City, IA 52240

$264,900B+

4 bd · 3.0 ba · 2,045 sqft · Built 1910 · MultiFamily · Pending · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,469/mo
• Mortgage (P&I): −$1,389
• Tax + insurance: −$535
• HOA: −$0
• Vac / Maint / Mgmt: −$728
• Net cashflow: $817/mo
• Annual: $9,800/yr
• Cap rate: 9.99%
• Cash-on-cash: 13.21%
• DSCR: 1.59
• 1% rule: 1.31%
• Cash to close: $74,172

Investor read

• This is a 4-bed/3.0-bath multifamily listed at $265k.
• At list price, monthly cash flow is $817 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $265k).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 86/100 on livability (#13 in IA, #450 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+.
• Iowa City Community School District (urban): math 65% / reading 70% proficiency, ranked #174 of 289 in IA (top 60%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Longfellow Elementary School (math 60% / reading 62%, grade B, #385 of 616 statewide, top 63%, 385 students, 57% FRL); Southeast Junior High School (math 64% / reading 68%, grade A-, #152 of 246 statewide, top 62%, 812 students, 50% FRL); Iowa City High School (math 62% / reading 73%, grade B, #186 of 336 statewide, top 57%, 1,599 students, 40% FRL) — zoned schools average 49% FRL vs 30% district-wide (19 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.3%/yr); 260 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 714 units permitted in Johnson County in 2024 (158 in 5+ unit buildings).
• Johnson County population projected at +60% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts 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 $230k; 15% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 6.3% rent growth), your $74k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 10.0% vs local median 2.7% in Iowa City — 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 $3,469/mo this rent would consume 79% of the median local household income ($53k/yr) (locally 2852% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1910 — 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 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.