903 NE Park Ave

Independence, IA 50644

$125,000D+

2 bd · 2.0 ba · 1,118 sqft · Built 1952 · SingleFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,055/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$213
• HOA: −$0
• Vac / Maint / Mgmt: −$222
• Net cashflow: $-35/mo
• Annual: $-420/yr
• Cap rate: 5.96%
• Cash-on-cash: -1.20%
• DSCR: 0.95
• 1% rule: 0.84%
• Cash to close: $35,000

Investor read

• This is a 2-bed/2.0-bath single-family listed at $125k.
• At list price, monthly cash flow is $-35 ($-420/yr) — negative.
• To cash-flow at today's rent, offer at most $119k (4.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $106k (15.6% below list).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $106k (15.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $864 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#198 in IA, #3,628 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F.
• Independence Community School District (rural): math 73% / reading 74% proficiency, ranked #86 of 289 in IA (top 30%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: West Elementary School (math 71% / reading 70%, grade A-, #217 of 616 statewide, top 36%, 381 students, 40% FRL); Independence Junior Senior High School (math 74% / reading 77%, grade A-, #79 of 336 statewide, top 25%, 701 students, 32% FRL).
• Watch-outs: built in 1952 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 63 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 19 units permitted in Buchanan County in 2024 (0 in 5+ unit buildings).
• Buchanan County population projected to shrink 9% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 10y 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.
• Current owner paid $85k; 47% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.0% vs local median 3.6% in Independence — 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?
• Built in 1952 — 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?
• 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.