3618 2nd Ave

Council Bluffs, IA 51501

$149,900D

2 bd · 1.0 ba · 960 sqft · Built 1984 · SingleFamily · Pending · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,243/mo
• Mortgage (P&I): −$786
• Tax + insurance: −$224
• HOA: −$0
• Vac / Maint / Mgmt: −$261
• Net cashflow: $-28/mo
• Annual: $-339/yr
• Cap rate: 6.07%
• Cash-on-cash: -0.81%
• DSCR: 0.96
• 1% rule: 0.83%
• Cash to close: $41,972

Investor read

• This is a 2-bed/1.0-bath single-family listed at $150k.
• At list price, monthly cash flow is $-28 ($-339/yr) — negative.
• To cash-flow at today's rent, offer at most $145k (3.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $124k (17.1% below list).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $124k (17.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k 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: Franklin Elementary School (math 54% / reading 54%, grade C, #488 of 616 statewide, top 80%, 497 students, 64% FRL); Woodrow Wilson Middle School (math 54% / reading 51%, grade C+, #209 of 246 statewide, top 85%, 900 students, 75% FRL); Thomas Jefferson High School (math 40% / reading 53%, grade D-, #321 of 336 statewide, top 96%, 1,243 students, 65% FRL) — zoned schools average 68% FRL vs 51% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents flat; 140 active listings in the ZIP; 39 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• Current owner paid $66k; list at $150k implies a 127% gain — meaningful room to come down on a strong offer.
• Cap rate 6.1% 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.

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.
• 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?
• 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.