903 S 5th Ave

Marshalltown, IA 50158

$47,500B

2 bd · 1.0 ba · 726 sqft · Built 1906 · SingleFamily · Pending · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $857/mo
• Mortgage (P&I): −$249
• Tax + insurance: −$103
• HOA: −$0
• Vac / Maint / Mgmt: −$180
• Net cashflow: $325/mo
• Annual: $3,899/yr
• Cap rate: 14.50%
• Cash-on-cash: 29.32%
• DSCR: 2.30
• 1% rule: 1.80%
• Cash to close: $13,300

Investor read

• This is a 2-bed/1.0-bath single-family listed at $48k.
• At list price, monthly cash flow is $325 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($857 rent vs $48k).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $328 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#133 in IA, #2,464 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: employment C-, amenities F.
• Marshalltown Community School District (town): math 50% / reading 52% proficiency, ranked #278 of 289 in IA (top 96%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; 60% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1906 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 161 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 35 units permitted in Marshall County in 2024 (0 in 5+ unit buildings).
• Marshall County population projected at +8% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $27k; list at $48k implies a 78% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $13k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 14.5% vs local median 4.5% in Marshalltown — 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 is only 15% of the median local income ($70k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• Built in 1906 — 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.
• 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.