1000 1st Ave S

Clear Lake, IA 50428

$171,900D+

4 bd · 2.0 ba · 1,334 sqft · Built 1930 · SingleFamily · Active · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,387/mo
• Mortgage (P&I): −$901
• Tax + insurance: −$218
• HOA: −$0
• Vac / Maint / Mgmt: −$291
• Net cashflow: $-24/mo
• Annual: $-282/yr
• Cap rate: 6.13%
• Cash-on-cash: -0.59%
• DSCR: 0.97
• 1% rule: 0.81%
• Cash to close: $48,132

Investor read

• This is a 4-bed/2.0-bath single-family listed at $172k.
• At list price, monthly cash flow is $-24 ($-282/yr) — negative.
• To cash-flow at today's rent, offer at most $168k (2.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $139k (19.3% below list).
• It's been on market 22 days — a 2% lower offer ($169k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $139k (19.3% 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 $5k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#25 in IA, #735 nationally) — a professional / high-income tenant draw. Strengths: schools A+, cost of living A+, housing A+; Watch: amenities D-, commute F.
• Clear Lake Community School District (town): math 66% / reading 76% proficiency, ranked #128 of 289 in IA (top 44%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 112 active listings in the ZIP; 54 units permitted in Cerro Gordo County in 2024 (6 in 5+ unit buildings).
• Cerro Gordo County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 5 sale attempts since 11y ago; this cycle's ask has dropped $56k (25%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $65k; list at $172k implies a 164% gain — meaningful room to come down on a strong offer.
• Cap rate 6.1% vs local median 1.1% in Clear Lake — 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 1930 — 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.