400 E Prairie St

Centerville, IA 52544

$115,000C-

2 bd · 1.0 ba · 1,235 sqft · Built 1918 · Other · Active · 24 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,052/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$154
• HOA: −$0
• Vac / Maint / Mgmt: −$221
• Net cashflow: $74/mo
• Annual: $889/yr
• Cap rate: 7.07%
• Cash-on-cash: 2.76%
• DSCR: 1.12
• 1% rule: 0.92%
• Cash to close: $32,200

Investor read

• This is a 2-bed/1.0-bath other listed at $115k.
• At list price, monthly cash flow is $74 ($889/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $105k (8.5% below list).
• It's been on market 24 days — a 2% lower offer ($113k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $105k (8.5% below list) — sets the bar for 1% rule.
• In year one you build about $2k of equity ($795 loan paydown + $1k appreciation (1.1% local appreciation)).
• Location reads 73/100 on livability (#277 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities F, commute F, employment F.
• Centerville Community School District (town): math 57% / reading 65% proficiency, ranked #251 of 289 in IA (top 87%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Lakeview Elementary (math 57% / reading 60%, grade B-, #432 of 616 statewide, top 71%, 575 students, 50% FRL); Howar Middle School (math 57% / reading 66%, grade B+, #179 of 246 statewide, top 73%, 299 students, 50% FRL); Centerville High School (math 58% / reading 71%, grade B-, #211 of 336 statewide, top 70%, 404 students, 44% FRL).
• Watch-outs: built in 1918 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 83 active listings in the ZIP; 6 units permitted in Appanoose County in 2024 (0 in 5+ unit buildings).
• Appanoose County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $44k; list at $115k implies a 161% gain — meaningful room to come down on a strong offer.
• At projected returns (1.1% appreciation + 3.0% rent growth), your $32k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 7.1% vs local median 4.0% in Centerville — 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

• Built in 1918 — 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 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.