613 Meadow Pl

Ames, IA 50010

$112,000B+

3 bd · 2.0 ba · 1,260 sqft · Built 1970 · Townhouse · Pending · 52 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,629/mo
• Mortgage (P&I): −$587
• Tax + insurance: −$194
• HOA: −$150
• Vac / Maint / Mgmt: −$342
• Net cashflow: $355/mo
• Annual: $4,262/yr
• Cap rate: 10.10%
• Cash-on-cash: 13.59%
• DSCR: 1.60
• 1% rule: 1.45%
• Cash to close: $31,360

Investor read

• This is a 3-bed/2.0-bath townhouse listed at $112k.
• At list price, monthly cash flow is $355 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $112k).
• It's been on market 52 days — a 3% lower offer ($109k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $109k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $774 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 93/100 on livability (#2 in IA, #21 nationally) — a professional / high-income tenant draw. Strengths: schools A+, amenities A+, commute A+; Watch: employment C-.
• Ames Community School District (urban): math 70% / reading 72% proficiency, ranked #147 of 289 in IA (top 51%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Market conditions: Rents rising (+2.7%/yr); 183 active listings in the ZIP; 3 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; 196 units permitted in Story County in 2024 (34 in 5+ unit buildings).
• Story County population projected at +54% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 6 sale attempts since 13y ago; this cycle's ask has dropped $28k (20%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 2.7% rent growth), your $31k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 10.1% vs local median 2.2% in Ames — 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

• It's been on market 52 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1970 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.