1203 1st Ave

Charles City, IA 50616

$197,000D

3 bd · 1.5 ba · 1,676 sqft · Built 1976 · SingleFamily · Pending · 256 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,927/mo
• Mortgage (P&I): −$1,033
• Tax + insurance: −$277
• HOA: −$0
• Vac / Maint / Mgmt: −$405
• Net cashflow: $212/mo
• Annual: $2,548/yr
• Cap rate: 7.59%
• Cash-on-cash: 4.62%
• DSCR: 1.21
• 1% rule: 0.98%
• Cash to close: $55,160

Investor read

• This is a 3-bed/1.5-bath single-family listed at $197k.
• At list price, monthly cash flow is $212 ($3k/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 $193k (2.2% below list).
• It's been on market 256 days — a 12% lower offer ($173k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $173k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#161 in IA, #2,944 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A; Watch: amenities F, commute F, employment F.
• Charles City Community School District (town): math 52% / reading 61% proficiency, ranked #262 of 289 in IA (top 91%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Charles City Ms (math 51% / reading 59%, grade B-, #201 of 246 statewide, top 82%, 423 students, 54% FRL); Charles City High School (math 47% / reading 67%, grade C, #279 of 336 statewide, top 85%, 534 students, 47% FRL).
• Market conditions: 71 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 38 units permitted in Floyd County in 2024 (0 in 5+ unit buildings).
• Floyd County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.

Questions for listing agent

• It's been on market 256 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1976 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.