619 Morgan St

Keokuk, IA 52632

$49,000B

5 bd · 2.0 ba · 2,868 sqft · Built 1870 · MultiFamily · Active · 496 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,148/mo
• Mortgage (P&I): −$257
• Tax + insurance: −$72
• HOA: −$0
• Vac / Maint / Mgmt: −$241
• Net cashflow: $578/mo
• Annual: $6,932/yr
• Cap rate: 20.44%
• Cash-on-cash: 50.52%
• DSCR: 3.25
• 1% rule: 2.34%
• Cash to close: $13,720

Investor read

• This is a 5-bed/2.0-bath multifamily listed at $49k.
• At list price, monthly cash flow is $578 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $49k).
• It's been on market 496 days — a 12% lower offer ($43k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $43k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $339 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#166 in IA, #3,002 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities C-, commute F, employment F.
• Keokuk Community School District (town): math 48% / reading 54% proficiency, ranked #282 of 289 in IA (top 98%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Hawthorne Elementary School (math 62% / reading 37%, grade D, #514 of 616 statewide, top 85%, 464 students, 68% FRL); Keokuk Middle School (math 45% / reading 48%, grade D+, #230 of 246 statewide, top 93%, 377 students, 60% FRL); Keokuk High School (math 48% / reading 63%, grade C, #287 of 336 statewide, top 86%, 598 students, 53% FRL).
• Watch-outs: built in 1870 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 74 active listings in the ZIP; 15 units permitted in Lee County in 2024 (0 in 5+ unit buildings).
• Lee County population projected at -15% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 9 sale attempts since 6y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $12k; list at $49k implies a 292% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $14k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 20.4% vs local median 8.2% in Keokuk — 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 496 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1870 — 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.
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.