5200 Holly Ave

Cedar Rapids, IA 52405

$180,000C-

3 bd · 2.0 ba · 1,464 sqft · Built 1958 · SingleFamily · Active · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,584/mo
• Mortgage (P&I): −$944
• Tax + insurance: −$330
• HOA: −$0
• Vac / Maint / Mgmt: −$333
• Net cashflow: $-23/mo
• Annual: $-280/yr
• Cap rate: 6.14%
• Cash-on-cash: -0.55%
• DSCR: 0.98
• 1% rule: 0.88%
• Cash to close: $50,400

Investor read

• This is a 3-bed/2.0-bath single-family listed at $180k.
• At list price, monthly cash flow is $-23 ($-280/yr) — negative.
• To cash-flow at today's rent, offer at most $176k (2.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $158k (12.0% below list).
• It's been on market 20 days — a 2% lower offer ($177k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $158k (12.0% 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 78/100 on livability (#134 in IA, #2,474 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime C-, commute F.
• Cedar Rapids Community School District (urban): math 50% / reading 59% proficiency, ranked #265 of 289 in IA (top 92%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Maple Grove Elementary (math 67% / reading 67%, grade B+, #273 of 616 statewide, top 51%, 529 students, 35% FRL); Taft Middle School (math 60% / reading 63%, grade B+, #179 of 246 statewide, top 73%, 578 students, 38% FRL); Thomas Jefferson High School (math 41% / reading 62%, grade D+, #307 of 336 statewide, top 91%, 1,543 students, 56% FRL) — zoned schools at 43% FRL track the district average.
• Watch-outs: built in 1958 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+12.4%/yr); 149 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 15d on market — plan ~3-4 weeks tenant-placement turnaround); 1,023 units permitted in Linn County in 2024 (456 in 5+ unit buildings).
• Linn County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 7y 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 $137k; 31% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.1% vs local median 3.5% in Cedar Rapids — 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 1958 — 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 B-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.