521 10th Street St

Fort Madison, IA 52627

$164,900B

3 bd · 2.0 ba · 2,712 sqft · Built 1870 · MultiFamily · Active · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,418/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$189
• HOA: −$0
• Vac / Maint / Mgmt: −$508
• Net cashflow: $856/mo
• Annual: $10,273/yr
• Cap rate: 12.52%
• Cash-on-cash: 22.25%
• DSCR: 1.99
• 1% rule: 1.47%
• Cash to close: $46,172

Investor read

• This is a 3-bed/2.0-bath multifamily listed at $165k.
• At list price, monthly cash flow is $856 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $165k).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• 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 75/100 on livability (#230 in IA, #4,353 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: commute F, employment D-.
• Fort Madison Community School District (town): math 55% / reading 58% proficiency, ranked #260 of 289 in IA (top 90%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1870 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 64 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.
• Current owner paid $40k; list at $165k implies a 312% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $46k cash investment doubles in ~6 years — after that, you're playing with house money.
• Cap rate 12.5% vs local median 5.3% in Fort Madison — 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 1870 — 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 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.