115 W 1st Ave S

Estherville, IA 51334

$137,500D

4 bd · 1.5 ba · 1,148 sqft · Built 1940 · SingleFamily · Pending · 156 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,283/mo
• Mortgage (P&I): −$721
• Tax + insurance: −$150
• HOA: −$0
• Vac / Maint / Mgmt: −$269
• Net cashflow: $142/mo
• Annual: $1,710/yr
• Cap rate: 7.54%
• Cash-on-cash: 4.44%
• DSCR: 1.20
• 1% rule: 0.93%
• Cash to close: $38,500

Investor read

• This is a 4-bed/1.5-bath single-family listed at $138k.
• At list price, monthly cash flow is $142 ($2k/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 $128k (6.7% below list).
• It's been on market 156 days — a 12% lower offer ($121k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $121k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $951 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#174 in IA, #3,136 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities D-, commute F.
• Estherville Lincoln Central Community School District (town): math 57% / reading 67% proficiency, ranked #229 of 289 in IA (top 79%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 45 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 11 units permitted in Emmet County in 2024 (0 in 5+ unit buildings).
• Emmet County population projected at -23% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 7.5% vs local median 5.1% in Estherville — 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 156 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1940 — 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.