608 S Carolina Ave Ave

Mason City, IA 50401

$189,000D+

5 bd · 2.0 ba · 2,262 sqft · Built 1916 · SingleFamily · Active · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,551/mo
• Mortgage (P&I): −$991
• Tax + insurance: −$211
• HOA: −$0
• Vac / Maint / Mgmt: −$326
• Net cashflow: $23/mo
• Annual: $274/yr
• Cap rate: 6.44%
• Cash-on-cash: 0.52%
• DSCR: 1.02
• 1% rule: 0.82%
• Cash to close: $52,920

Investor read

• This is a 5-bed/2.0-bath single-family listed at $189k.
• At list price, monthly cash flow is $23 ($274/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 $155k (17.9% below list).
• It's been on market 16 days — a 2% lower offer ($186k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $155k (17.9% 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 $6k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#67 in IA, #1,477 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities F.
• Mason City Community School District (town): math 50% / reading 58% proficiency, ranked #271 of 289 in IA (top 94%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1916 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 158 active listings in the ZIP; 54 units permitted in Cerro Gordo County in 2024 (6 in 5+ unit buildings).
• Cerro Gordo County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 2y 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 $150k; 26% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.4% vs local median 5.3% in Mason City — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

Questions for listing agent

• Built in 1916 — 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.
• 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.