401 Highland St

Walnut, IA 51577

$114,500C+

3 bd · 1.0 ba · 793 sqft · Built 1900 · SingleFamily · Active · 29 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $960/mo
• Mortgage (P&I): −$600
• Tax + insurance: −$86
• HOA: −$0
• Vac / Maint / Mgmt: −$202
• Net cashflow: $72/mo
• Annual: $865/yr
• Cap rate: 7.05%
• Cash-on-cash: 2.70%
• DSCR: 1.12
• 1% rule: 0.84%
• Cash to close: $32,060

Investor read

• This is a 3-bed/1.0-bath single-family listed at $114k.
• At list price, monthly cash flow is $72 ($865/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 $96k (16.1% below list).
• It's been on market 29 days — a 2% lower offer ($113k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (16.1% below list) — sets the bar for 1% rule.
• In year one you build about $9k of equity ($792 loan paydown + $8k appreciation (6.8% local appreciation)).
• Location reads 64/100 on livability (#642 in IA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment C-, schools F, amenities F.
• Ahstw Community School District (rural): math 75% / reading 74% proficiency, ranked #76 of 289 in IA (top 26%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 8 active listings in the ZIP; 679 units permitted in Pottawattamie County in 2024 (566 in 5+ unit buildings).
• Pottawattamie County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts 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.
• At projected returns (6.8% appreciation + 3.0% rent growth), your $32k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 5, paydown + projected appreciation supports a ~$38k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

Questions for listing agent

• Built in 1900 — 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.