Boone County

Boone County's headline numbers tell a mixed story. At a median home price of $237,632 and median rent of $1,053, the gross rent-to-price ratio comes in at 0.53%, which annualizes to a 6.4% gross yield before expenses. The modeled cap rate of 3.45% tells you that after operating expenses, this market barely clears the bar most serious investors set as a floor. The modeled cash flow is negative $562 per month on a 20% down conventional loan at 6.85%, producing a cash-on-cash return of -12.34%. Those numbers are not a rounding error, they are a structural feature of where this market sits right now. The appreciation score of 85 and year-over-year home price growth of 4.64% confirm what the cap rate already implies: Boone is pricing like an appreciation market, not an income market. The overall score of 64 and national percentile rank of 65 out of 1,000 counties puts it in the upper third nationally, but that ranking reflects the appreciation trajectory more than current cash flow.

The buyer this market suits is an appreciation-oriented hold with patience and a long time horizon, not a cash-flow investor underwriting to month-one breakeven. The affordability index of 79 and median price of $237,632 suggest prices are not yet stretched relative to incomes, which supports continued price appreciation without the fragility that comes with overextended markets. A cash-flow buyer running a standard 20% down, 30-year fixed structure will be negative from day one under current rate conditions. A value-add operator looking to force appreciation through renovation may find the raw entry price accessible, but the rent ceiling of roughly $1,053 at the county median means there is limited upside on gross revenue without significant repositioning. The more straightforward case is a buy-and-hold investor willing to accept near-term negative carry in exchange for 4%-plus annual price appreciation in an affordable Midwest market.

Iowa's property tax burden is a material underwriting consideration here. At a state-average effective rate of 1.53%, Iowa sits in the high category, and that translates to $3,636 in estimated annual property taxes on the median-priced asset, or $303 per month. Combined with estimated insurance of $67 per month, the tax-and-insurance line alone runs $370 per month, which is included in the $369 estimated expenses figure in the model. That figure deserves its own line on your underwrite, because at 1.53% the tax burden is high enough to materially compress net operating income relative to states in the 0.8% to 1.0% range. The caveat is worth taking seriously: the 1.53% figure is a state-average estimate from the Tax Foundation (2024), and actual Boone County or township-level rates may differ, so pull the county assessor data before closing.

Compared to neighboring counties, Boone sits in the middle of the pack on price but above average on rent. Scott County comes closest as an apples-to-apples comparison: similar median price ($233,631), similar median rent ($1,060), and a marginally better rent-to-price ratio of 0.544% versus Boone's 0.532%. Scott's overall score of 63 versus Boone's 64 is essentially a tie. Jasper County is slightly cheaper at $233,695 but produces a lower median rent of $951 and a weaker rent-to-price ratio of 0.488%, making it a worse income option despite the lower entry point. Lee County at $117,640 is the outlier on price, and investors hunting for deep affordability and potentially stronger gross yields should investigate it separately, though no rent or ratio data is available here to confirm that thesis. Madison County at $328,942 is the most expensive neighbor and carries a higher overall score of 65, suggesting it may be the stronger appreciation play if the higher entry price is acceptable. Choose Boone over Scott if you have a specific reason to favor the Boone County submarket, since the two are nearly equivalent on the numbers. Choose Boone over Jasper if rent level matters more than entry price, since Boone's $1,053 median rent outperforms Jasper's $951 despite a comparable purchase price.

The primary risk to underline is concentration. Boone County's population of 26,700 means this is a small market, and rental demand is correspondingly narrow. A single employer contraction or demographic outflow can move vacancy and rent levels faster than in larger metro markets. The stability score of 50 reflects that, sitting at the midpoint rather than signaling resilience. Cash-flow scores of 50 reinforce that this market does not offer a margin of safety on income; if rents soften or rates stay elevated, a buy-and-hold strategy tips further negative before it recovers. Investors who need current income to service debt or fund operations should treat the modeled -$562 monthly cash flow as a hard constraint, not a projection to optimize around.