3698 Menlo Rd

Shaker Heights, OH 44120

$219,900C

4 bd · 2.0 ba · 2,111 sqft · Built 1925 · MultiFamily · Active · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,914/mo
• Mortgage (P&I): −$1,153
• Tax + insurance: −$683
• HOA: −$0
• Vac / Maint / Mgmt: −$612
• Net cashflow: $466/mo
• Annual: $5,594/yr
• Cap rate: 8.84%
• Cash-on-cash: 9.09%
• DSCR: 1.40
• 1% rule: 1.33%
• Cash to close: $61,572

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $220k.
• At list price, monthly cash flow is $466 ($6k/yr) — positive. Per door: $233/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $220k).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 89/100 on livability (#15 in OH, #134 nationally) — a professional / high-income tenant draw. Strengths: crime A+, commute A+, employment A+; Watch: amenities F.
• Shaker Heights City (suburban): math 50% / reading 63% proficiency, ranked #309 of 656 in OH (top 47%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Mercer Elementary School (math 62% / reading 57%, grade B-, #670 of 1,584 statewide, top 45%, 307 students, 27% FRL); Shaker Hts Middle School (math 49% / reading 56%, grade C+, #378 of 654 statewide, top 59%, 651 students, 30% FRL); Shaker Hts High School (math 34% / reading 70%, grade D+, #343 of 781 statewide, top 47%, 1,498 students, 24% FRL) — zoned schools at 27% FRL track the district average.
• Watch-outs: property tax is 3.2% of price; built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.3%/yr); 128 active listings in the ZIP; 22 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); 1,441 units permitted in Cuyahoga County in 2024 (700 in 5+ unit buildings).
• Cuyahoga County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 10 sale attempts since 24y 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 $155k; 42% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 8.8% vs local median 2.5% in Shaker Heights — 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.
• At $2,914/mo this rent would consume 74% of the median local household income ($47k/yr) (locally 2289% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1925 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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.