704 W Grant Hwy

Marengo, IL 60152

$195,999D+

2 bd · 1.0 ba · 1,100 sqft · Built — · SingleFamily · Active · 26 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,890/mo
• Mortgage (P&I): −$1,028
• Tax + insurance: −$382
• HOA: −$0
• Vac / Maint / Mgmt: −$397
• Net cashflow: $83/mo
• Annual: $998/yr
• Cap rate: 6.80%
• Cash-on-cash: 1.82%
• DSCR: 1.08
• 1% rule: 0.96%
• Cash to close: $54,880

Investor read

• This is a 2-bed/1.0-bath single-family listed at $196k.
• At list price, monthly cash flow is $83 ($998/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 $189k (3.5% below list).
• It's been on market 26 days — a 2% lower offer ($193k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $189k (3.5% 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 64/100 on livability (#708 in IL) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Marengo Chsd 154 (town): math 40% / reading 45% proficiency, ranked #240 of 919 in IL (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Locust Elem School (math 47% / reading 32%, grade F, #392 of 2,056 statewide, top 21%, 535 students, 0% FRL); Marengo Comm Middle School (math 25% / reading 31%, grade F, #284 of 665 statewide, top 44%, 307 students, 0% FRL); Marengo High School (math 37% / reading 37%, grade F, #107 of 693 statewide, top 17%, 685 students, 0% FRL).
• Market conditions: 64 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 1d on market — plan ~1-2 weeks tenant-placement turnaround); 1,595 units permitted in McHenry County in 2024 (485 in 5+ unit buildings).
• McHenry County population projected at -12% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $128k; list at $196k implies a 54% gain — meaningful room to come down on a strong offer.
• Cap rate 6.8% vs local median 4.2% in Marengo — 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

• 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.