2405 N Frederick Ave #2407

Milwaukee, WI 53211

$404,900C

7 bd · 3.0 ba · 2,555 sqft · Built 1895 · MultiFamily · Active · 100 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,000/mo
• Mortgage (P&I): −$2,123
• Tax + insurance: −$675
• HOA: −$0
• Vac / Maint / Mgmt: −$840
• Net cashflow: $362/mo
• Annual: $4,342/yr
• Cap rate: 7.37%
• Cash-on-cash: 3.83%
• DSCR: 1.17
• 1% rule: 0.99%
• Cash to close: $113,372

Investor read

• This is a 2 × 4-bed/?-bath units multifamily listed at $405k. Condition is rated good.
• At list price, monthly cash flow is $362 ($4k/yr) — positive. Per door: $181/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $400k (1.2% below list).
• It's been on market 100 days — a 9% lower offer ($368k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $368k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#55 in WI, #1,534 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: employment D+, schools F, crime F.
• Milwaukee School District (urban): math 10% / reading 18% proficiency, ranked #337 of 342 in WI (top 98%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 77% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1895 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.5%/yr); 103 active listings in the ZIP; solid renter incomes; 1,017 units permitted in Milwaukee County in 2024 (803 in 5+ unit buildings).
• Milwaukee County population projected at +4% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Cap rate 7.4% vs local median 4.9% in Milwaukee — 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.
• This rent per unit runs 32% of the median local income ($75k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 100 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• 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 1895 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?

Repairs flagged (vision-AI assessment)

• Minor: Kitchen countertops — Painted surfaces could use a fresh coat.
• Minor: Bathroom fixtures — Older fixtures may need updating for a more modern look.
• Minor: Exterior paint — Some minor wear is visible, indicating a need for touch-up or repainting.
• Minor: Landscaping — Minimal landscaping could be improved with some additional greenery or flowers.