5008 Alexander Ave

East Chicago, IN 46312

$132,500B

2 bd · 1.0 ba · 773 sqft · Built 1913 · MultiFamily · Active · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,158/mo
• Mortgage (P&I): −$695
• Tax + insurance: −$175
• HOA: −$0
• Vac / Maint / Mgmt: −$663
• Net cashflow: $1,625/mo
• Annual: $19,495/yr
• Cap rate: 21.01%
• Cash-on-cash: 52.55%
• DSCR: 3.34
• 1% rule: 2.38%
• Cash to close: $37,100

Investor read

• This is a 2×3bd/1ba + 1×2bd/1ba units multifamily listed at $132k.
• At list price, monthly cash flow is $2k ($19k/yr) — positive. Per door: $542/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $132k).
• It's been on market 20 days — a 2% lower offer ($131k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $131k (1.5% below list) — sets the bar for market timing.
• In year one you build about $514 of equity ($916 loan paydown + $-402 appreciation (-0.3% local appreciation)).
• Location reads 64/100 on livability (#371 in IN) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A; Watch: health & safety D+, crime F, amenities F.
• School City Of East Chicago (suburban): math 7% / reading 15% proficiency, ranked #293 of 301 in IN (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 89% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Carrie Gosch Pk Center (150 students, 84% FRL); Joseph Block Middle School (math 3% / reading 13%, grade F, #317 of 330 statewide, top 96%, 487 students, 82% FRL); East Chicago Central High School (math 23% / reading 56%, grade F, #221 of 369 statewide, top 63%, 1,079 students, 77% FRL).
• Zoned-school proficiency averages 24% at this address vs 11% district-wide (+13 pts) — the actual schools serving this property are materially stronger than the School City Of East Chicago average implies; a family-tenant draw the district grade alone would hide.
• Watch-outs: built in 1913 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+8.1%/yr); 79 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 1,642 units permitted in Lake County in 2024 (14 in 5+ unit buildings).
• Lake County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts; this cycle's ask has dropped $18k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-0.3% appreciation + 8.0% rent growth), your $37k cash investment doubles in ~2 years — after that, you're playing with house money.
• Cap rate 21.0% vs local median 8.2% in East Chicago — 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 $3,158/mo this rent would consume 90% of the median local household income ($42k/yr) (locally 1227% 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 1913 — 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?
• 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?
• 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.