416 Montgomery St

Shelbyville, IN 46176

$139,900B

4 bd · 2.0 ba · 1,680 sqft · Built 2001 · SingleFamily · Active · 40 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,768/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$148
• HOA: −$0
• Vac / Maint / Mgmt: −$371
• Net cashflow: $515/mo
• Annual: $6,176/yr
• Cap rate: 10.71%
• Cash-on-cash: 15.77%
• DSCR: 1.70
• 1% rule: 1.26%
• Cash to close: $39,172

Investor read

• This is a 4-bed/2.0-bath single-family listed at $140k.
• At list price, monthly cash flow is $515 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $140k).
• It's been on market 40 days — a 3% lower offer ($136k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $136k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#450 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B; Watch: employment C-, amenities F, commute F.
• Shelbyville Central Schools (town): math 40% / reading 39% proficiency, ranked #148 of 301 in IN (top 49%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Shelbyville Sr High School (math 31% / reading 60%, grade D-, #164 of 369 statewide, top 45%, 1,101 students, 57% FRL).
• Market conditions: 229 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 285 units permitted in Shelby County in 2024 (147 in 5+ unit buildings).
• Shelby County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 3y ago; this cycle's ask has dropped $18k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $39k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 10.7% vs local median 4.3% in Shelbyville — 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 runs 33% of the median local income ($65k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 40 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.