2271 Hamstrom Rd

Portage, IN 46368

$198,000C-

3 bd · 1.5 ba · 1,167 sqft · Built 1960 · SingleFamily · Active · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,801/mo
• Mortgage (P&I): −$1,038
• Tax + insurance: −$252
• HOA: −$0
• Vac / Maint / Mgmt: −$378
• Net cashflow: $132/mo
• Annual: $1,587/yr
• Cap rate: 7.09%
• Cash-on-cash: 2.86%
• DSCR: 1.13
• 1% rule: 0.91%
• Cash to close: $55,440

Investor read

• This is a 3-bed/1.5-bath single-family listed at $198k.
• At list price, monthly cash flow is $132 ($2k/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 $180k (9.0% below list).
• It's been on market 20 days — a 2% lower offer ($195k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $180k (9.0% 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 72/100 on livability (#111 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A; Watch: schools D, amenities F, commute F.
• Portage Township Schools (suburban): math 26% / reading 36% proficiency, ranked #221 of 301 in IN (top 73%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising fast (+4.3%/yr); 311 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 542 units permitted in Porter County in 2024 (0 in 5+ unit buildings).
• Porter County population projected at +6% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 8 sale attempts since 27y 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.
• Cap rate 7.1% vs local median 4.0% in Portage — 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

• Built in 1960 — 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 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.