2604 Fair Oak Ln

McHenry, IL 60051

$269,900D-

2 bd · 2.0 ba · 1,284 sqft · Built 1945 · SingleFamily · Active · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,142/mo
• Mortgage (P&I): −$1,415
• Tax + insurance: −$530
• HOA: −$0
• Vac / Maint / Mgmt: −$450
• Net cashflow: $-253/mo
• Annual: $-3,042/yr
• Cap rate: 5.17%
• Cash-on-cash: -4.02%
• DSCR: 0.82
• 1% rule: 0.79%
• Cash to close: $75,572

Investor read

• This is a 2-bed/2.0-bath single-family listed at $270k.
• At list price, monthly cash flow is $-253 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $225k (16.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $214k (20.6% below list).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $214k (20.6% below list) — sets the bar for 1% rule.
• In year one you build about $29k of equity ($2k loan paydown + $27k appreciation (10.0% local appreciation)).
• Location reads 76/100 on livability (#205 in IL, #3,749 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, housing A+, health & safety A+; Watch: schools D+, amenities D-, commute F.
• Mchenry Chsd 156 (suburban): math 27% / reading 30% proficiency, ranked #244 of 620 in IL (top 39%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 152 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 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.
• 5 sale attempts since 13y 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.
• Current owner paid $38k; list at $270k implies a 610% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$46k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 5.2% vs local median 3.6% in McHenry — 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• Built in 1945 — 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?
• 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.