897 E Lake St #115

Lake Mills, WI 53551

$115,000B-

2 bd · 1.0 ba · 864 sqft · Built 2017 · SingleFamily · Pending · 26 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,426/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$192
• HOA: −$0
• Vac / Maint / Mgmt: −$299
• Net cashflow: $332/mo
• Annual: $3,981/yr
• Cap rate: 9.75%
• Cash-on-cash: 12.36%
• DSCR: 1.55
• 1% rule: 1.24%
• Cash to close: $32,200

Investor read

• This is a 2-bed/1.0-bath single-family listed at $115k. Condition is rated good.
• At list price, monthly cash flow is $332 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $115k).
• It's been on market 26 days — a 2% lower offer ($113k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $113k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $795 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#68 in WI, #1,833 nationally) — a professional / high-income tenant draw. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F.
• Lake Mills Area School District (town): math 38% / reading 39% proficiency, ranked #152 of 342 in WI (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 36 active listings in the ZIP; 145 units permitted in Jefferson County in 2024 (0 in 5+ unit buildings).
• Jefferson County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $32k cash investment doubles in ~10 years — after that, you're playing with house money.
• Cap rate 9.8% vs local median 1.6% in Lake Mills — 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

• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.