722/724 W Grant Hwy

Marengo, IL 60152

$395,000B-

8 bd · 4.0 ba · — sqft · Built — · MultiFamily · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $8,165/mo
• Mortgage (P&I): −$2,071
• Tax + insurance: −$658
• HOA: −$0
• Vac / Maint / Mgmt: −$1,715
• Net cashflow: $3,721/mo
• Annual: $44,647/yr
• Cap rate: 17.60%
• Cash-on-cash: 40.37%
• DSCR: 2.80
• 1% rule: 2.07%
• Cash to close: $110,600

Investor read

• This is a 4 × 2-bed/?-bath units multifamily listed at $395k. Condition is rated fair.
• At list price, monthly cash flow is $4k ($45k/yr) — positive. Per door: $930/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $395k).
• It's been on market 23 days — a 2% lower offer ($389k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $389k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#708 in IL) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Marengo Chsd 154 (town): math 40% / reading 45% proficiency, ranked #240 of 919 in IL (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Marengo High School (math 37% / reading 37%, grade F, #107 of 693 statewide, top 17%, 685 students, 0% FRL).
• Market conditions: 63 active listings in the ZIP; 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $111k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 17.6% vs local median 4.2% in Marengo — 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

• 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?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.

Repairs flagged (vision-AI assessment)

• Moderate: exterior siding — Weathered and faded
• Moderate: roof — Aged appearance