538 Mcdonough St

Eau Claire, WI 54703

$206,000D-

3 bd · 1.0 ba · 1,008 sqft · Built 1886 · SingleFamily · Active · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,674/mo
• Mortgage (P&I): −$1,080
• Tax + insurance: −$227
• HOA: −$0
• Vac / Maint / Mgmt: −$352
• Net cashflow: $15/mo
• Annual: $181/yr
• Cap rate: 6.38%
• Cash-on-cash: 0.31%
• DSCR: 1.01
• 1% rule: 0.81%
• Cash to close: $57,680

Investor read

• This is a 3-bed/1.0-bath single-family listed at $206k.
• At list price, monthly cash flow is $15 ($181/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 $167k (18.7% below list).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $167k (18.7% 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 89/100 on livability (#10 in WI, #121 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, cost of living A+, housing A+.
• Eau Claire Area School District (urban): math 38% / reading 43% proficiency, ranked #150 of 342 in WI (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1886 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.0%/yr); 212 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); 44% of comp listings sitting > 30 days — soft ceiling on asking rent; 583 units permitted in Eau Claire County in 2024 (325 in 5+ unit buildings).
• Eau Claire County population projected at +14% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts 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 $40k; list at $206k implies a 415% gain — meaningful room to come down on a strong offer.
• Cap rate 6.4% vs local median 2.4% in Eau Claire — 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 1886 — 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 B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.