223 W Locust St

DeKalb, IL 60115

$265,000D-

8 bd · 3.0 ba · — sqft · Built 1920 · Other · Active · 343 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,243/mo
• Mortgage (P&I): −$1,390
• Tax + insurance: −$619
• HOA: −$0
• Vac / Maint / Mgmt: −$471
• Net cashflow: $-236/mo
• Annual: $-2,834/yr
• Cap rate: 5.22%
• Cash-on-cash: -3.82%
• DSCR: 0.83
• 1% rule: 0.85%
• Cash to close: $74,200

Investor read

• This is a 8-bed/3.0-bath other listed at $265k.
• At list price, monthly cash flow is $-236 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $223k (15.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $224k (15.3% below list).
• It's been on market 343 days — a 12% lower offer ($233k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $223k (15.7% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#154 in IL, #2,835 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities D+, schools D, crime D-.
• Dekalb CUSD 428 (suburban): math 11% / reading 16% proficiency, ranked #541 of 620 in IL (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+7.3%/yr); 85 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 260 units permitted in DeKalb County in 2024 (73 in 5+ unit buildings).
• DeKalb County population projected to shrink 5% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 6 sale attempts since 3y ago; this cycle's ask has dropped $30k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At $2,243/mo this rent would consume 57% of the median local household income ($47k/yr) (locally 3794% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• It's been on market 343 days. Have you received any prior offers? Is the seller open to a 16% concession, seller financing, or rate buy-down credit?
• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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?
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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?