PRESTON Plan

Hobart, IN 46342

$249,990D-

3 bd · 2.5 ba · 1,601 sqft · Built — · Townhouse · Active · 86 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,109/mo
• Mortgage (P&I): −$1,377
• Tax + insurance: −$438
• HOA: −$0
• Vac / Maint / Mgmt: −$443
• Net cashflow: $-149/mo
• Annual: $-1,784/yr
• Cap rate: 5.61%
• Cash-on-cash: -2.43%
• DSCR: 0.89
• 1% rule: 0.80%
• Cash to close: $73,518

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $250k. Condition is rated good.
• At list price, monthly cash flow is $-149 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $241k (3.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $211k (15.6% below list).
• It's been on market 86 days — a 6% lower offer ($235k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $211k (15.6% below list) — sets the bar for 1% rule.
• 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 69/100 on livability (#196 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B; Watch: schools D, amenities F, commute F.
• School City Of Hobart (suburban): math 30% / reading 45% proficiency, ranked #161 of 301 in IN (top 54%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising fast (+5.6%/yr); 255 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 2d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 1,642 units permitted in Lake County in 2024 (14 in 5+ unit buildings).
• Lake County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Cap rate 5.6% vs local median 4.2% in Hobart — 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.
• This rent runs 34% of the median local income ($76k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 86 days. Have you received any prior offers? Is the seller open to a 16% concession, seller financing, or rate buy-down credit?
• 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?
• 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.