2721 Palo Verde Ct

Indianapolis city (balance), IN 46227

$119,000C+

3 bd · 1.0 ba · 1,544 sqft · Built 1978 · Condo · Active · 12 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,624/mo
• Mortgage (P&I): −$624
• Tax + insurance: −$158
• HOA: −$178
• Vac / Maint / Mgmt: −$341
• Net cashflow: $323/mo
• Annual: $3,873/yr
• Cap rate: 9.55%
• Cash-on-cash: 11.62%
• DSCR: 1.52
• 1% rule: 1.36%
• Cash to close: $33,320

Investor read

• This is a 3-bed/1.0-bath condo listed at $119k.
• At list price, monthly cash flow is $323 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $119k).
• Only 12 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $823 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads: area grade C — affects rentability + tenant quality, not the cash-flow math above.
• Perry Township Schools (urban): math 36% / reading 45% proficiency, ranked #138 of 301 in IN (top 46%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Winchester Village Elementary (math 28% / reading 26%, grade F, #737 of 994 statewide, top 76%, 619 students, 85% FRL); Southport Middle School (math 22% / reading 40%, grade F, #201 of 330 statewide, top 61%, 1,194 students, 72% FRL); Southport High School (math 25% / reading 53%, grade F, #235 of 369 statewide, top 65%, 2,355 students, 70% FRL) — zoned schools average 76% FRL vs 54% district-wide (22 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+2.5%/yr); 248 active listings in the ZIP; 22 comparable units currently listed for rent nearby; rentals leasing fast (median 12d on market — plan ~1-2 weeks tenant-placement turnaround); 1,906 units permitted in Marion County in 2024 (621 in 5+ unit buildings).
• Marion County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 10y ago 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 $42k; list at $119k implies a 183% gain — meaningful room to come down on a strong offer.
• Cap rate 9.5% vs local median 4.4% in Indianapolis city (balance) — 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 36% of the median local income ($54k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1978 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.