540 Shorely Dr #104

Barrington, IL 60010

$230,000D

2 bd · 2.0 ba · 1,100 sqft · Built 1971 · Condo · Contingent - Continue to Show · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,454/mo
• Mortgage (P&I): −$1,206
• Tax + insurance: −$383
• HOA: −$447
• Vac / Maint / Mgmt: −$515
• Net cashflow: $-98/mo
• Annual: $-1,178/yr
• Cap rate: 5.78%
• Cash-on-cash: -1.83%
• DSCR: 0.92
• 1% rule: 1.07%
• Cash to close: $64,400

Investor read

• This is a 2-bed/2.0-bath condo listed at $230k.
• At list price, monthly cash flow is $-98 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $216k (6.2% below list).
• Meets the 1% rule at list price ($2k rent vs $230k).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $216k (6.2% 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 $7k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#156 in IL, #2,854 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, schools A; Watch: health & safety D+, amenities D-, cost of living F.
• Barrington CUSD 220 (suburban): math 46% / reading 49% proficiency, ranked #42 of 620 in IL (top 7%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; only 16% free/reduced lunch — higher-income household profile.
• Market conditions: 245 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 948 units permitted in Lake County in 2024 (424 in 5+ unit buildings).
• Lake County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Cap rate 5.8% vs local median 2.4% in Barrington — 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 is only 17% of the median local income ($178k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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?
• Built in 1971 — 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.
• Schools are A-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.