1602 Hillcrest Rd

East Cleveland, OH 44118

$139,900C-

6 bd · 3.0 ba · 3,235 sqft · Built 1919 · MultiFamily · Active · 233 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,119/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$237
• HOA: −$0
• Vac / Maint / Mgmt: −$1,285
• Net cashflow: $3,863/mo
• Annual: $46,356/yr
• Cap rate: 39.43%
• Cash-on-cash: 118.34%
• DSCR: 6.27
• 1% rule: 4.37%
• Cash to close: $39,172

Investor read

• This is a 3 × 5-bed/3.0-bath units multifamily listed at $140k.
• At list price, monthly cash flow is $4k ($46k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $140k).
• It's been on market 233 days — a 12% lower offer ($123k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $123k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#650 in OH) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, health & safety A+; Watch: schools F, crime F, employment F.
• East Cleveland City School District (suburban): math 4% / reading 17% proficiency, ranked #652 of 656 in OH (top 99%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 92% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1919 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.7%/yr); 258 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 17d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 1,441 units permitted in Cuyahoga County in 2024 (700 in 5+ unit buildings).
• Cuyahoga County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 4 sale attempts since 34y ago; this cycle's ask has dropped $40k (22%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $62k; list at $140k implies a 126% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 5.7% rent growth), your $39k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 39.4% vs local median 17.4% in East Cleveland — 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.
• At $6,119/mo this rent would consume 95% of the median local household income ($78k/yr) (locally 1847% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 233 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1919 — 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 F-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 F 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?