5466 W Sherwood Dr

Newburgh, IN 47630

$265,000D

3 bd · 2.0 ba · 1,857 sqft · Built 1979 · SingleFamily · Pending · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,942/mo
• Mortgage (P&I): −$1,390
• Tax + insurance: −$240
• HOA: −$0
• Vac / Maint / Mgmt: −$408
• Net cashflow: $-95/mo
• Annual: $-1,142/yr
• Cap rate: 5.86%
• Cash-on-cash: -1.54%
• DSCR: 0.93
• 1% rule: 0.73%
• Cash to close: $74,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $265k.
• At list price, monthly cash flow is $-95 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $248k (6.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $194k (26.7% below list).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $194k (26.7% 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 80/100 on livability (#21 in IN, #1,922 nationally) — a professional / high-income tenant draw. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F.
• Warrick County School Corporation (suburban): math 54% / reading 59% proficiency, ranked #24 of 301 in IN (top 8%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Sharon Elementary School (math 65% / reading 62%, grade B, #95 of 994 statewide, top 10%, 686 students, 45% FRL); Castle North Middle School (math 57% / reading 59%, grade B, #18 of 330 statewide, top 5%, 770 students, 22% FRL); Castle High School (math 56% / reading 80%, grade B, #22 of 369 statewide, top 6%, 1,961 students, 26% FRL).
• Market conditions: Rents rising fast (+8.7%/yr); 383 active listings in the ZIP; 10 comparable units currently listed for rent nearby; rentals at typical pace (median 21d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 249 units permitted in Warrick County in 2024 (0 in 5+ unit buildings).
• Warrick County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.9% vs local median 3.9% in Newburgh — 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.

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 1979 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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 for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.