1011 State St

Alton, IL 62002

$225,000C

6 bd · 4.0 ba · 3,826 sqft · Built 1963 · MultiFamily · Active · 104 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,800/mo
• Mortgage (P&I): −$1,180
• Tax + insurance: −$367
• HOA: −$0
• Vac / Maint / Mgmt: −$588
• Net cashflow: $665/mo
• Annual: $7,984/yr
• Cap rate: 9.84%
• Cash-on-cash: 12.67%
• DSCR: 1.56
• 1% rule: 1.24%
• Cash to close: $63,000

Investor read

• This is a 2 × 3-bed/?-bath units multifamily listed at $225k.
• At list price, monthly cash flow is $665 ($8k/yr) — positive. Per door: $333/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $225k).
• It's been on market 104 days — a 9% lower offer ($205k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $205k (9.0% below list) — sets the bar for market timing.
• 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 64/100 on livability (#701 in IL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A; Watch: health & safety C-, schools F, crime F.
• Alton CUSD 11 (suburban): math 12% / reading 13% proficiency, ranked #544 of 620 in IL (top 88%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 60% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+8.2%/yr); 169 active listings in the ZIP; 336 units permitted in Madison County in 2024 (0 in 5+ unit buildings).
• Madison County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts since 2y 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 $99k; list at $225k implies a 127% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $63k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 9.8% vs local median 6.4% in Alton — 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 $2,800/mo this rent would consume 55% of the median local household income ($61k/yr) (locally 960% 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 104 days. Have you received any prior offers? Is the seller open to a 9% 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 1963 — 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?