202/204 S Sterling Ave

Sugar Creek, MO 64054

$275,000F

4 bd · 2.0 ba · 1,617 sqft · Built 1959 · MultiFamily · Active · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,120/mo
• Mortgage (P&I): −$1,442
• Tax + insurance: −$306
• HOA: −$0
• Vac / Maint / Mgmt: −$445
• Net cashflow: $-73/mo
• Annual: $-881/yr
• Cap rate: 5.97%
• Cash-on-cash: -1.14%
• DSCR: 0.95
• 1% rule: 0.77%
• Cash to close: $77,000

Investor read

• This is a 2 × 2-bed/1-bath units multifamily listed at $275k.
• At list price, monthly cash flow is $-73 ($-881/yr) — negative. Per door: $-37/mo.
• To cash-flow at today's rent, offer at most $262k (4.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $212k (22.9% below list).
• It's been on market 17 days — a 2% lower offer ($271k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $212k (22.9% 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 65/100 on livability (#261 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A-, commute B; Watch: schools F, crime F, amenities F.
• Independence 30 (suburban): math 26% / reading 38% proficiency, ranked #252 of 324 in MO (top 78%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1959 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 24 active listings in the ZIP; 13 comparable units currently listed for rent nearby; rentals at typical pace (median 18d on market — plan ~3-4 weeks tenant-placement turnaround); 4,002 units permitted in Jackson County in 2024 (2,271 in 5+ unit buildings).
• Jackson County population projected at +4% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 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.
• This rent runs 43% of the median local income ($60k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• 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 1959 — 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 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?
• 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?