2304 Thor Ave

Racine, WI 53405

$214,900C

3 bd · 2.0 ba · 1,710 sqft · Built 1920 · MultiFamily · Active · 41 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,745/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$412
• HOA: −$0
• Vac / Maint / Mgmt: −$576
• Net cashflow: $629/mo
• Annual: $7,551/yr
• Cap rate: 9.81%
• Cash-on-cash: 12.55%
• DSCR: 1.56
• 1% rule: 1.28%
• Cash to close: $60,172

Investor read

• This is a 2 × 3-bed/2.0-bath units multifamily listed at $215k.
• At list price, monthly cash flow is $629 ($8k/yr) — positive. Per door: $315/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $215k).
• It's been on market 41 days — a 3% lower offer ($208k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $208k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#58 in WI, #1,622 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: employment D, schools D-.
• Racine Unified School District (urban): math 12% / reading 20% proficiency, ranked #335 of 342 in WI (top 98%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 45 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); 505 units permitted in Racine County in 2024 (287 in 5+ unit buildings).
• Racine County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 7 sale attempts since 14y ago; this cycle's ask has dropped $15k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $60k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 9.8% vs local median 4.0% in Racine — 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 $2,745/mo this rent would consume 48% of the median local household income ($69k/yr) (locally 430% 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 41 days. Have you received any prior offers? Is the seller open to a 3% 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 1920 — 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.