1046 Merrill St

Hammond, IN 46320

$330,500D-

4 bd · 2.5 ba · 2,362 sqft · Built 1981 · SingleFamily · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,168/mo
• Mortgage (P&I): −$1,733
• Tax + insurance: −$215
• HOA: −$0
• Vac / Maint / Mgmt: −$455
• Net cashflow: $-235/mo
• Annual: $-2,824/yr
• Cap rate: 5.44%
• Cash-on-cash: -3.05%
• DSCR: 0.86
• 1% rule: 0.66%
• Cash to close: $92,540

Investor read

• This is a 4-bed/2.5-bath single-family listed at $330k.
• At list price, monthly cash flow is $-235 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $289k (12.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $217k (34.4% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $217k (34.4% below list) — sets the bar for 1% rule.
• In year one you build about $35k of equity ($2k loan paydown + $33k appreciation (10.0% local appreciation)).
• Location reads 70/100 on livability (#143 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, commute A; Watch: health & safety D+, employment D, crime F.
• School City Of Hammond (suburban): math 8% / reading 18% proficiency, ranked #289 of 301 in IN (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 74% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Annie Burns-Hicks Elementary School (math 8% / reading 9%, grade F, #939 of 994 statewide, top 95%, 669 students, 77% FRL); Henry W Eggers Middle School (math 5% / reading 17%, grade F, #312 of 330 statewide, top 95%, 855 students, 76% FRL); Hammond Central High School (math 8% / reading 37%, grade F, #339 of 369 statewide, top 93%, 1,863 students, 73% FRL) — zoned schools at 75% FRL track the district average.
• Market conditions: Rents rising fast (+7.6%/yr); 51 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 1d on market — plan ~1-2 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 1,642 units permitted in Lake County in 2024 (14 in 5+ unit buildings).
• Lake County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts 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.
• By year 2, paydown + projected appreciation supports a ~$57k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• At $2,168/mo this rent would consume 70% of the median local household income ($37k/yr) (locally 900% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• 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?
• 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.