226 E Penning Ave

Wood River, IL 62095

$189,000D-

5 bd · 1.0 ba · 1,540 sqft · Built 1920 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,767/mo
• Mortgage (P&I): −$991
• Tax + insurance: −$289
• HOA: −$0
• Vac / Maint / Mgmt: −$371
• Net cashflow: $116/mo
• Annual: $1,392/yr
• Cap rate: 7.03%
• Cash-on-cash: 2.63%
• DSCR: 1.12
• 1% rule: 0.94%
• Cash to close: $52,920

Investor read

• This is a 5-bed/1.0-bath single-family listed at $189k.
• At list price, monthly cash flow is $116 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $177k (6.5% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $177k (6.5% below list) — sets the bar for 1% rule.
• 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 75/100 on livability (#214 in IL, #4,027 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety B; Watch: amenities C-, commute D+, employment D+.
• East Alton-Wood River Chsd 14 (suburban): math 10% / reading 20% proficiency, ranked #793 of 919 in IL (top 86%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Lewis-Clark Elem School (math 22% / reading 22%, grade F, #940 of 2,056 statewide, top 49%, 231 students, 0% FRL); Lewis-Clark Jr High School (math 8% / reading 17%, grade F, #550 of 665 statewide, top 84%, 195 students, 0% FRL); East Alton-Wood River High Sch (math 8% / reading 12%, grade F, #567 of 693 statewide, top 83%, 537 students, 0% FRL).
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 33 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 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 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.
• Current owner paid $99k; list at $189k implies a 91% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• This rent runs 33% of the median local income ($65k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• 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 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?
• 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.