127 Walnut Hill Dr

The Galena Territory, IL 61036

$124,900C-

1 bd · 2.0 ba · 875 sqft · Built 1989 · Other · Active · 274 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,584/mo
• Mortgage (P&I): −$655
• Tax + insurance: −$281
• HOA: −$305
• Vac / Maint / Mgmt: −$333
• Net cashflow: $10/mo
• Annual: $124/yr
• Cap rate: 6.39%
• Cash-on-cash: 0.35%
• DSCR: 1.02
• 1% rule: 1.27%
• Cash to close: $34,972

Investor read

• This is a 1-bed/2.0-bath other listed at $125k.
• At list price, monthly cash flow is $10 ($124/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $125k).
• It's been on market 274 days — a 12% lower offer ($110k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $110k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $864 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#313 in IL) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: health & safety C-, schools D+, amenities F.
• Scales Mound CUSD 211 (rural): math 45% / reading 45% proficiency, ranked #216 of 919 in IL (top 24%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 157 active listings in the ZIP; 58 units permitted in Jo Daviess County in 2024 (0 in 5+ unit buildings).
• Jo Daviess County population projected at -25% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 6.4% vs local median 3.3% in The Galena Territory — 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.

Questions for listing agent

• It's been on market 274 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 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.
• 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.