628 W 3rd St

Madison, IN 47250

$98,500B-

2 bd · 1.5 ba · 1,239 sqft · Built 1900 · SingleFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,264/mo
• Mortgage (P&I): −$517
• Tax + insurance: −$159
• HOA: −$0
• Vac / Maint / Mgmt: −$265
• Net cashflow: $323/mo
• Annual: $3,878/yr
• Cap rate: 10.23%
• Cash-on-cash: 14.06%
• DSCR: 1.63
• 1% rule: 1.28%
• Cash to close: $27,580

Investor read

• This is a 2-bed/1.5-bath single-family listed at $98k.
• At list price, monthly cash flow is $323 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $98k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $681 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#306 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment D, health & safety D, amenities F.
• Madison Consolidated Schools (town): math 40% / reading 47% proficiency, ranked #114 of 301 in IN (top 38%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Lydia Middleton Elementary School (math 57% / reading 52%, grade C, #197 of 994 statewide, top 22%, 335 students, 46% FRL); Madison Consolidated Jr High Sch (math 39% / reading 47%, grade D-, #92 of 330 statewide, top 29%, 743 students, 53% FRL); Madison Consolidated High School (math 27% / reading 62%, grade F, #169 of 369 statewide, top 51%, 847 students, 46% FRL) — zoned schools at 48% FRL track the district average.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 133 active listings in the ZIP; 94 units permitted in Jefferson County in 2024 (0 in 5+ unit buildings).
• Jefferson County population projected to shrink 4% 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.
• Current owner paid $65k; list at $98k implies a 52% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $28k cash investment doubles in ~9 years — after that, you're playing with house money.
• 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.
• Cap rate 10.2% vs local median 2.9% in Madison — 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

• Built in 1900 — 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.
• 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.