2010 Lincoln St

Two Rivers, WI 54241

$175,000C

5 bd · 3.0 ba · 2,040 sqft · Built 1910 · MultiFamily · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,476/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$320
• HOA: −$0
• Vac / Maint / Mgmt: −$520
• Net cashflow: $718/mo
• Annual: $8,621/yr
• Cap rate: 11.22%
• Cash-on-cash: 17.59%
• DSCR: 1.78
• 1% rule: 1.41%
• Cash to close: $49,000

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $175k.
• At list price, monthly cash flow is $718 ($9k/yr) — positive. Per door: $359/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $175k).
• It's been on market 23 days — a 2% lower offer ($172k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $172k (1.5% 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 $5k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#280 in WI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: schools D-, amenities F, commute F.
• Two Rivers Public School District (town): math 20% / reading 28% proficiency, ranked #318 of 342 in WI (top 93%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 68 active listings in the ZIP; 100 units permitted in Manitowoc County in 2024 (0 in 5+ unit buildings).
• Manitowoc County population projected at -21% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 6 sale attempts since 13y 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 $74k; list at $175k implies a 136% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $49k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 11.2% vs local median 4.0% in Two Rivers — 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 $2,476/mo this rent would consume 49% of the median local household income ($61k/yr) (locally 199% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• 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 1910 — 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.
• How much new apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.