422 Buchanan Ct

Vernon Hills, IL 60061

$280,000F

2 bd · 1.0 ba · 1,050 sqft · Built 1977 · Condo · Active · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,359/mo
• Mortgage (P&I): −$1,468
• Tax + insurance: −$553
• HOA: −$248
• Vac / Maint / Mgmt: −$495
• Net cashflow: $-406/mo
• Annual: $-4,873/yr
• Cap rate: 4.55%
• Cash-on-cash: -6.22%
• DSCR: 0.72
• 1% rule: 0.84%
• Cash to close: $78,400

Investor read

• This is a 2-bed/1.0-bath condo listed at $280k.
• At list price, monthly cash flow is $-406 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $252k (10.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $236k (15.8% below list).
• It's been on market 16 days — a 2% lower offer ($276k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $236k (15.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#97 in IL, #1,577 nationally) — a professional / high-income tenant draw. Strengths: crime A+, amenities A+, employment A+; Watch: commute F, cost of living F.
• Chsd 128 (suburban): math 60% / reading 63% proficiency, ranked #22 of 620 in IL (top 4%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising (+3.3%/yr); 76 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 948 units permitted in Lake County in 2024 (424 in 5+ unit buildings).
• Lake County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 16y 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 $153k; list at $280k implies a 83% gain — meaningful room to come down on a strong offer.
• Cap rate 4.6% vs local median 3.1% in Vernon Hills — 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

• 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?
• Built in 1977 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.