6516 Lyman Ave

Hammond, IN 46324

$139,900C-

3 bd · 1.0 ba · 1,004 sqft · Built 1907 · SingleFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,557/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$172
• HOA: −$0
• Vac / Maint / Mgmt: −$327
• Net cashflow: $325/mo
• Annual: $3,895/yr
• Cap rate: 9.08%
• Cash-on-cash: 9.94%
• DSCR: 1.44
• 1% rule: 1.11%
• Cash to close: $39,172

Investor read

• This is a 3-bed/1.0-bath single-family listed at $140k.
• At list price, monthly cash flow is $325 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $140k).
• 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 $967 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#143 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, commute A; Watch: health & safety D+, employment D, schools F.
• School City Of Hammond (suburban): math 8% / reading 18% proficiency, ranked #289 of 301 in IN (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 74% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1907 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.5%/yr); 63 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 1,642 units permitted in Lake County in 2024 (14 in 5+ unit buildings).
• Lake County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 25y 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.
• At projected returns (-3.0% appreciation + 5.5% rent growth), your $39k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 9.1% vs local median 5.9% in Hammond — 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 1907 — 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?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.