117 Fir

Michigan City, IN 46360

$115,000B-

2 bd · 1.0 ba · 1,440 sqft · Built 1928 · SingleFamily · Pending · 37 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,215/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$73
• HOA: −$0
• Vac / Maint / Mgmt: −$255
• Net cashflow: $283/mo
• Annual: $3,401/yr
• Cap rate: 9.25%
• Cash-on-cash: 10.56%
• DSCR: 1.47
• 1% rule: 1.06%
• Cash to close: $32,200

Investor read

• This is a 2-bed/1.0-bath single-family listed at $115k.
• At list price, monthly cash flow is $283 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $115k).
• It's been on market 37 days — a 3% lower offer ($112k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $112k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $795 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#15 in IN, #1,317 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: employment D, amenities D-.
• Michigan City Area Schools (urban): math 23% / reading 28% proficiency, ranked #262 of 301 in IN (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Lake Hills Elementary School (math 16% / reading 19%, grade F, #835 of 994 statewide, top 84%, 383 students, 87% FRL); Martin T Krueger Middle School (math 14% / reading 17%, grade F, #293 of 330 statewide, top 90%, 333 students, 84% FRL); Michigan City High School (math 17% / reading 37%, grade F, #315 of 369 statewide, top 86%, 1,555 students, 71% FRL).
• Watch-outs: built in 1928 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.7%/yr); 377 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 216 units permitted in LaPorte County in 2024 (75 in 5+ unit buildings).
• LaPorte County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 12y ago; this cycle's ask has dropped $10k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $32k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 9.3% vs local median 3.0% in Michigan City — 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 37 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1928 — 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 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.