225 W Washington St

Elkhart, IN 46516

$162,900F

2 bd · 1.0 ba · 1,512 sqft · Built 1900 · SingleFamily · Pending · 69 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,239/mo
• Mortgage (P&I): −$854
• Tax + insurance: −$253
• HOA: −$0
• Vac / Maint / Mgmt: −$260
• Net cashflow: $-129/mo
• Annual: $-1,551/yr
• Cap rate: 5.75%
• Cash-on-cash: -1.94%
• DSCR: 0.91
• 1% rule: 0.76%
• Cash to close: $45,612

Investor read

• This is a 2-bed/1.0-bath single-family listed at $163k.
• At list price, monthly cash flow is $-129 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $140k (14.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $124k (24.0% below list).
• It's been on market 69 days — a 6% lower offer ($153k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $124k (24.0% below list) — sets the bar for 1% rule.
• 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 68/100 on livability (#224 in IN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities C-, crime F, commute F.
• Elkhart Community Schools (urban): math 18% / reading 25% proficiency, ranked #271 of 301 in IN (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Beardsley Elementary School (math 9% / reading 8%, grade F, #939 of 994 statewide, top 95%, 457 students, 73% FRL); North Side Middle School (math 15% / reading 31%, grade F, #263 of 330 statewide, top 80%, 627 students, 72% FRL).
• Watch-outs: flood insurance adds $56/mo; built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 150 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 484 units permitted in Elkhart County in 2024 (136 in 5+ unit buildings).
• Elkhart County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 2y 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 $32k; list at $163k implies a 417% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 4.0% in Elkhart — 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?
• It's been on market 69 days. Have you received any prior offers? Is the seller open to a 24% concession, seller financing, or rate buy-down credit?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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?