5337 W 87th St

Oak Lawn, IL 60453

$519,000B

6 bd · 2.0 ba · — sqft · Built 1968 · MultiFamily · Pending · 7 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,778/mo
• Mortgage (P&I): −$2,722
• Tax + insurance: −$865
• HOA: −$0
• Vac / Maint / Mgmt: −$1,633
• Net cashflow: $2,558/mo
• Annual: $30,695/yr
• Cap rate: 12.21%
• Cash-on-cash: 21.12%
• DSCR: 1.94
• 1% rule: 1.50%
• Cash to close: $145,320

Investor read

• This is a 6-bed/2.0-bath multifamily listed at $519k. Condition is rated fair.
• At list price, monthly cash flow is $3k ($31k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $519k).
• Only 7 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#102 in IL, #1,614 nationally) — a professional / high-income tenant draw. Strengths: commute A+, housing A+, employment A-.
• Oak Lawn Chsd 229 (suburban): math 22% / reading 21% proficiency, ranked #384 of 620 in IL (top 62%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Market conditions: Rents rising fast (+8.2%/yr); 188 active listings in the ZIP; solid renter incomes; 6,272 units permitted in Cook County in 2024 (4,658 in 5+ unit buildings).
• 2 sale attempts since 3y 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 $405k; 28% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $145k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 12.2% vs local median 4.4% in Oak Lawn — 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 $7,778/mo this rent would consume 111% of the median local household income ($84k/yr) (locally 827% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1968 — 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.
• 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.

Repairs flagged (vision-AI assessment)

• Major: paint — paint appears worn and needs touch-up
• Major: landscaping — some overgrown shrubs need trimming