18847 May Ave

Homewood, IL 60430

$389,000C

4 bd · 2.5 ba · 2,500 sqft · Built 1964 · SingleFamily · Active · 34 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,000/mo
• Mortgage (P&I): −$2,040
• Tax + insurance: −$955
• HOA: −$0
• Vac / Maint / Mgmt: −$1,050
• Net cashflow: $955/mo
• Annual: $11,457/yr
• Cap rate: 9.24%
• Cash-on-cash: 10.52%
• DSCR: 1.47
• 1% rule: 1.29%
• Cash to close: $108,920

Investor read

• This is a 4-bed/2.5-bath single-family listed at $389k.
• At list price, monthly cash flow is $955 ($11k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $389k).
• It's been on market 34 days — a 3% lower offer ($377k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $377k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#81 in IL, #1,314 nationally) — a professional / high-income tenant draw. Strengths: commute A+, employment A+, cost of living A+; Watch: schools D+, amenities F.
• Homewood Flossmoor Chsd 233 (suburban): math 21% / reading 27% proficiency, ranked #272 of 620 in IL (top 44%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Market conditions: 101 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 6,272 units permitted in Cook County in 2024 (4,658 in 5+ unit buildings).
• Current owner paid $290k; 34% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 9.2% vs local median 6.1% in Homewood — 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 34 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1964 — 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.