622 Schwarz Rd

Lawrence, KS 66049

$890,000B

306 bd · 2.0 ba · 10,143 sqft · Built 1963 · MultiFamily · Pending · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $19,405/mo
• Mortgage (P&I): −$4,667
• Tax + insurance: −$1,361
• HOA: −$0
• Vac / Maint / Mgmt: −$4,075
• Net cashflow: $9,301/mo
• Annual: $111,615/yr
• Cap rate: 18.83%
• Cash-on-cash: 44.79%
• DSCR: 2.99
• 1% rule: 2.18%
• Cash to close: $249,200

Investor read

• This is a 18 × 1-bed/1-bath units multifamily listed at $890k.
• At list price, monthly cash flow is $9k ($112k/yr) — positive. Per door: $517/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($19k rent vs $890k).
• It's been on market 16 days — a 2% lower offer ($877k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $877k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $27k of value loss. Plan a longer hold.
• Location reads 88/100 on livability (#1 in KS, #237 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime D-.
• Lawrence (urban): math 31% / reading 44% proficiency, ranked #46 of 169 in KS (top 27%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising fast (+4.6%/yr); 136 active listings in the ZIP; solid renter incomes; 246 units permitted in Douglas County in 2024 (38 in 5+ unit buildings).
• Douglas County population projected at +39% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (-3.0% appreciation + 4.6% rent growth), your $249k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 18.8% vs local median 2.7% in Lawrence — 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 $19,405/mo this rent would consume 258% of the median local household income ($90k/yr) (locally 1866% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1963 — 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.
• Crime grade is D 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 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.