622 Middle Ave

Elyria, OH 44035

$175,000C+

5 bd · 2.0 ba · 2,720 sqft · Built 1925 · MultiFamily · Pending · 52 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,679/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$235
• HOA: −$0
• Vac / Maint / Mgmt: −$563
• Net cashflow: $964/mo
• Annual: $11,565/yr
• Cap rate: 12.90%
• Cash-on-cash: 23.60%
• DSCR: 2.05
• 1% rule: 1.53%
• Cash to close: $49,000

Investor read

• This is a 2×2bd/1ba + 1×1bd/1ba units multifamily listed at $175k.
• At list price, monthly cash flow is $964 ($12k/yr) — positive. Per door: $321/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $175k).
• It's been on market 52 days — a 3% lower offer ($170k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $170k (3.0% below list) — sets the bar for market timing.
• 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 75/100 on livability (#243 in OH, #3,869 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A; Watch: schools C-, employment D, commute F.
• Elyria City Schools (urban): math 21% / reading 37% proficiency, ranked #586 of 656 in OH (top 89%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.7%/yr); 356 active listings in the ZIP; 1,098 units permitted in Lorain County in 2024 (20 in 5+ unit buildings).
• 8 sale attempts since 32y 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 $150k; 17% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 6.7% rent growth), your $49k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 12.9% vs local median 3.8% in Elyria — 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 $2,679/mo this rent would consume 57% of the median local household income ($56k/yr) (locally 2229% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 52 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• 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 1925 — 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.