111 S Porter St

Michigan City, IN 46360

$169,000B

3 bd · 3.0 ba · 3,670 sqft · Built 1900 · MultiFamily · Active · 29 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,396/mo
• Mortgage (P&I): −$886
• Tax + insurance: −$181
• HOA: −$0
• Vac / Maint / Mgmt: −$713
• Net cashflow: $1,616/mo
• Annual: $19,392/yr
• Cap rate: 17.77%
• Cash-on-cash: 40.98%
• DSCR: 2.82
• 1% rule: 2.01%
• Cash to close: $47,320

Investor read

• This is a 3 × 2-bed/0.7-bath units multifamily listed at $169k.
• At list price, monthly cash flow is $2k ($19k/yr) — positive. Per door: $539/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $169k).
• It's been on market 29 days — a 2% lower offer ($166k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $166k (1.5% 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 81/100 on livability (#15 in IN, #1,317 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: employment D, amenities D-.
• Michigan City Area Schools (urban): math 23% / reading 28% proficiency, ranked #262 of 301 in IN (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Lake Hills Elementary School (math 16% / reading 19%, grade F, #835 of 994 statewide, top 84%, 383 students, 87% FRL); Martin T Krueger Middle School (math 14% / reading 17%, grade F, #293 of 330 statewide, top 90%, 333 students, 84% FRL); Michigan City High School (math 17% / reading 37%, grade F, #315 of 369 statewide, top 86%, 1,555 students, 71% FRL).
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.7%/yr); 377 active listings in the ZIP; 216 units permitted in LaPorte County in 2024 (75 in 5+ unit buildings).
• LaPorte County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 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 $56k; list at $169k implies a 202% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $47k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 17.8% vs local median 3.0% in Michigan City — 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

• 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 1900 — 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 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.