1822 E State St

Rockford, IL 61104

$135,000D+

2 bd · 1.5 ba · 1,856 sqft · Built 1950 · SingleFamily · Pending · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,254/mo
• Mortgage (P&I): −$708
• Tax + insurance: −$225
• HOA: −$0
• Vac / Maint / Mgmt: −$263
• Net cashflow: $58/mo
• Annual: $693/yr
• Cap rate: 6.81%
• Cash-on-cash: 1.83%
• DSCR: 1.08
• 1% rule: 0.93%
• Cash to close: $37,800

Investor read

• This is a 2-bed/1.5-bath single-family listed at $135k. Condition is rated fair.
• At list price, monthly cash flow is $58 ($693/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $125k (7.1% below list).
• It's been on market 16 days — a 2% lower offer ($133k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $125k (7.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $933 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#876 in IL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime F, amenities F, commute F.
• Rockford SD 205 (urban): math 12% / reading 16% proficiency, ranked #533 of 620 in IL (top 86%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 73% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: C Henry Bloom Elem School (math 12% / reading 8%, grade F, #1,517 of 2,056 statewide, top 78%, 410 students, 0% FRL); Abraham Lincoln Middle School (math 3% / reading 7%, grade F, #636 of 665 statewide, top 98%, 699 students, 0% FRL); Rockford East High School (math 7% / reading 13%, grade F, #528 of 693 statewide, top 82%, 1,718 students, 0% FRL) — zoned schools average 0% FRL vs 73% district-wide (73 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.7%/yr); 67 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 285 units permitted in Winnebago County in 2024 (0 in 5+ unit buildings).
• Winnebago County population projected at -20% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts 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.
• This rent runs 45% of the median local income ($34k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 1950 — 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is F 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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.

Repairs flagged (vision-AI assessment)

• Major: exterior paint — Peeling paint on exterior
• Major: landscaping — Overgrown landscaping