56400 Francis Ave

Mishawaka, IN 46545

$149,000B

3 bd · 1.0 ba · 1,280 sqft · Built 1950 · SingleFamily · Pending · 70 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,676/mo
• Mortgage (P&I): −$781
• Tax + insurance: −$123
• HOA: −$0
• Vac / Maint / Mgmt: −$352
• Net cashflow: $420/mo
• Annual: $5,037/yr
• Cap rate: 9.67%
• Cash-on-cash: 12.07%
• DSCR: 1.54
• 1% rule: 1.12%
• Cash to close: $41,720

Investor read

• This is a 3-bed/1.0-bath single-family listed at $149k.
• At list price, monthly cash flow is $420 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $149k).
• It's been on market 70 days — a 6% lower offer ($140k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $140k (6.0% 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 $4k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#53 in IN, #3,586 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety B; Watch: amenities F, employment F.
• Penn-Harris-Madison School Corporation (suburban): math 54% / reading 64% proficiency, ranked #19 of 301 in IN (top 6%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Elsie Rogers Elementary School (math 52% / reading 47%, grade D, #279 of 994 statewide, top 30%, 386 students, 42% FRL); Schmucker Middle School (math 40% / reading 56%, grade C-, #60 of 330 statewide, top 18%, 1,004 students, 36% FRL); Penn High School (math 53% / reading 83%, grade B, #22 of 369 statewide, top 6%, 3,624 students, 27% FRL).
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.2%/yr); 74 active listings in the ZIP; 754 units permitted in St. Joseph County in 2024 (460 in 5+ unit buildings).
• 3 sale attempts since 8y ago; this cycle's ask has dropped $16k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $115k; 30% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 5.2% rent growth), your $42k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 9.7% vs local median 5.3% in Mishawaka — 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.
• This rent runs 35% of the median local income ($57k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 70 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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 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.