2560 State St

Granite City, IL 62040

$115,000C+

5 bd · 2.0 ba · 728 sqft · Built 1920 · SingleFamily · Active · 138 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,449/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$253
• HOA: −$0
• Vac / Maint / Mgmt: −$304
• Net cashflow: $289/mo
• Annual: $3,468/yr
• Cap rate: 9.31%
• Cash-on-cash: 10.77%
• DSCR: 1.48
• 1% rule: 1.26%
• Cash to close: $32,200

Investor read

• This is a 5-bed/2.0-bath single-family listed at $115k.
• At list price, monthly cash flow is $289 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $115k).
• It's been on market 138 days — a 12% lower offer ($101k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $101k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $795 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#623 in IL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools F, crime F, amenities F.
• Granite City CUSD 9 (suburban): math 9% / reading 11% proficiency, ranked #570 of 620 in IL (top 92%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.7%/yr); 194 active listings in the ZIP; 336 units permitted in Madison County in 2024 (0 in 5+ unit buildings).
• Madison County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $91k; 26% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.3% vs local median 6.9% in Granite 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

• It's been on market 138 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1920 — 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.
• 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?
• 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.