None

Waukegan, IL 60087

$165,000D

3 bd · 1.0 ba · 864 sqft · Built 2006 · Condo · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,810/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$247
• HOA: −$280
• Vac / Maint / Mgmt: −$380
• Net cashflow: $38/mo
• Annual: $454/yr
• Cap rate: 6.57%
• Cash-on-cash: 0.98%
• DSCR: 1.04
• 1% rule: 1.10%
• Cash to close: $46,200

Investor read

• This is a 3-bed/1.0-bath condo listed at $165k.
• At list price, monthly cash flow is $38 ($454/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $165k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• 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 (#216 in IL, #4,074 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: employment C-, crime D, amenities D-.
• Waukegan CUSD 60 (suburban): math 7% / reading 10% proficiency, ranked #587 of 620 in IL (top 95%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Oakdale Elem School (math 2% / reading 17%, grade F, #1,517 of 2,056 statewide, top 78%, 405 students, 0% FRL); Miguel Juarez Middle School (math 3% / reading 11%, grade F, #627 of 665 statewide, top 95%, 672 students, 0% FRL); Waukegan High School (math 5% / reading 6%, grade F, #609 of 693 statewide, top 88%, 4,355 students, 0% FRL) — zoned schools average 0% FRL vs 66% district-wide (66 pts lower); this property's tenant base skews higher-income than the district average.
• Market conditions: 42 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 0d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 948 units permitted in Lake County in 2024 (424 in 5+ unit buildings).
• Lake County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Current owner paid $143k; 15% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.6% vs local median 4.6% in Waukegan — 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

• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 D 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.