1 McKinley St

Norwalk, CT 06853

$2,595,000D+

2 bd · 3.0 ba · 2,044 sqft · Built 2002 · Other · Under Contract · 12 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $24,975/mo
• Mortgage (P&I): −$13,608
• Tax + insurance: −$3,231
• HOA: −$0
• Vac / Maint / Mgmt: −$5,245
• Net cashflow: $2,891/mo
• Annual: $34,691/yr
• Cap rate: 7.63%
• Cash-on-cash: 4.77%
• DSCR: 1.21
• 1% rule: 0.96%
• Cash to close: $726,600

Investor read

• This is a 2-bed/3.0-bath other listed at $2.60M.
• At list price, monthly cash flow is $3k ($35k/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 $2.50M (3.8% below list).
• Only 12 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $2.50M (3.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $18k of loan paydown is wiped out by about $78k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#41 in CT, #2,966 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, health & safety A+, crime A; Watch: amenities C-, cost of living F.
• Norwalk School District (urban): math 29% / reading 44% proficiency, ranked #104 of 153 in CT (top 68%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Rowayton School (math 60% / reading 64%, grade B, #137 of 553 statewide, top 28%, 468 students, 33% FRL); Brien Mcmahon High School (math 30% / reading 58%, grade F, #97 of 194 statewide, top 50%, 1,711 students, 49% FRL) — zoned schools at 41% FRL track the district average.
• Zoned-school proficiency averages 53% at this address vs 36% district-wide (+16 pts) — the actual schools serving this property are materially stronger than the Norwalk School District average implies; a family-tenant draw the district grade alone would hide.
• Market conditions: 25 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals leasing fast (median 4d on market — plan ~1-2 weeks tenant-placement turnaround); 1,151 units permitted in Western Connecticut Planning Region in 2024 (714 in 5+ unit buildings).
• 4 sale attempts since 20y 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 $1.88M; 38% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 7.6% vs local median 3.4% in Norwalk — 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

• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.
• 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.