36 & 38 Middle Spring Ave

Shippensburg, PA 17257

$210,000C+

5 bd · 2.0 ba · 2,034 sqft · Built 1920 · MultiFamily · Active · 30 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,651/mo
• Mortgage (P&I): −$1,101
• Tax + insurance: −$751
• HOA: −$0
• Vac / Maint / Mgmt: −$557
• Net cashflow: $242/mo
• Annual: $2,908/yr
• Cap rate: 10.12%
• Cash-on-cash: 13.65%
• DSCR: 1.61
• 1% rule: 1.26%
• Cash to close: $58,800

Investor read

• This is a 2 × 2-bed/1-bath units multifamily listed at $210k.
• At list price, monthly cash flow is $242 ($3k/yr) — positive. Per door: $121/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $210k).
• It's been on market 30 days — a 2% lower offer ($207k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $207k (1.5% 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 $6k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#741 in PA) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, health & safety A; Watch: employment D+, amenities F, commute F.
• Shippensburg Area SD (town): math 31% / reading 52% proficiency, ranked #335 of 539 in PA (top 62%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $427/mo; built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 161 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 15d on market — plan ~3-4 weeks tenant-placement turnaround); 1,052 units permitted in Cumberland County in 2024 (310 in 5+ unit buildings).
• Cumberland County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 7 sale attempts since 3y 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 $173k; 21% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.1% vs local median 3.5% in Shippensburg — 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 45% of the median local income ($71k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.