1606 Prospect Hill Rd

Montross, VA 22520

$270,000F

3 bd · 2.0 ba · 1,800 sqft · Built 1998 · SingleFamily · Active · 135 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,817/mo
• Mortgage (P&I): −$1,416
• Tax + insurance: −$246
• HOA: −$0
• Vac / Maint / Mgmt: −$382
• Net cashflow: $-227/mo
• Annual: $-2,718/yr
• Cap rate: 5.29%
• Cash-on-cash: -3.60%
• DSCR: 0.84
• 1% rule: 0.67%
• Cash to close: $75,600

Investor read

• This is a 3-bed/2.0-bath single-family listed at $270k.
• At list price, monthly cash flow is $-227 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $230k (14.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $182k (32.7% below list).
• It's been on market 135 days — a 12% lower offer ($238k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $182k (32.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#353 in VA) — a middle-class / working-renter tenant base. Strengths: schools A-, housing A-, cost of living B+; Watch: employment D+, amenities F, commute F.
• Westmoreland County Public School District (rural): math 34% / reading 59% proficiency, ranked #105 of 131 in VA (top 80%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 64% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 186 active listings in the ZIP; 220 units permitted in Westmoreland County in 2024 (0 in 5+ unit buildings).
• Westmoreland County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 4 sale attempts since 7y 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 $187k; 44% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wind risk, 53% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.3% vs local median 3.2% in Montross — 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 do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 135 days. Have you received any prior offers? Is the seller open to a 33% concession, seller financing, or rate buy-down credit?
• 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.