39 Jacoby St

Norristown, PA 19401

$175,000B+

5 bd · 2.0 ba · 2,550 sqft · Built 1900 · MultiFamily · Pending · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,847/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$452
• HOA: −$0
• Vac / Maint / Mgmt: −$808
• Net cashflow: $1,670/mo
• Annual: $20,038/yr
• Cap rate: 17.74%
• Cash-on-cash: 40.89%
• DSCR: 2.82
• 1% rule: 2.20%
• Cash to close: $49,000

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $175k.
• At list price, monthly cash flow is $2k ($20k/yr) — positive. Per door: $835/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $175k).
• Only 4 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 84/100 on livability (#100 in PA, #720 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: schools C-, crime D-.
• Norristown Area SD (suburban): math 18% / reading 31% proficiency, ranked #466 of 539 in PA (top 86%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 70% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 2.6% of price; built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.3%/yr); 164 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 1,936 units permitted in Montgomery County in 2024 (530 in 5+ unit buildings).
• Montgomery County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $50k; list at $175k implies a 250% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 1.3% rent growth), your $49k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 17.7% vs local median 4.5% in Norristown — 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.
• At $3,847/mo this rent would consume 66% of the median local household income ($70k/yr) (locally 2725% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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?
• 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.