364-366 Washington St

Norwich, CT 06360

$418,000D

6 bd · 3.6 ba · 3,308 sqft · Built 1860 · MultiFamily · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,937/mo
• Mortgage (P&I): −$2,192
• Tax + insurance: −$752
• HOA: −$0
• Vac / Maint / Mgmt: −$827
• Net cashflow: $166/mo
• Annual: $1,992/yr
• Cap rate: 6.93%
• Cash-on-cash: 2.27%
• DSCR: 1.10
• 1% rule: 0.94%
• Cash to close: $117,040

Investor read

• This is a 2 × 3-bed/1.8-bath units multifamily listed at $418k. Condition is rated fair.
• At list price, monthly cash flow is $166 ($2k/yr) — positive. Per door: $83/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $394k (5.8% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $394k (5.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#18 in CT, #1,391 nationally) — a professional / high-income tenant draw. Strengths: housing A+, health & safety A+, commute A-.
• Norwich School District (urban): math 19% / reading 29% proficiency, ranked #139 of 153 in CT (top 91%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Moriarty Magnet School (math 26% / reading 31%, grade F, #396 of 553 statewide, top 72%, 368 students, 62% FRL); Kelly Steam Magnet Middle School (math 15% / reading 32%, grade F, #156 of 175 statewide, top 90%, 556 students, 72% FRL).
• Watch-outs: flood insurance adds $56/mo; built in 1860 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.6%/yr); 243 active listings in the ZIP; 487 units permitted in Southeastern Connecticut Planning Region in 2024 (244 in 5+ unit buildings).
• Climate carrying-cost: severe flood risk; major wind risk, 62% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.9% vs local median 4.1% in Norwich — 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 $3,937/mo this rent would consume 72% of the median local household income ($66k/yr) (locally 1643% 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?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1860 — 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.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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?

Repairs flagged (vision-AI assessment)

• Moderate: Exterior siding — Weathered and in need of replacement
• Moderate: Roof — Aged and likely in need of repair or replacement