7 Hamburg St

Shelton, CT 06484

$369,000B-

5 bd · 1.5 ba · 2,035 sqft · Built 1960 · SingleFamily · Under Contract · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,131/mo
• Mortgage (P&I): −$1,935
• Tax + insurance: −$487
• HOA: −$0
• Vac / Maint / Mgmt: −$867
• Net cashflow: $841/mo
• Annual: $10,092/yr
• Cap rate: 9.03%
• Cash-on-cash: 9.77%
• DSCR: 1.43
• 1% rule: 1.12%
• Cash to close: $103,320

Investor read

• This is a 5-bed/1.5-bath single-family listed at $369k.
• At list price, monthly cash flow is $841 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $369k).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#36 in CT, #2,479 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F, cost of living F.
• Shelton School District (suburban): math 46% / reading 62% proficiency, ranked #64 of 153 in CT (top 42%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 15% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+2.5%/yr); 143 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 11d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 502 units permitted in Naugatuck Valley Planning Region in 2024 (171 in 5+ unit buildings).
• Climate carrying-cost: major flood risk; major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.0% vs local median 3.1% in Shelton — 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 $4,131/mo this rent would consume 46% of the median local household income ($108k/yr) (locally 874% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1960 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.