1540 N Sea Rd

North Sea, NY 11968

$925,000A-

4 bd · 2.0 ba · 1,144 sqft · Built 1995 · SingleFamily · Pending · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $21,707/mo
• Mortgage (P&I): −$4,851
• Tax + insurance: −$583
• HOA: −$0
• Vac / Maint / Mgmt: −$4,559
• Net cashflow: $11,715/mo
• Annual: $140,575/yr
• Cap rate: 21.49%
• Cash-on-cash: 54.28%
• DSCR: 3.41
• 1% rule: 2.35%
• Cash to close: $259,000

Investor read

• This is a 4-bed/2.0-bath single-family listed at $925k.
• At list price, monthly cash flow is $12k ($141k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($22k rent vs $925k).
• It's been on market 17 days — a 2% lower offer ($911k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $911k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $28k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#1,063 in NY) — a working-class tenant base; expect higher turnover. Strengths: crime A+, employment A+; Watch: housing C-, schools D+, amenities F.
• Southampton Union Free School District (suburban): math 53% / reading 51% proficiency, ranked #293 of 590 in NY (top 50%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+14.6%/yr); 96 active listings in the ZIP; 1 comparable units currently listed for rent nearby; high-income renter base; 1,366 units permitted in Suffolk County in 2024 (216 in 5+ unit buildings).
• Suffolk County population projected to shrink 5% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $259k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y — expect insurance premiums to compound above CPI over the hold.
• Cap rate 21.5% vs local median 6.5% in North Sea — 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 $21,707/mo this rent would consume 167% of the median local household income ($156k/yr) (locally 274% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• 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?
• 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.