63 W Liberty St

Waterbury, CT 06706

$579,000D+

4 bd · 4.0 ba · 3,250 sqft · Built 1890 · MultiFamily · Under Contract · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,176/mo
• Mortgage (P&I): −$3,036
• Tax + insurance: −$742
• HOA: −$0
• Vac / Maint / Mgmt: −$1,087
• Net cashflow: $310/mo
• Annual: $3,725/yr
• Cap rate: 6.94%
• Cash-on-cash: 2.30%
• DSCR: 1.10
• 1% rule: 0.89%
• Cash to close: $162,120

Investor read

• This is a 4 × 1-bed/?-bath units multifamily listed at $579k.
• At list price, monthly cash flow is $310 ($4k/yr) — positive. Per door: $78/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 $518k (10.6% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $518k (10.6% below list) — sets the bar for 1% rule.
• In year one you build about $12k of equity ($4k loan paydown + $8k appreciation (1.4% local appreciation)).
• Location reads 79/100 on livability (#32 in CT, #2,205 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: schools D+, crime D, employment D.
• Waterbury School District (suburban): math 12% / reading 23% proficiency, ranked #148 of 153 in CT (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 73% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 42 active listings in the ZIP; 23 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 48% of comp listings sitting > 30 days — soft ceiling on asking rent; 502 units permitted in Naugatuck Valley Planning Region in 2024 (171 in 5+ unit buildings).
• At projected returns (1.4% appreciation + 3.0% rent growth), your $162k cash investment doubles in ~8 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$43k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate flood risk; major wind risk, 27% 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 3.6% in Waterbury — 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 $5,176/mo this rent would consume 119% of the median local household income ($52k/yr) (locally 801% 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 1890 — 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 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?
• 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?
• 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.