1405 Key Pkwy Unit 201A

Frederick, MD 21702

$179,900D

2 bd · 1.0 ba · 1,280 sqft · Built 1982 · Condo · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,166/mo
• Mortgage (P&I): −$943
• Tax + insurance: −$270
• HOA: −$600
• Vac / Maint / Mgmt: −$455
• Net cashflow: $-103/mo
• Annual: $-1,232/yr
• Cap rate: 5.61%
• Cash-on-cash: -2.44%
• DSCR: 0.89
• 1% rule: 1.20%
• Cash to close: $50,372

Investor read

• This is a 2-bed/1.0-bath condo listed at $180k.
• At list price, monthly cash flow is $-103 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $162k (10.1% below list).
• Meets the 1% rule at list price ($2k rent vs $180k).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $162k (10.1% below list) — sets the bar for cash-flow.
• 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 77/100 on livability (#80 in MD, #3,041 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A+; Watch: amenities C-, crime D+, cost of living D+.
• Frederick County Public Schools (other): math 27% / reading 43% proficiency, ranked #4 of 24 in MD (top 17%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Waverley Elementary (math 7% / reading 9%, grade F, #674 of 860 statewide, top 79%, 844 students, 84% FRL); Monocacy Middle (math 7% / reading 27%, grade F, #170 of 225 statewide, top 77%, 926 students, 60% FRL); Gov. Thomas Johnson High (math 52% / reading 62%, grade C, #80 of 222 statewide, top 37%, 1,962 students, 52% FRL) — zoned schools average 65% FRL vs 20% district-wide (45 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: HOA is 28% of rent.
• Market conditions: Rents rising (+2.0%/yr); 275 active listings in the ZIP; 29 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 1,562 units permitted in Frederick County in 2024 (374 in 5+ unit buildings).
• Frederick County population projected at +15% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 8 sale attempts since 8y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $95k; list at $180k implies a 89% gain — meaningful room to come down on a strong offer.
• Cap rate 5.6% vs local median 3.3% in Frederick — 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.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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?
• 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.