142 S Ervin Ave

Newton, NC 28658

$174,999F

2 bd · 1.0 ba · 744 sqft · Built 1955 · SingleFamily · Coming Soon · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,150/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$292
• HOA: −$0
• Vac / Maint / Mgmt: −$242
• Net cashflow: $-301/mo
• Annual: $-3,611/yr
• Cap rate: 4.23%
• Cash-on-cash: -7.37%
• DSCR: 0.67
• 1% rule: 0.66%
• Cash to close: $49,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $175k.
• At list price, monthly cash flow is $-301 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $131k (24.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $115k (34.3% below list).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $115k (34.3% below list) — sets the bar for 1% rule.
• 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 73/100 on livability (#77 in NC) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment C-, crime D+, schools D-.
• Newton Conover City Schools (suburban): math 49% / reading 47% proficiency, ranked #74 of 178 in NC (top 42%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1955 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 228 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 2,016 units permitted in Catawba County in 2024 (255 in 5+ unit buildings).
• Catawba County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 5 sale attempts since 3y ago; this cycle's ask is 12400% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $55k; list at $175k implies a 218% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.2% vs local median 2.9% in Newton — 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?
• Built in 1955 — 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.
• 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.