1359 Purchase St

New Bedford, MA 02740

$399,900C-

2 bd · 2.0 ba · 2,128 sqft · Built 1870 · MultiFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,771/mo
• Mortgage (P&I): −$2,097
• Tax + insurance: −$395
• HOA: −$0
• Vac / Maint / Mgmt: −$792
• Net cashflow: $487/mo
• Annual: $5,845/yr
• Cap rate: 7.75%
• Cash-on-cash: 5.22%
• DSCR: 1.23
• 1% rule: 0.94%
• Cash to close: $111,972

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $400k.
• At list price, monthly cash flow is $487 ($6k/yr) — positive. Per door: $244/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 $377k (5.7% below list).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $377k (5.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#155 in MA) — a middle-class / working-renter tenant base. Strengths: health & safety A+, housing B+; Watch: cost of living C-, schools D, employment D.
• New Bedford (suburban): math 17% / reading 28% proficiency, ranked #287 of 302 in MA (top 95%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 65% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1870 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+10.8%/yr); 60 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 60% of comp listings sitting > 30 days — soft ceiling on asking rent; 760 units permitted in Bristol County in 2024 (142 in 5+ unit buildings).
• Bristol County population projected to shrink 3% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 26y 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 $65k; list at $400k implies a 515% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $112k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% 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 7.8% vs local median 3.8% in New Bedford — 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 $3,771/mo this rent would consume 82% of the median local household income ($55k/yr) (locally 2883% 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 1870 — 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?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.