116 Front Ave

Salem, VA 24153

$150,000B

3 bd · 1.0 ba · 1,612 sqft · Built 1930 · SingleFamily · Active · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,981/mo
• Mortgage (P&I): −$787
• Tax + insurance: −$192
• HOA: −$0
• Vac / Maint / Mgmt: −$416
• Net cashflow: $587/mo
• Annual: $7,041/yr
• Cap rate: 10.99%
• Cash-on-cash: 16.76%
• DSCR: 1.75
• 1% rule: 1.32%
• Cash to close: $42,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $150k.
• At list price, monthly cash flow is $587 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $150k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#104 in VA, #3,257 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, cost of living A; Watch: amenities F, commute F.
• Salem City Public School District (suburban): math 61% / reading 74% proficiency, ranked #35 of 131 in VA (top 27%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: South Salem Elementary (math 72% / reading 77%, grade A, #220 of 1,108 statewide, top 22%, 388 students, 42% FRL); Andrew Lewis Middle (math 57% / reading 72%, grade A-, #123 of 342 statewide, top 37%, 895 students, 44% FRL); Salem High (math 64% / reading 91%, grade A-, #83 of 319 statewide, top 28%, 1,227 students, 39% FRL).
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.0%/yr); 271 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 268 units permitted in Salem city in 2024 (248 in 5+ unit buildings).
• Salem County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 24y 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 $78k; list at $150k implies a 93% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 6.0% rent growth), your $42k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.0% vs local median 2.9% in Salem — 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.
• This rent runs 32% of the median local income ($74k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1930 — 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 A-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?
• 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.