405 Villanova Ave

Chesapeake, VA 23324

$275,000D+

3 bd · 2.0 ba · 1,441 sqft · Built 1969 · SingleFamily · Under Contract · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,308/mo
• Mortgage (P&I): −$1,442
• Tax + insurance: −$458
• HOA: −$0
• Vac / Maint / Mgmt: −$485
• Net cashflow: $-77/mo
• Annual: $-929/yr
• Cap rate: 5.95%
• Cash-on-cash: -1.21%
• DSCR: 0.95
• 1% rule: 0.84%
• Cash to close: $77,000

Investor read

• This is a 3-bed/2.0-bath single-family listed at $275k.
• At list price, monthly cash flow is $-77 ($-929/yr) — negative.
• To cash-flow at today's rent, offer at most $264k (4.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $231k (16.1% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $231k (16.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#236 in VA) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+; Watch: crime C-, cost of living C-, amenities F.
• Chesapeake City Public School District (suburban): math 58% / reading 74% proficiency, ranked #31 of 131 in VA (top 24%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Portlock Primary (541 students, 93% FRL); Oscar F. Smith High (math 63% / reading 75%, grade B, #170 of 319 statewide, top 55%, 2,291 students, 70% FRL) — zoned schools average 82% FRL vs 28% district-wide (54 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 118 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 597 units permitted in Chesapeake city in 2024 (0 in 5+ unit buildings).
• Chesapeake County population projected at +21% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $26k; list at $275k implies a 966% gain — meaningful room to come down on a strong offer.
• 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 6.0% vs local median 3.8% in Chesapeake — 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 $2,308/mo this rent would consume 49% of the median local household income ($57k/yr) (locally 1301% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 1969 — 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?
• 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.
• 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.