278 Burgundy Unit F

Delray Beach, FL 33484

$55,000B

2 bd · 2.0 ba · 1,010 sqft · Built 1979 · Condo · Active · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,059/mo
• Mortgage (P&I): −$288
• Tax + insurance: −$142
• HOA: −$777
• Vac / Maint / Mgmt: −$432
• Net cashflow: $419/mo
• Annual: $5,030/yr
• Cap rate: 15.44%
• Cash-on-cash: 32.66%
• DSCR: 2.45
• 1% rule: 3.74%
• Cash to close: $15,400

Investor read

• This is a 2-bed/2.0-bath condo listed at $55k.
• At list price, monthly cash flow is $419 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $55k).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $380 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#202 in FL, #3,160 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, commute A-; Watch: cost of living C-, crime D-, amenities F.
• Palm Beach (suburban): math 46% / reading 53% proficiency, ranked #34 of 73 in FL (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: property tax is 2.6% of price; HOA is 38% of rent.
• Market conditions: Rents rising fast (+4.3%/yr); 546 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 3,974 units permitted in Palm Beach County in 2024 (1,012 in 5+ unit buildings).
• Palm Beach County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $34k; list at $55k implies a 62% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 4.3% rent growth), your $15k cash investment doubles in ~4 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→26/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 15.4% vs local median 4.3% in Delray Beach — 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 40% of the median local income ($62k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1979 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.