236 W 9th St

Newport, KY 41071

$525,000B-

None bd · None ba · 3,198 sqft · Built 1895 · MultiFamily · Pending · 8 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,052/mo
• Mortgage (P&I): −$2,753
• Tax + insurance: −$370
• HOA: −$0
• Vac / Maint / Mgmt: −$1,271
• Net cashflow: $1,658/mo
• Annual: $19,893/yr
• Cap rate: 10.08%
• Cash-on-cash: 13.53%
• DSCR: 1.60
• 1% rule: 1.15%
• Cash to close: $147,000

Investor read

• This is a 4 × 1-bed/1-bath units multifamily listed at $525k. Condition is rated good.
• At list price, monthly cash flow is $2k ($20k/yr) — positive. Per door: $414/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $525k).
• Only 8 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#58 in KY, #1,070 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime F, employment D-.
• Newport Independent (suburban): math 14% / reading 26% proficiency, ranked #160 of 165 in KY (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Newport High School (math 16% / reading 28%, grade F, #202 of 254 statewide, top 82%, 579 students, 84% FRL).
• Watch-outs: built in 1895 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.6%/yr); 236 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 247 units permitted in Campbell County in 2024 (77 in 5+ unit buildings).
• Current owner paid $425k; 24% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 4.6% rent growth), your $147k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 10.1% vs local median 4.9% in Newport — 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 $6,052/mo this rent would consume 121% of the median local household income ($60k/yr) (locally 1136% 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 1895 — 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 F 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.
• 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.