60 Jay St

New London, CT 06320

$199,000B

4 bd · 2.0 ba · 2,506 sqft · Built 1870 · SingleFamily · Active · 103 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,626/mo
• Mortgage (P&I): −$1,044
• Tax + insurance: −$332
• HOA: −$0
• Vac / Maint / Mgmt: −$552
• Net cashflow: $700/mo
• Annual: $8,395/yr
• Cap rate: 10.51%
• Cash-on-cash: 15.07%
• DSCR: 1.67
• 1% rule: 1.32%
• Cash to close: $55,720

Investor read

• This is a 4-bed/2.0-bath single-family listed at $199k.
• At list price, monthly cash flow is $700 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $199k).
• It's been on market 103 days — a 9% lower offer ($181k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $181k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#66 in CT, #4,772 nationally) — a middle-class / working-renter tenant base. Strengths: health & safety A+, housing A-, crime B+; Watch: employment D+, amenities F, commute F.
• New London School District (urban): math 11% / reading 21% proficiency, ranked #149 of 153 in CT (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 72% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Winthrop Stem Elementary Magnet School (math 28% / reading 31%, grade F, #383 of 553 statewide, top 71%, 425 students, 77% FRL); Bennie Dover Jackson Middle School (math 0% / reading 16%, grade F, #170 of 175 statewide, top 97%, 349 students, 97% FRL); New London High School (math 2% / reading 12%, grade F, #188 of 194 statewide, top 98%, 532 students, 93% FRL) — zoned schools average 89% FRL vs 72% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1870 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 67 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 487 units permitted in Southeastern Connecticut Planning Region in 2024 (244 in 5+ unit buildings).
• 2 sale attempts since 3y ago; this cycle's ask has dropped $26k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.5% vs local median 4.5% in New London — 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 $2,626/mo this rent would consume 53% of the median local household income ($59k/yr) (locally 2014% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 103 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1870 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-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 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.