347 Marganza S

Maryland City, MD 20724

$399,000C-

5 bd · 2.5 ba · 1,862 sqft · Built 1963 · SingleFamily · Pending · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,415/mo
• Mortgage (P&I): −$2,092
• Tax + insurance: −$553
• HOA: −$0
• Vac / Maint / Mgmt: −$717
• Net cashflow: $53/mo
• Annual: $632/yr
• Cap rate: 6.45%
• Cash-on-cash: 0.57%
• DSCR: 1.03
• 1% rule: 0.86%
• Cash to close: $111,720

Investor read

• This is a 5-bed/2.5-bath single-family listed at $399k.
• At list price, monthly cash flow is $53 ($632/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $342k (14.4% below list).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $342k (14.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#108 in MD, #4,306 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A+; Watch: crime C-, schools D-, commute F.
• Anne Arundel County Public Schools (suburban): math 20% / reading 37% proficiency, ranked #10 of 24 in MD (top 42%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Market conditions: Rents rising fast (+5.8%/yr); 129 active listings in the ZIP; high-income renter base; 1,303 units permitted in Anne Arundel County in 2024 (299 in 5+ unit buildings).
• Anne Arundel County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 29y 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 $175k; list at $399k implies a 128% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.5% vs local median 3.4% in Maryland City — 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 35% of the median local income ($118k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1963 — 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?
• 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.