5601 Highway A1a Unit S100

Indian River Shores, FL 32963

$435,000C+

3 bd · 3.0 ba · 2,400 sqft · Built 1977 · Townhouse · Active · 127 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,699/mo
• Mortgage (P&I): −$2,281
• Tax + insurance: −$791
• HOA: −$2,058
• Vac / Maint / Mgmt: −$1,407
• Net cashflow: $161/mo
• Annual: $1,937/yr
• Cap rate: 6.92%
• Cash-on-cash: 2.25%
• DSCR: 1.10
• 1% rule: 1.54%
• Cash to close: $121,800

Investor read

• This is a 3-bed/3.0-bath townhouse listed at $435k.
• At list price, monthly cash flow is $161 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $435k).
• It's been on market 127 days — a 12% lower offer ($383k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $383k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#517 in FL) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A-; Watch: schools C-, amenities F, commute F.
• Indian River (other): math 48% / reading 52% proficiency, ranked #35 of 73 in FL (top 48%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: flood insurance adds $66/mo; HOA is 31% of rent.
• Market conditions: Rents rising fast (+11.0%/yr); 498 active listings in the ZIP; 33 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 564 units permitted in Indian River County in 2024 (281 in 5+ unit buildings).
• Indian River County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 10 sale attempts since 2y ago; this cycle's ask is 13932% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $122k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.9% vs local median 1.5% in Indian River Shores — 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 $6,699/mo this rent would consume 54% of the median local household income ($150k/yr) (locally 119% 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 127 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1977 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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.