223 Orchard Trace Ln #5

Charlotte, NC 28213

$138,000D

2 bd · 2.0 ba · 897 sqft · Built 1974 · Condo · Active · 113 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,425/mo
• Mortgage (P&I): −$724
• Tax + insurance: −$137
• HOA: −$278
• Vac / Maint / Mgmt: −$299
• Net cashflow: $-13/mo
• Annual: $-162/yr
• Cap rate: 6.18%
• Cash-on-cash: -0.42%
• DSCR: 0.98
• 1% rule: 1.03%
• Cash to close: $38,640

Investor read

• This is a 2-bed/2.0-bath condo listed at $138k.
• At list price, monthly cash flow is $-13 ($-162/yr) — negative.
• To cash-flow at today's rent, offer at most $136k (1.7% below list).
• Meets the 1% rule at list price ($1k rent vs $138k).
• It's been on market 113 days — a 9% lower offer ($126k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $126k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $954 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#26 in NC, #2,502 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: crime F.
• Charlotte-Mecklenburg Schools (urban): math 42% / reading 46% proficiency, ranked #85 of 178 in NC (top 48%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Newell Elementary (math 14% / reading 19%, grade F, #1,307 of 1,410 statewide, top 93%, 699 students, 100% FRL); Martin Luther King Jr Middle (math 11% / reading 20%, grade F, #456 of 475 statewide, top 96%, 931 students, 100% FRL); Julius L. Chambers High School (math 40% / reading 35%, grade F, #411 of 535 statewide, top 77%, 2,224 students, 100% FRL) — zoned schools average 100% FRL vs 49% district-wide (51 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 23% at this address vs 44% district-wide (-21 pts) — the specific schools serving this property underperform the Charlotte-Mecklenburg Schools average; the district grade overstates school quality for this exact location.
• Market conditions: Rents flat; 283 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); 11,969 units permitted in Mecklenburg County in 2024 (5,377 in 5+ unit buildings).
• Mecklenburg County population projected at +53% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 16y 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 $60k; list at $138k implies a 130% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate wind risk, 23% 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 6.2% vs local median 3.1% in Charlotte — 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.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 113 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1974 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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 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?