2424 West Ave

Norfolk, VA 23504

$224,900C

3 bd · 2.0 ba · 1,717 sqft · Built 1916 · SingleFamily · Under Contract · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,138/mo
• Mortgage (P&I): −$1,179
• Tax + insurance: −$266
• HOA: −$0
• Vac / Maint / Mgmt: −$449
• Net cashflow: $244/mo
• Annual: $2,923/yr
• Cap rate: 7.59%
• Cash-on-cash: 4.64%
• DSCR: 1.21
• 1% rule: 0.95%
• Cash to close: $62,972

Investor read

• This is a 3-bed/2.0-bath single-family listed at $225k.
• At list price, monthly cash flow is $244 ($3k/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 $214k (5.0% below list).
• It's been on market 20 days — a 2% lower offer ($222k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $214k (5.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#43 in VA, #1,026 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, health & safety A+; Watch: employment C-, crime F.
• Norfolk City Public School District (urban): math 27% / reading 56% proficiency, ranked #118 of 131 in VA (top 90%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Lindenwood Elementary (math 8% / reading 32%, grade F, #1,082 of 1,108 statewide, top 98%, 262 students, 98% FRL); Blair Middle (math 29% / reading 57%, grade D-, #288 of 342 statewide, top 85%, 1,149 students, 92% FRL); Granby High (math 33% / reading 80%, grade C, #270 of 319 statewide, top 86%, 1,837 students, 94% FRL) — zoned schools average 95% FRL vs 59% district-wide (36 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1916 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.1%/yr); 122 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 438 units permitted in Norfolk city in 2024 (273 in 5+ unit buildings).
• 5 sale attempts since 8y 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 $110k; list at $225k implies a 104% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.6% vs local median 4.0% in Norfolk — 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 $2,138/mo this rent would consume 57% of the median local household income ($45k/yr) (locally 1531% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1916 — 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.
• 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.