1116 Sherbourne Way

Ormond Beach, FL 32174

$374,900C-

3 bd · 2.0 ba · 1,757 sqft · Built 1982 · SingleFamily · Pending

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,739/mo
• Mortgage (P&I): −$1,966
• Tax + insurance: −$534
• HOA: −$0
• Vac / Maint / Mgmt: −$785
• Net cashflow: $454/mo
• Annual: $5,450/yr
• Cap rate: 7.96%
• Cash-on-cash: 5.95%
• DSCR: 1.26
• 1% rule: 1.00%
• Cash to close: $104,972

Investor read

• This is a 3-bed/2.0-bath single-family listed at $375k.
• At list price, monthly cash flow is $454 ($5k/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 $374k (0.3% below list).
• Only 0 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $374k (0.3% 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 $11k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#55 in FL, #965 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, housing A+, health & safety A+; Watch: commute F.
• Volusia (suburban): math 44% / reading 49% proficiency, ranked #47 of 73 in FL (top 64%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Pine Trail Elementary School (math 77% / reading 72%, grade A, #230 of 2,144 statewide, top 12%, 688 students, 45% FRL); Ormond Beach Middle School (math 57% / reading 55%, grade B-, #175 of 571 statewide, top 31%, 990 students, 48% FRL); Seabreeze High School (math 31% / reading 56%, grade F, #248 of 667 statewide, top 38%, 1,654 students, 41% FRL).
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: Rents rising (+1.6%/yr); 985 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 20d on market — plan ~3-4 weeks tenant-placement turnaround); 3,402 units permitted in Volusia County in 2024 (681 in 5+ unit buildings).
• Volusia County population projected at +19% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 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 $280k; 34% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: severe flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.0% vs local median 3.9% in Ormond Beach — 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 $3,739/mo this rent would consume 63% of the median local household income ($71k/yr) (locally 1158% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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?
• 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.