422 Forrest Ave

Lacey, NJ 08734

$439,000B+

3 bd · 2.0 ba · 2,340 sqft · Built 1962 · SingleFamily · Active · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $12,003/mo
• Mortgage (P&I): −$2,302
• Tax + insurance: −$775
• HOA: −$0
• Vac / Maint / Mgmt: −$2,521
• Net cashflow: $6,405/mo
• Annual: $76,865/yr
• Cap rate: 23.98%
• Cash-on-cash: 63.18%
• DSCR: 3.81
• 1% rule: 2.73%
• Cash to close: $122,920

Investor read

• This is a 3-bed/2.0-bath single-family listed at $439k.
• At list price, monthly cash flow is $6k ($77k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($12k rent vs $439k).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• 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: area grade B — affects rentability + tenant quality, not the cash-flow math above.
• Lacey Township School District (suburban): math 22% / reading 43% proficiency, ranked #299 of 472 in NJ (top 63%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; only 19% free/reduced lunch — higher-income household profile.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 57 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 2d on market — plan ~1-2 weeks tenant-placement turnaround); 4,434 units permitted in Ocean County in 2024 (868 in 5+ unit buildings).
• Ocean County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 8 sale attempts since 10y ago; this cycle's ask is 60% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $255k; list at $439k implies a 72% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $123k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• Built in 1962 — 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?
• 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.
• 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.