578 Broad St

Emmaus, PA 18049

$340,000C+

4 bd · 2.0 ba · 2,536 sqft · Built 1880 · MultiFamily · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,715/mo
• Mortgage (P&I): −$1,783
• Tax + insurance: −$567
• HOA: −$0
• Vac / Maint / Mgmt: −$780
• Net cashflow: $585/mo
• Annual: $7,022/yr
• Cap rate: 8.36%
• Cash-on-cash: 7.38%
• DSCR: 1.33
• 1% rule: 1.09%
• Cash to close: $95,200

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $340k. Condition is rated good.
• At list price, monthly cash flow is $585 ($7k/yr) — positive. Per door: $293/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $340k).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 86/100 on livability (#61 in PA, #424 nationally) — a professional / high-income tenant draw. Strengths: crime A+, amenities A+, cost of living A+; Watch: commute F.
• East Penn SD (suburban): math 43% / reading 65% proficiency, ranked #103 of 539 in PA (top 19%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 17% free/reduced lunch — higher-income household profile.
• Zoned schools: Lincoln El Sch (math 42% / reading 62%, grade C-, #586 of 1,518 statewide, top 42%, 399 students, 38% FRL); Lower Macungie Ms (math 23% / reading 61%, grade D-, #221 of 512 statewide, top 45%, 1,043 students, 36% FRL); Emmaus Hs (math 65% / reading 24%, grade D-, #195 of 437 statewide, top 44%, 2,846 students, 24% FRL) — zoned schools average 33% FRL vs 17% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1880 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.2%/yr); 98 active listings in the ZIP; solid renter incomes; 765 units permitted in Lehigh County in 2024 (286 in 5+ unit buildings).
• Lehigh County population projected at +21% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (-3.0% appreciation + 6.2% rent growth), your $95k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.4% vs local median 3.4% in Emmaus — 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 $3,715/mo this rent would consume 48% of the median local household income ($94k/yr) (locally 645% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1880 — 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?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.