234 Locust St

Steelton, PA 17113

$165,000B

4 bd · 2.0 ba · 2,610 sqft · Built 1900 · MultiFamily · Active · 74 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,507/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$292
• HOA: −$0
• Vac / Maint / Mgmt: −$526
• Net cashflow: $823/mo
• Annual: $9,873/yr
• Cap rate: 12.28%
• Cash-on-cash: 21.37%
• DSCR: 1.95
• 1% rule: 1.52%
• Cash to close: $46,200

Investor read

• This is a 2 × 2-bed/1-bath units multifamily listed at $165k.
• At list price, monthly cash flow is $823 ($10k/yr) — positive. Per door: $411/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $165k).
• It's been on market 74 days — a 6% lower offer ($155k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $155k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#971 in PA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment C-, crime F, amenities F.
• Steelton-Highspire SD (suburban): math 2% / reading 9% proficiency, ranked #538 of 539 in PA (top 100%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Steelton-Highspire El Sch (math 2% / reading 12%, grade F, #1,491 of 1,518 statewide, top 98%, 738 students, 100% FRL); Steelton-Highspire Hs (math 2% / reading 6%, grade F, #434 of 437 statewide, top 99%, 599 students, 100% FRL) — zoned schools average 100% FRL vs 68% district-wide (32 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 68 active listings in the ZIP; 540 units permitted in Dauphin County in 2024 (194 in 5+ unit buildings).
• 3 sale attempts since 23y ago; this cycle's ask has dropped $20k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $126k; 31% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $46k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.3% vs local median 7.1% in Steelton — 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.
• This rent runs 44% of the median local income ($68k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 74 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• 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 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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?