28 North St

Mechanic Falls, ME 04256

$40,000B-

2 bd · 1.0 ba · 700 sqft · Built 1980 · MultiFamily · Pending · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,152/mo
• Mortgage (P&I): −$210
• Tax + insurance: −$46
• HOA: −$350
• Vac / Maint / Mgmt: −$452
• Net cashflow: $1,094/mo
• Annual: $13,133/yr
• Cap rate: 39.12%
• Cash-on-cash: 117.26%
• DSCR: 6.22
• 1% rule: 5.38%
• Cash to close: $11,200

Investor read

• This is a 2-bed/1.0-bath multifamily listed at $40k.
• At list price, monthly cash flow is $1k ($13k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $40k).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• In year one you build about $4k of equity ($277 loan paydown + $4k appreciation (10.0% local appreciation)).
• Location reads 69/100 on livability (#78 in ME) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D+, amenities F, commute F.
• RSU 16 (rural): math 79% / reading 83% proficiency, ranked #73 of 112 in ME (top 65%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: Elm Street School-Mechanic Falls (math 72% / reading 77%, grade A, #228 of 294 statewide, top 84%, 245 students, 41% FRL); Bruce M Whittier Middle School (math 81% / reading 84%, grade A+, #51 of 85 statewide, top 61%, 281 students, 36% FRL); Poland Regional H S (math 87% / reading 87%, grade A, #66 of 108 statewide, top 68%, 535 students, 30% FRL) — zoned schools at 36% FRL track the district average.
• Market conditions: 21 active listings in the ZIP; 358 units permitted in Androscoggin County in 2024 (57 in 5+ unit buildings).
• Androscoggin County population projected at -19% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $11k cash investment doubles in ~1 year — after that, you're playing with house money.
• By year 7, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 39.1% vs local median 2.4% in Mechanic Falls — 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.

Questions for listing agent

• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.