703 Court St

Honesdale, PA 18431

$399,900B

8 bd · 4.0 ba · 2,560 sqft · Built 1920 · MultiFamily · Pending · 19 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,400/mo
• Mortgage (P&I): −$2,097
• Tax + insurance: −$511
• HOA: −$0
• Vac / Maint / Mgmt: −$1,134
• Net cashflow: $1,658/mo
• Annual: $19,900/yr
• Cap rate: 11.44%
• Cash-on-cash: 18.37%
• DSCR: 1.82
• 1% rule: 1.35%
• Cash to close: $111,972

Investor read

• This is a 3 × 3-bed/?-bath units multifamily listed at $400k.
• At list price, monthly cash flow is $2k ($20k/yr) — positive. Per door: $553/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $400k).
• It's been on market 19 days — a 2% lower offer ($394k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $394k (1.5% below list) — sets the bar for market timing.
• In year one you build about $43k of equity ($3k loan paydown + $40k appreciation (10.0% local appreciation)).
• Location reads 64/100 on livability (#1,220 in PA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A, crime A-; Watch: amenities F, commute F, employment F.
• Wayne Highlands SD (town): math 48% / reading 64% proficiency, ranked #115 of 539 in PA (top 21%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: flood insurance adds $56/mo; built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 66 active listings in the ZIP; 177 units permitted in Wayne County in 2024 (0 in 5+ unit buildings).
• Wayne County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts since 14y 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 $115k; list at $400k implies a 248% gain — meaningful room to come down on a strong offer.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $112k cash investment doubles in ~2 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$69k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.4% vs local median 5.1% in Honesdale — 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

• 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 1920 — 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.
• 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?
• This sits on a lake — are riparian / water-frontage rights deeded with the parcel? Any dock permits, shoreline easements, or HOA water-use restrictions?
• What's the documented flood / surge / shoreline-erosion history here (FEMA AND non-FEMA — e.g., storm surge, creek backup, septic-field saturation)?