338 Sophee Ln #338

Lakewood, NJ 08701

$235,900F

2 bd · 2.0 ba · 1,165 sqft · Built 2005 · Condo · Active · 167 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,091/mo
• Mortgage (P&I): −$1,237
• Tax + insurance: −$393
• HOA: −$500
• Vac / Maint / Mgmt: −$439
• Net cashflow: $-478/mo
• Annual: $-5,739/yr
• Cap rate: 3.86%
• Cash-on-cash: -8.69%
• DSCR: 0.61
• 1% rule: 0.89%
• Cash to close: $66,052

Investor read

• This is a 2-bed/2.0-bath condo listed at $236k. Condition is rated good.
• At list price, monthly cash flow is $-478 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $167k (29.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $209k (11.4% below list).
• It's been on market 167 days — a 12% lower offer ($208k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $167k (29.3% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#382 in NJ) — a middle-class / working-renter tenant base. Strengths: crime A+, health & safety A+; Watch: employment C-, amenities F, commute F.
• Lakewood Township School District (suburban): math 17% / reading 28% proficiency, ranked #417 of 472 in NJ (top 88%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 82% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Oak Street Elem School (math 17% / reading 21%, grade F, #1,030 of 1,303 statewide, top 80%, 534 students, 97% FRL); Lakewood Middle School (math 16% / reading 30%, grade F, #376 of 431 statewide, top 88%, 995 students, 94% FRL); Lakewood High School (math 14% / reading 37%, grade F, #321 of 399 statewide, top 81%, 1,423 students, 86% FRL).
• Watch-outs: HOA is 24% of rent.
• Market conditions: 749 active listings in the ZIP; 24 comparable units currently listed for rent nearby; rentals lingering (median 53d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• Climate carrying-cost: major wind risk, 68% chance of damaging wind over 30y; extreme-heat days projected 7→14/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 3.9% vs local median 2.7% in Lakewood — 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 39% of the median local income ($65k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 167 days. Have you received any prior offers? Is the seller open to a 29% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?