113 Pleasant St

Gloucester, MA 01930

$599,000C+

4 bd · 3.0 ba · 1,240 sqft · Built 1900 · MultiFamily · Active · 110 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,144/mo
• Mortgage (P&I): −$3,141
• Tax + insurance: −$663
• HOA: −$0
• Vac / Maint / Mgmt: −$1,290
• Net cashflow: $1,049/mo
• Annual: $12,593/yr
• Cap rate: 8.40%
• Cash-on-cash: 7.51%
• DSCR: 1.33
• 1% rule: 1.03%
• Cash to close: $167,720

Investor read

• This is a 3 × 1-bed/1-bath units multifamily listed at $599k.
• At list price, monthly cash flow is $1k ($13k/yr) — positive. Per door: $350/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $599k).
• It's been on market 110 days — a 9% lower offer ($545k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $545k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $18k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#119 in MA) — a middle-class / working-renter tenant base. Strengths: commute A+, employment A, crime B+; Watch: amenities F, cost of living F.
• Gloucester (suburban): math 33% / reading 46% proficiency, ranked #203 of 302 in MA (top 67%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.3%/yr); 72 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 1,032 units permitted in Essex County in 2024 (590 in 5+ unit buildings).
• Essex County population projected at +15% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 25y 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 $218k; list at $599k implies a 175% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $168k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.4% vs local median 2.5% in Gloucester — 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 $6,144/mo this rent would consume 88% of the median local household income ($84k/yr) (locally 1500% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 110 days. Have you received any prior offers? Is the seller open to a 9% 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.
• 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.