1121 N 20th St

Allentown, PA 18104

$214,900C-

3 bd · 1.0 ba · 1,440 sqft · Built 1925 · Townhouse · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,071/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$416
• HOA: −$0
• Vac / Maint / Mgmt: −$435
• Net cashflow: $93/mo
• Annual: $1,120/yr
• Cap rate: 6.81%
• Cash-on-cash: 1.86%
• DSCR: 1.08
• 1% rule: 0.96%
• Cash to close: $60,172

Investor read

• This is a 3-bed/1.0-bath townhouse listed at $215k.
• At list price, monthly cash flow is $93 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $207k (3.6% below list).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $207k (3.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#171 in PA, #1,440 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: employment D.
• Allentown City SD (urban): math 10% / reading 20% proficiency, ranked #513 of 539 in PA (top 95%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 73% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Muhlenberg El Sch (math 17% / reading 50%, grade F, #1,086 of 1,518 statewide, top 72%, 488 students, 100% FRL); Trexler Ms (math 2% / reading 24%, grade F, #484 of 512 statewide, top 95%, 820 students, 100% FRL); William Allen Hs (math 29% / reading 10%, grade F, #392 of 437 statewide, top 90%, 2,852 students, 87% FRL) — zoned schools average 96% FRL vs 73% district-wide (23 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.1%/yr); 163 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 765 units permitted in Lehigh County in 2024 (286 in 5+ unit buildings).
• Lehigh County population projected at +21% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 24y 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 $137k; list at $215k implies a 57% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.8% vs local median 5.3% in Allentown — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

Questions for listing agent

• Built in 1925 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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 for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.