402 Cherry St

Easton, MD 21601

$360,000D

3 bd · 2.0 ba · 1,712 sqft · Built 1920 · SingleFamily · Active · 85 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,965/mo
• Mortgage (P&I): −$1,888
• Tax + insurance: −$282
• HOA: −$0
• Vac / Maint / Mgmt: −$623
• Net cashflow: $173/mo
• Annual: $2,073/yr
• Cap rate: 6.87%
• Cash-on-cash: 2.06%
• DSCR: 1.09
• 1% rule: 0.82%
• Cash to close: $100,800

Investor read

• This is a 3-bed/2.0-bath single-family listed at $360k.
• At list price, monthly cash flow is $173 ($2k/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 $297k (17.6% below list).
• It's been on market 85 days — a 6% lower offer ($338k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $297k (17.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#154 in MD) — a middle-class / working-renter tenant base. Strengths: health & safety A+, housing A-, employment B+; Watch: amenities C-, crime D, commute F.
• Talbot County Public Schools (town): math 15% / reading 35% proficiency, ranked #12 of 24 in MD (top 50%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Easton Elementary (math 10% / reading 19%, grade F, #477 of 860 statewide, top 59%, 1,078 students, 76% FRL); Easton Middle (math 9% / reading 32%, grade F, #141 of 225 statewide, top 65%, 737 students, 62% FRL); Easton High (math 40% / reading 65%, grade C-, #98 of 222 statewide, top 44%, 1,203 students, 56% FRL) — zoned schools average 65% FRL vs 37% district-wide (28 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 208 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 83% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 158 units permitted in Talbot County in 2024 (0 in 5+ unit buildings).
• Talbot County population projected at -10% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 8 sale attempts since 29y ago; this cycle's ask has dropped $45k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $290k; 24% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wind risk, 61% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.9% vs local median 3.6% in Easton — 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 43% of the median local income ($84k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 85 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• Built in 1920 — 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.
• 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?
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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?
• 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.