24 Vernon St Unit B

Providence, RI 02903

$325,000D-

3 bd · 1.5 ba · 1,680 sqft · Built 2003 · Condo · Pending · 41 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,818/mo
• Mortgage (P&I): −$1,704
• Tax + insurance: −$542
• HOA: −$200
• Vac / Maint / Mgmt: −$592
• Net cashflow: $-220/mo
• Annual: $-2,639/yr
• Cap rate: 5.48%
• Cash-on-cash: -2.90%
• DSCR: 0.87
• 1% rule: 0.87%
• Cash to close: $91,000

Investor read

• This is a 3-bed/1.5-bath condo listed at $325k.
• At list price, monthly cash flow is $-220 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $293k (9.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $282k (13.3% below list).
• It's been on market 41 days — a 3% lower offer ($315k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $282k (13.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-1.1%/yr); year-one equity from $2k of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#2 in RI, #794 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+; Watch: employment C-.
• Providence (urban): math 8% / reading 16% proficiency, ranked #34 of 39 in RI (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: George J. West El. School (math 7% / reading 13%, grade F, #148 of 167 statewide, top 90%, 601 students, 84% FRL); Nathanael Greene Middle (math 10% / reading 23%, grade F, #37 of 57 statewide, top 64%, 808 students, 85% FRL); Central High School (math 2% / reading 12%, grade F, #53 of 58 statewide, top 96%, 1,302 students, 87% FRL).
• Market conditions: Rents rising fast (+4.7%/yr); 59 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 776 units permitted in Providence County in 2024 (229 in 5+ unit buildings).
• Providence County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 21y ago; this cycle's ask has dropped $44k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $213k; list at $325k implies a 53% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 74% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.5% vs local median 4.0% in Providence — 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 $2,818/mo this rent would consume 52% of the median local household income ($64k/yr) (locally 1009% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 41 days. Have you received any prior offers? Is the seller open to a 13% 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-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?
• 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.