Pinnacle (Applewood) Plan

Middletown, OH 45044

$111,995F

5 bd · 3.0 ba · 2,027 sqft · Built — · SingleFamily · Active · 323 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,194/mo
• Mortgage (P&I): −$1,892
• Tax + insurance: −$601
• HOA: −$580
• Vac / Maint / Mgmt: −$461
• Net cashflow: $-1,340/mo
• Annual: $-16,085/yr
• Cap rate: 1.83%
• Cash-on-cash: -15.92%
• DSCR: 0.29
• 1% rule: 0.61%
• Cash to close: $101,026

Investor read

• This is a 5-bed/3.0-bath single-family listed at $112k. Condition is rated good.
• At list price, monthly cash flow is $-1k ($-16k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $112k).
• It's been on market 323 days — a 12% lower offer ($99k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $99k (12.0% below list) — sets the bar for market timing.
• 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 72/100 on livability (#389 in OH) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, crime D+, amenities D+.
• Middletown City (suburban): math 21% / reading 28% proficiency, ranked #610 of 656 in OH (top 93%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 69% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 4.8% of price; HOA is 26% of rent.
• Market conditions: Rents rising fast (+6.3%/yr); 203 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 1,163 units permitted in Butler County in 2024 (356 in 5+ unit buildings).
• Cap rate 1.8% vs local median 4.5% in Middletown — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 36% of the median local income ($74k/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 323 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?