390 Totowa

Paterson, NJ 07501

$599,900C+

16 bd · 16.0 ba · — sqft · Built 1990 · MultiFamily · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,825/mo
• Mortgage (P&I): −$3,146
• Tax + insurance: −$1,000
• HOA: −$0
• Vac / Maint / Mgmt: −$1,433
• Net cashflow: $1,246/mo
• Annual: $14,952/yr
• Cap rate: 8.79%
• Cash-on-cash: 8.90%
• DSCR: 1.40
• 1% rule: 1.14%
• Cash to close: $167,972

Investor read

• This is a 4 × 1-bed/1.0-bath units multifamily listed at $600k. Condition is rated fair.
• At list price, monthly cash flow is $1k ($15k/yr) — positive. Per door: $311/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $600k).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• In year one you build about $10k of equity ($4k loan paydown + $6k appreciation (1.0% local appreciation)).
• Location reads 69/100 on livability (#293 in NJ) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, health & safety A; Watch: schools D, employment D, crime F.
• Paterson Public School District (suburban): math 6% / reading 26% proficiency, ranked #458 of 472 in NJ (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 83% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+11.4%/yr); 52 active listings in the ZIP; lower-income renter base — watch delinquency; 860 units permitted in Passaic County in 2024 (614 in 5+ unit buildings).
• Passaic County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (1.0% appreciation + 8.0% rent growth), your $168k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$37k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 8.8% vs local median 3.5% in Paterson — 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 $6,825/mo this rent would consume 185% of the median local household income ($44k/yr) (locally 3954% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• 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?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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 F 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?
• 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.

Repairs flagged (vision-AI assessment)

• Major: exterior siding — Significant wear and tear
• Major: roof — No visible damage, but age is implied
• Major: HVAC/mechanicals — No visible systems, but age is implied