8275 Mertztown Rd

Breinigsville, PA 18011

$300,000D

3 bd · 1.0 ba · 1,456 sqft · Built 1948 · SingleFamily · Pending · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,359/mo
• Mortgage (P&I): −$1,573
• Tax + insurance: −$464
• HOA: −$0
• Vac / Maint / Mgmt: −$495
• Net cashflow: $-174/mo
• Annual: $-2,085/yr
• Cap rate: 5.60%
• Cash-on-cash: -2.48%
• DSCR: 0.89
• 1% rule: 0.79%
• Cash to close: $84,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $300k.
• At list price, monthly cash flow is $-174 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $269k (10.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $236k (21.4% below list).
• It's been on market 27 days — a 2% lower offer ($296k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $236k (21.4% 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 $9k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#1,251 in PA) — a middle-class / working-renter tenant base. Strengths: crime A+, housing A+, employment B+; Watch: amenities F, commute F, health & safety F.
• East Penn SD (suburban): math 43% / reading 65% proficiency, ranked #103 of 539 in PA (top 19%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 17% free/reduced lunch — higher-income household profile.
• Zoned schools: Alburtis El Sch (math 47% / reading 67%, grade C+, #444 of 1,518 statewide, top 32%, 349 students, 33% FRL); Lower Macungie Ms (math 23% / reading 61%, grade D-, #221 of 512 statewide, top 45%, 1,043 students, 36% FRL); Emmaus Hs (math 65% / reading 24%, grade D-, #195 of 437 statewide, top 44%, 2,846 students, 24% FRL).
• Watch-outs: built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 16 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 4 sale attempts 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.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.6% vs local median 2.9% in Breinigsville — 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.

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?
• Built in 1948 — 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.
• 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.