429 Thompson Ave

East Haven, CT 06512

$489,000B-

4 bd · 3.0 ba · 2,004 sqft · Built 1910 · MultiFamily · Under Contract · 24 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,855/mo
• Mortgage (P&I): −$2,564
• Tax + insurance: −$613
• HOA: −$0
• Vac / Maint / Mgmt: −$1,650
• Net cashflow: $3,028/mo
• Annual: $36,336/yr
• Cap rate: 13.72%
• Cash-on-cash: 26.54%
• DSCR: 2.18
• 1% rule: 1.61%
• Cash to close: $136,920

Investor read

• This is a 3 × 4-bed/3.0-bath units multifamily listed at $489k.
• At list price, monthly cash flow is $3k ($36k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $489k).
• It's been on market 24 days — a 2% lower offer ($482k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $482k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $15k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#99 in CT) — a middle-class / working-renter tenant base. Strengths: housing A+, crime A-, health & safety B+; Watch: amenities F, commute F.
• East Haven School District (suburban): math 25% / reading 40% proficiency, ranked #118 of 153 in CT (top 77%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Carbone School/East Haven Academy (math 30% / reading 53%, grade F, #294 of 553 statewide, top 53%, 333 students, 38% FRL); Joseph Melillo Middle School (math 23% / reading 36%, grade F, #140 of 175 statewide, top 81%, 516 students, 59% FRL); East Haven High School (math 17% / reading 42%, grade F, #139 of 194 statewide, top 74%, 849 students, 47% FRL).
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 104 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 44% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 1,059 units permitted in South Central Connecticut Planning Region in 2024 (779 in 5+ unit buildings).
• Current owner paid $140k; list at $489k implies a 249% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 0.8% rent growth), your $137k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 62% 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 13.7% vs local median 3.9% in East Haven — 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 $7,855/mo this rent would consume 98% of the median local household income ($96k/yr) (locally 770% 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?
• Built in 1910 — 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 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?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.