786 Quince Orchard Blvd Unit 786-P2

Gaithersburg, MD 20878

$145,000D

1 bd · 1.0 ba · 1,009 sqft · Built 1967 · Condo · Active · 80 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,914/mo
• Mortgage (P&I): −$760
• Tax + insurance: −$242
• HOA: −$783
• Vac / Maint / Mgmt: −$402
• Net cashflow: $-273/mo
• Annual: $-3,279/yr
• Cap rate: 4.03%
• Cash-on-cash: -8.08%
• DSCR: 0.64
• 1% rule: 1.32%
• Cash to close: $40,600

Investor read

• This is a 1-bed/1.0-bath condo listed at $145k. Condition is rated good.
• At list price, monthly cash flow is $-273 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $105k (27.3% below list).
• Meets the 1% rule at list price ($2k rent vs $145k).
• It's been on market 80 days — a 6% lower offer ($136k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $105k (27.3% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#59 in MD, #2,228 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, employment A+, housing A+; Watch: cost of living F.
• Montgomery County Public Schools (suburban): math 27% / reading 45% proficiency, ranked #3 of 24 in MD (top 12%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Brown Station Elementary (math 14% / reading 18%, grade F, #441 of 860 statewide, top 52%, 617 students, 75% FRL); Lakelands Park Middle (math 21% / reading 51%, grade F, #40 of 225 statewide, top 18%, 1,042 students, 34% FRL); Quince Orchard High (math 47% / reading 62%, grade C-, #91 of 222 statewide, top 42%, 2,154 students, 41% FRL) — zoned schools average 50% FRL vs 26% district-wide (24 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: HOA is 41% of rent.
• Market conditions: Rents soft (-0.3%/yr); 219 active listings in the ZIP; 21 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 48% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 3,880 units permitted in Montgomery County in 2024 (2,054 in 5+ unit buildings).
• Montgomery County population projected at +27% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts; this cycle's ask has dropped $20k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.0% vs local median 3.0% in Gaithersburg — 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.
• This rent is only 16% of the median local income ($144k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 80 days. Have you received any prior offers? Is the seller open to a 27% concession, seller financing, or rate buy-down credit?
• Built in 1967 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.
• 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?