35 Mercury Ave

East Patchogue, NY 11772

$499,999D

5 bd · 2.5 ba · 1,736 sqft · Built 1975 · SingleFamily · Active · 41 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,087/mo
• Mortgage (P&I): −$2,622
• Tax + insurance: −$1,012
• HOA: −$0
• Vac / Maint / Mgmt: −$858
• Net cashflow: $-405/mo
• Annual: $-4,864/yr
• Cap rate: 5.32%
• Cash-on-cash: -3.47%
• DSCR: 0.85
• 1% rule: 0.82%
• Cash to close: $140,000

Investor read

• This is a 5-bed/2.5-bath single-family listed at $500k.
• At list price, monthly cash flow is $-405 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $428k (14.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $409k (18.3% below list).
• It's been on market 41 days — a 3% lower offer ($485k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $409k (18.3% below list) — sets the bar for 1% rule.
• 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 64/100 on livability (#769 in NY) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety B; Watch: amenities F, commute F, cost of living F.
• South Country Central School District (suburban): math 50% / reading 44% proficiency, ranked #460 of 755 in NY (top 61%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Brookhaven Elementary School (506 students, 41% FRL); Bellport Middle School (math 64% / reading 54%, grade B, #161 of 729 statewide, top 24%, 838 students, 56% FRL); Bellport Senior High School (math 86% / reading 64%, grade A-, #630 of 1,100 statewide, top 57%, 1,392 students, 52% FRL).
• Zoned-school proficiency averages 67% at this address vs 47% district-wide (+20 pts) — the actual schools serving this property are materially stronger than the South Country Central School District average implies; a family-tenant draw the district grade alone would hide.
• Market conditions: Rents rising fast (+5.1%/yr); 219 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 1,366 units permitted in Suffolk County in 2024 (216 in 5+ unit buildings).
• Suffolk County population projected to shrink 5% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Current owner paid $135k; list at $500k implies a 270% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.3% vs local median 3.1% in East Patchogue — 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 $4,087/mo this rent would consume 47% of the median local household income ($105k/yr) (locally 1595% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 41 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• Built in 1975 — 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?
• 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.