636 Rigel Way

Bear, DE 19701

$440,500D-

3 bd · 2.5 ba · 2,850 sqft · Built 2017 · Townhouse · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,189/mo
• Mortgage (P&I): −$2,310
• Tax + insurance: −$449
• HOA: −$107
• Vac / Maint / Mgmt: −$670
• Net cashflow: $-347/mo
• Annual: $-4,160/yr
• Cap rate: 5.35%
• Cash-on-cash: -3.37%
• DSCR: 0.85
• 1% rule: 0.72%
• Cash to close: $123,340

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $440k.
• At list price, monthly cash flow is $-347 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $379k (13.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $319k (27.6% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $319k (27.6% 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 $13k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#8 in DE) — a middle-class / working-renter tenant base. Strengths: housing A+, employment A-, cost of living A-; Watch: crime C-, amenities F, commute F.
• Colonial School District (suburban): math 15% / reading 30% proficiency, ranked #23 of 26 in DE (top 88%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Wilbur (Kathleen H.) Elementary (math 24% / reading 43%, grade F, #42 of 105 statewide, top 39%, 1,044 students, 0% FRL); Bedford (Gunning) Middle School (math 14% / reading 38%, grade F, #20 of 36 statewide, top 54%, 936 students, 0% FRL); Penn (William) High School (math 16% / reading 30%, grade F, #29 of 40 statewide, top 72%, 2,239 students, 0% FRL) — zoned schools average 0% FRL vs 53% district-wide (53 pts lower); this property's tenant base skews higher-income than the district average.
• Market conditions: Rents rising fast (+9.0%/yr); 112 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals leasing fast (median 1d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 1,367 units permitted in New Castle County in 2024 (201 in 5+ unit buildings).
• New Castle County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 3 sale attempts since 6y ago; this cycle's ask has dropped $59k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $345k; 28% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wind risk, 27% 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.
• This rent runs 34% of the median local income ($111k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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.