2 N Main St

Winchester, KY 40391

$1,575,000C+

36 bd · 19.2 ba · 26,124 sqft · Built — · MultiFamily · Active · 269 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $19,629/mo
• Mortgage (P&I): −$8,259
• Tax + insurance: −$2,625
• HOA: −$0
• Vac / Maint / Mgmt: −$4,122
• Net cashflow: $4,622/mo
• Annual: $55,469/yr
• Cap rate: 9.81%
• Cash-on-cash: 12.58%
• DSCR: 1.56
• 1% rule: 1.25%
• Cash to close: $441,000

Investor read

• This is a 12 × 3-bed/1.6-bath units multifamily listed at $1.57M.
• At list price, monthly cash flow is $5k ($55k/yr) — positive. Per door: $385/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($20k rent vs $1.57M).
• It's been on market 269 days — a 12% lower offer ($1.39M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.39M (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $11k of loan paydown is wiped out by about $47k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#393 in KY) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: amenities F, commute F, employment F.
• Clark County (town): math 28% / reading 41% proficiency, ranked #64 of 165 in KY (top 39%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Willis H. Justice Elementary School (math 27% / reading 27%, grade F, #434 of 676 statewide, top 69%, 427 students, 66% FRL); Robert D. Campbell Jr. High (math 28% / reading 47%, grade F, #73 of 217 statewide, top 36%, 820 students, 57% FRL).
• Market conditions: 291 active listings in the ZIP; 160 units permitted in Clark County in 2024 (61 in 5+ unit buildings).
• Clark County population projected to shrink 7% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $441k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 9.8% vs local median 4.0% in Winchester — 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 $19,629/mo this rent would consume 367% of the median local household income ($64k/yr) (locally 854% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 269 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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?
• 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.
• 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.