400 2nd St

Pocomoke City, MD 21851

$79,900B+

3 bd · 2.0 ba · 1,896 sqft · Built 1930 · SingleFamily · Active · 35 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,931/mo
• Mortgage (P&I): −$419
• Tax + insurance: −$277
• HOA: −$0
• Vac / Maint / Mgmt: −$406
• Net cashflow: $830/mo
• Annual: $9,955/yr
• Cap rate: 18.75%
• Cash-on-cash: 44.50%
• DSCR: 2.98
• 1% rule: 2.42%
• Cash to close: $22,372

Investor read

• This is a 3-bed/2.0-bath single-family listed at $80k.
• At list price, monthly cash flow is $830 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $80k).
• It's been on market 35 days — a 3% lower offer ($78k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $78k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $552 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#157 in MD) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A-; Watch: employment D+, crime F, amenities F.
• Worcester County Public Schools (town): math 30% / reading 44% proficiency, ranked #6 of 24 in MD (top 25%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Pocomoke Elementary (math 17% / reading 17%, grade F, #408 of 860 statewide, top 50%, 443 students, 76% FRL); Pocomoke Middle (math 22% / reading 29%, grade F, #97 of 225 statewide, top 46%, 448 students, 72% FRL); Pocomoke High (math 32% / reading 67%, grade D, #108 of 222 statewide, top 49%, 352 students, 70% FRL) — zoned schools average 73% FRL vs 39% district-wide (34 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 3.7% of price; built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 69 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); 354 units permitted in Worcester County in 2024 (6 in 5+ unit buildings).
• Worcester County population projected to shrink 4% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 31y ago; this cycle's ask has dropped $10k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $60k; 33% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $22k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 18.8% vs local median 5.6% in Pocomoke City — 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.

Questions for listing agent

• It's been on market 35 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1930 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.