78 Montgomery St

Montgomery, PA 17752

$229,900F

3 bd · 1.5 ba · 1,456 sqft · Built 2013 · SingleFamily · Pending · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,401/mo
• Mortgage (P&I): −$1,206
• Tax + insurance: −$370
• HOA: −$0
• Vac / Maint / Mgmt: −$294
• Net cashflow: $-469/mo
• Annual: $-5,624/yr
• Cap rate: 3.85%
• Cash-on-cash: -8.74%
• DSCR: 0.61
• 1% rule: 0.61%
• Cash to close: $64,372

Investor read

• This is a 3-bed/1.5-bath single-family listed at $230k.
• At list price, monthly cash flow is $-469 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $147k (36.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $140k (39.1% below list).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $140k (39.1% below list) — sets the bar for 1% rule.
• In year one you build about $10k of equity ($2k loan paydown + $9k appreciation (3.8% local appreciation)).
• Location reads 71/100 on livability (#727 in PA) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: health & safety D, amenities F, commute F.
• Montgomery Area SD (town): math 46% / reading 54% proficiency, ranked #180 of 539 in PA (top 33%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 20 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 15d on market — plan ~3-4 weeks tenant-placement turnaround); 73 units permitted in Lycoming County in 2024 (15 in 5+ unit buildings).
• Lycoming County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 8y ago 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.
• Current owner paid $170k; 35% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• By year 4, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.