5 Smugglers Rowe

Roche Harbor, WA 98250

$1,598,000B

2 bd · 1.0 ba · 1,504 sqft · Built 1999 · SingleFamily · Active · 127 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $25,000/mo
• Mortgage (P&I): −$8,380
• Tax + insurance: −$2,730
• HOA: −$0
• Vac / Maint / Mgmt: −$5,250
• Net cashflow: $8,640/mo
• Annual: $103,681/yr
• Cap rate: 12.83%
• Cash-on-cash: 23.35%
• DSCR: 2.04
• 1% rule: 1.56%
• Cash to close: $447,440

Investor read

• This is a 2-bed/1.0-bath single-family listed at $1.60M.
• At list price, monthly cash flow is $9k ($104k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($25k rent vs $1.60M).
• It's been on market 127 days — a 12% lower offer ($1.41M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.41M (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 $48k of value loss. Plan a longer hold.
• Location reads: area grade B — affects rentability + tenant quality, not the cash-flow math above.
• San Juan Island School District (rural): math 61% / reading 67% proficiency, ranked #36 of 291 in WA (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Friday Harbor Elementary School (321 students, 38% FRL); Friday Harbor Middle School (178 students, 50% FRL); Friday Harbor High School (245 students, 42% FRL).
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 165 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 99 units permitted in San Juan County in 2024 (0 in 5+ unit buildings).
• San Juan County population projected at +6% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 10y 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 $775k; list at $1.60M implies a 106% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $447k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.8% vs local median 0.5% in Roche Harbor — 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 127 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.
• 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.