92-94 Cedar Ave

Newark, NJ 07106-1355

$579,000C-

6 bd · 3.0 ba · 2,997 sqft · Built 1930 · MultiFamily · Under Contract · 73 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,823/mo
• Mortgage (P&I): −$3,036
• Tax + insurance: −$1,031
• HOA: −$0
• Vac / Maint / Mgmt: −$1,223
• Net cashflow: $532/mo
• Annual: $6,388/yr
• Cap rate: 7.53%
• Cash-on-cash: 4.43%
• DSCR: 1.20
• 1% rule: 1.01%
• Cash to close: $162,120

Investor read

• This is a 3 × 2-bed/1.0-bath units multifamily listed at $579k.
• At list price, monthly cash flow is $532 ($6k/yr) — positive. Per door: $177/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $579k).
• It's been on market 73 days — a 6% lower offer ($544k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $544k (6.0% below list) — sets the bar for market timing.
• In year one you build about $21k of equity ($4k loan paydown + $17k appreciation (3.0% local appreciation)).
• Location reads 67/100 on livability (#343 in NJ) — a middle-class / working-renter tenant base. Strengths: commute A+, amenities A-; Watch: schools D+, housing D+, crime F.
• Newark Public School District (urban): math 9% / reading 26% proficiency, ranked #452 of 472 in NJ (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $66/mo; built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 1 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 3,364 units permitted in Essex County in 2024 (2,551 in 5+ unit buildings).
• Essex County population projected at +3% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 9y 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 $130k; list at $579k implies a 346% gain — meaningful room to come down on a strong offer.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $162k cash investment doubles in ~6 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major flood risk; major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.5% vs local median 3.0% in Newark — 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 73 days. Have you received any prior offers? Is the seller open to a 6% 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?
• Built in 1930 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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?