18 Coastal Dr

West Ocean City, MD 21811

$350,000C-

3 bd · 2.0 ba · 1,648 sqft · Built 1990 · Manufactured · Pending · 146 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,485/mo
• Mortgage (P&I): −$1,835
• Tax + insurance: −$414
• HOA: −$95
• Vac / Maint / Mgmt: −$732
• Net cashflow: $409/mo
• Annual: $4,909/yr
• Cap rate: 7.92%
• Cash-on-cash: 5.82%
• DSCR: 1.26
• 1% rule: 1.00%
• Cash to close: $98,000

Investor read

• This is a 3-bed/2.0-bath manufactured listed at $350k.
• At list price, monthly cash flow is $409 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $349k (0.4% below list).
• It's been on market 146 days — a 12% lower offer ($308k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $308k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#69 in MD, #2,499 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A+; Watch: amenities C-, commute F, cost of living D-.
• 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: Ocean City Elementary (math 37% / reading 47%, grade F, #84 of 860 statewide, top 10%, 521 students, 44% FRL); Stephen Decatur Middle (math 24% / reading 43%, grade F, #53 of 225 statewide, top 24%, 697 students, 50% FRL); Stephen Decatur High (math 64% / reading 78%, grade B+, #37 of 222 statewide, top 17%, 1,431 students, 42% FRL).
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 315 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 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.
• 7 sale attempts since 20y ago; this cycle's ask has dropped $30k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $213k; list at $350k implies a 64% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe flood risk; severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.9% vs local median 2.6% in West Ocean 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.
• At $3,485/mo this rent would consume 46% of the median local household income ($90k/yr) (locally 551% 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 146 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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.