617 Front St Unit C-54 Penthouse Wk 36

Key West, FL 33040

$65,000D+

2 bd · 2.0 ba · 1,120 sqft · Built 1983 · SingleFamily · Active · 70 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,240/mo
• Mortgage (P&I): −$341
• Tax + insurance: −$108
• HOA: −$132
• Vac / Maint / Mgmt: −$680
• Net cashflow: $1,979/mo
• Annual: $23,743/yr
• Cap rate: 42.82%
• Cash-on-cash: 130.46%
• DSCR: 6.80
• 1% rule: 4.99%
• Cash to close: $18,200

Investor read

• This is a 2-bed/2.0-bath single-family listed at $65k. Condition is rated good.
• At list price, monthly cash flow is $2k ($24k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $65k).
• It's been on market 70 days — a 6% lower offer ($61k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $61k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $449 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#65 in FL, #1,123 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: crime D+, cost of living F.
• Monroe (town): math 50% / reading 55% proficiency, ranked #23 of 73 in FL (top 32%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+4.5%/yr); 496 active listings in the ZIP; solid renter incomes; 332 units permitted in Monroe County in 2024 (42 in 5+ unit buildings).
• Monroe County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (-3.0% appreciation + 4.5% rent growth), your $18k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 42.8% vs local median 0.8% in Key West — 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.
• This rent runs 45% of the median local income ($87k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 70 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• 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.
• 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?
• Crime grade is D 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?
• 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.