416 Walnut St #3

Newark, NJ 07105-2736

$850,000D

9 bd · 3.9 ba · — sqft · Built 1900 · MultiFamily · Active · 72 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,403/mo
• Mortgage (P&I): −$4,457
• Tax + insurance: −$1,417
• HOA: −$0
• Vac / Maint / Mgmt: −$1,555
• Net cashflow: $-26/mo
• Annual: $-309/yr
• Cap rate: 6.26%
• Cash-on-cash: -0.13%
• DSCR: 0.99
• 1% rule: 0.87%
• Cash to close: $238,000

Investor read

• This is a 3 × 3-bed/1.3-bath units multifamily listed at $850k. Condition is rated fair.
• At list price, monthly cash flow is $-26 ($-309/yr) — negative. Per door: $-9/mo.
• To cash-flow at today's rent, offer at most $846k (0.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $740k (12.9% below list).
• It's been on market 72 days — a 6% lower offer ($799k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $740k (12.9% below list) — sets the bar for 1% rule.
• In year one you build about $31k of equity ($6k loan paydown + $26k 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: housing D+, crime F, employment D-.
• 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.
• Zoned schools: Ann Street School (math 13% / reading 34%, grade F, #921 of 1,303 statewide, top 71%, 1,200 students, 78% FRL); East Side High School (math 17% / reading 22%, grade F, #357 of 399 statewide, top 90%, 2,255 students, 77% FRL) — zoned schools at 77% FRL track the district average.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 1 active listings in the ZIP; 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.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $238k cash investment doubles in ~7 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$51k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: 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 6.3% 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

• 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?
• It's been on market 72 days. Have you received any prior offers? Is the seller open to a 13% 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?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.

Repairs flagged (vision-AI assessment)

• Minor: kitchen cabinets — slight wear
• Minor: bathroom fixtures — slight wear
• Moderate: exterior siding — visible wear