1226 Market St

Harrisburg, PA 17103

$265,000D+

4 bd · 2.0 ba · 1,848 sqft · Built 1910 · MultiFamily · Pending · 88 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,625/mo
• Mortgage (P&I): −$1,390
• Tax + insurance: −$468
• HOA: −$0
• Vac / Maint / Mgmt: −$551
• Net cashflow: $216/mo
• Annual: $2,595/yr
• Cap rate: 7.52%
• Cash-on-cash: 4.40%
• DSCR: 1.20
• 1% rule: 0.99%
• Cash to close: $74,200

Investor read

• This is a 2 × 2-bed/1-bath units multifamily listed at $265k.
• At list price, monthly cash flow is $216 ($3k/yr) — positive. Per door: $108/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $262k (0.9% below list).
• It's been on market 88 days — a 6% lower offer ($249k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $249k (6.0% 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 $8k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#107 in PA, #826 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: schools C-, employment D, crime F.
• Harrisburg City SD (urban): math 6% / reading 13% proficiency, ranked #535 of 539 in PA (top 99%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 82% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $56/mo; built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.1%/yr); 68 active listings in the ZIP; 29 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 540 units permitted in Dauphin County in 2024 (194 in 5+ unit buildings).
• 3 sale attempts since 3y 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.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $74k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; 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 6.2% in Harrisburg — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• At $2,625/mo this rent would consume 79% of the median local household income ($40k/yr) (locally 1014% 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 88 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 1910 — 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.
• Crime grade is F 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?