40 Reed St

Pittsfield, MA 01201

$1,150,000C+

3 bd · 3.0 ba · 1,870 sqft · Built 1900 · MultiFamily · Active · 80 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $17,708/mo
• Mortgage (P&I): −$6,031
• Tax + insurance: −$1,917
• HOA: −$0
• Vac / Maint / Mgmt: −$3,719
• Net cashflow: $6,042/mo
• Annual: $72,503/yr
• Cap rate: 12.60%
• Cash-on-cash: 22.52%
• DSCR: 2.00
• 1% rule: 1.54%
• Cash to close: $322,000

Investor read

• This is a 14 × 1-bed/1-bath units multifamily listed at $1.15M.
• At list price, monthly cash flow is $6k ($73k/yr) — positive. Per door: $432/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($18k rent vs $1.15M).
• It's been on market 80 days — a 6% lower offer ($1.08M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.08M (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $8k of loan paydown is wiped out by about $34k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#70 in MA, #3,820 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+, health & safety A+; Watch: employment C-, amenities D+, schools D.
• Pittsfield (urban): math 19% / reading 34% proficiency, ranked #272 of 302 in MA (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+7.7%/yr); 275 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 130 units permitted in Berkshire County in 2024 (10 in 5+ unit buildings).
• Berkshire County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 6 sale attempts since 12y ago; this cycle's ask has dropped $100k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 7.7% rent growth), your $322k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 12.6% vs local median 3.6% in Pittsfield — 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 $17,708/mo this rent would consume 299% of the median local household income ($71k/yr) (locally 1580% 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 80 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 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.
• 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?
• 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?