327 E 25th Ave #205

North Wildwood, NJ 08260

$799,000D

3 bd · 2.0 ba · 1,412 sqft · Built 2016 · Condo · Under Contract · 19 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,606/mo
• Mortgage (P&I): −$4,190
• Tax + insurance: −$1,255
• HOA: −$0
• Vac / Maint / Mgmt: −$1,387
• Net cashflow: $-226/mo
• Annual: $-2,716/yr
• Cap rate: 6.59%
• Cash-on-cash: 1.07%
• DSCR: 1.05
• 1% rule: 0.83%
• Cash to close: $223,720

Investor read

• This is a 3-bed/2.0-bath condo listed at $799k.
• At list price, monthly cash flow is $-226 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $759k (5.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $661k (17.3% below list).
• It's been on market 19 days — a 2% lower offer ($787k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $661k (17.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $24k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#318 in NJ) — a middle-class / working-renter tenant base. Strengths: health & safety A+; Watch: amenities C-, crime D-, commute F.
• North Wildwood School District (suburban): math 55% / reading 45% proficiency, ranked #396 of 612 in NJ (top 65%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: 437 active listings in the ZIP; 3 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; 877 units permitted in Cape May County in 2024 (35 in 5+ unit buildings).
• Cape May County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 10y 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.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.6% vs local median 3.7% in North Wildwood — 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?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.
• 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.