701 Lexington Way

Morgantown, PA 19543

$209,995D

2 bd · 2.0 ba · 1,000 sqft · Built 1990 · Condo · Pending · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,100/mo
• Mortgage (P&I): −$1,101
• Tax + insurance: −$304
• HOA: −$390
• Vac / Maint / Mgmt: −$441
• Net cashflow: $-136/mo
• Annual: $-1,638/yr
• Cap rate: 5.51%
• Cash-on-cash: -2.79%
• DSCR: 0.88
• 1% rule: 1.00%
• Cash to close: $58,799

Investor read

• This is a 2-bed/2.0-bath condo listed at $210k.
• At list price, monthly cash flow is $-136 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $186k (11.5% below list).
• Meets the 1% rule at list price ($2k rent vs $210k).
• It's been on market 22 days — a 2% lower offer ($207k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $186k (11.5% below list) — sets the bar for cash-flow.
• Local home prices are declining (-1.5%/yr); year-one equity from $1k of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#879 in PA) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F.
• Twin Valley SD (rural): math 52% / reading 65% proficiency, ranked #72 of 539 in PA (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Twin Valley Ms (math 41% / reading 63%, grade C+, #103 of 512 statewide, top 21%, 920 students, 35% FRL); Twin Valley Hs (math 70% / reading 75%, grade B+, #37 of 437 statewide, top 8%, 1,023 students, 24% FRL).
• Market conditions: 17 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 258 units permitted in Berks County in 2024 (27 in 5+ unit buildings).
• Berks County population projected at +3% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 23y 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.
• Current owner paid $149k; 41% above their basis — modest negotiation headroom, anchor on the comps not their cost.

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 does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.