7 Forest Ave

Orono, ME 04473

$249,900C-

4 bd · 2.5 ba · 4,104 sqft · Built 1830 · SingleFamily · Pending · 264 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,596/mo
• Mortgage (P&I): −$1,311
• Tax + insurance: −$609
• HOA: −$0
• Vac / Maint / Mgmt: −$545
• Net cashflow: $131/mo
• Annual: $1,576/yr
• Cap rate: 6.92%
• Cash-on-cash: 2.25%
• DSCR: 1.10
• 1% rule: 1.04%
• Cash to close: $69,972

Investor read

• This is a 4-bed/2.5-bath single-family listed at $250k.
• At list price, monthly cash flow is $131 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $250k).
• It's been on market 264 days — a 12% lower offer ($220k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $220k (12.0% 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 $7k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#49 in ME) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, health & safety A+; Watch: amenities F, commute F, employment F.
• RSU 26 (suburban): math 88% / reading 90% proficiency, ranked #39 of 112 in ME (top 35%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1830 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 25 active listings in the ZIP; 440 units permitted in Penobscot County in 2024 (40 in 5+ unit buildings).
• Penobscot County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts; this cycle's ask has dropped $100k (29%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y — expect insurance premiums to compound above CPI over the hold.
• At $2,596/mo this rent would consume 51% of the median local household income ($62k/yr) (locally 423% 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 264 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1830 — 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 B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.