204 Academy Ave

Federalsburg, MD 21632

$21,000D+

2 bd · 1.0 ba · 1,024 sqft · Built 1895 · SingleFamily · Active · 370 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,607/mo
• Mortgage (P&I): −$110
• Tax + insurance: −$451
• HOA: −$0
• Vac / Maint / Mgmt: −$337
• Net cashflow: $708/mo
• Annual: $8,495/yr
• Cap rate: 71.12%
• Cash-on-cash: 231.52%
• DSCR: 11.30
• 1% rule: 7.65%
• Cash to close: $5,880

Investor read

• This is a 2-bed/1.0-bath single-family listed at $21k.
• At list price, monthly cash flow is $708 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $21k).
• It's been on market 370 days — a 12% lower offer ($18k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $18k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-2.2%/yr); year-one equity from $145 of loan paydown is wiped out by about $467 of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#266 in MD) — a middle-class / working-renter tenant base. Strengths: cost of living A+, crime A, health & safety A; Watch: housing C-, schools F, amenities F.
• Caroline County Public Schools (rural): math 13% / reading 29% proficiency, ranked #17 of 24 in MD (top 71%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: flood insurance adds $427/mo; built in 1895 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 46 active listings in the ZIP; 59 units permitted in Caroline County in 2024 (0 in 5+ unit buildings).
• Caroline County population projected at -19% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts since 12y ago; this cycle's ask has dropped $14k (40%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-2.2% appreciation + 3.0% rent growth), your $6k cash investment doubles in ~1 year — after that, you're playing with house money.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); major wind risk, 68% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 71.1% vs local median 4.8% in Federalsburg — 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

• It's been on market 370 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1895 — 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.
• 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.