9 11 Southern St

Cranston, RI 02920

$565,000F

4 bd · 2.0 ba · 1,956 sqft · Built 1920 · MultiFamily · Pending · 161 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,955/mo
• Mortgage (P&I): −$2,963
• Tax + insurance: −$642
• HOA: −$0
• Vac / Maint / Mgmt: −$831
• Net cashflow: $-480/mo
• Annual: $-5,763/yr
• Cap rate: 5.27%
• Cash-on-cash: -3.64%
• DSCR: 0.84
• 1% rule: 0.70%
• Cash to close: $158,200

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $565k.
• At list price, monthly cash flow is $-480 ($-6k/yr) — negative. Per door: $-240/mo.
• To cash-flow at today's rent, offer at most $480k (15.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $396k (30.0% below list).
• It's been on market 161 days — a 12% lower offer ($497k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $396k (30.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $17k of value loss. Plan a longer hold.
• Location reads 87/100 on livability (#1 in RI, #323 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, housing A+.
• Cranston (suburban): math 16% / reading 35% proficiency, ranked #23 of 39 in RI (top 59%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: George J. Peters School (math 12% / reading 32%, grade F, #106 of 167 statewide, top 66%, 273 students, 52% FRL); Hugh B. Bain Middle School (math 6% / reading 12%, grade F, #46 of 57 statewide, top 80%, 561 students, 68% FRL); Cranston High School West (math 31% / reading 58%, grade F, #17 of 58 statewide, top 33%, 1,715 students, 28% FRL) — zoned schools average 49% FRL vs 33% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.4%/yr); 127 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 60% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 776 units permitted in Providence County in 2024 (229 in 5+ unit buildings).
• Providence County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 2y 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: major wind risk, 71% 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 5.3% vs local median 3.2% in Cranston — 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 $3,955/mo this rent would consume 59% of the median local household income ($81k/yr) (locally 985% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• It's been on market 161 days. Have you received any prior offers? Is the seller open to a 30% 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 1920 — 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.
• 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?