526 Cherry St

Norristown, PA 19401

$189,900B

4 bd · 1.0 ba · 1,515 sqft · Built 1900 · Townhouse · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,385/mo
• Mortgage (P&I): −$996
• Tax + insurance: −$273
• HOA: −$0
• Vac / Maint / Mgmt: −$501
• Net cashflow: $615/mo
• Annual: $7,386/yr
• Cap rate: 10.18%
• Cash-on-cash: 13.89%
• DSCR: 1.62
• 1% rule: 1.26%
• Cash to close: $53,172

Investor read

• This is a 4-bed/1.0-bath townhouse listed at $190k.
• At list price, monthly cash flow is $615 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $190k).
• It's been on market 23 days — a 2% lower offer ($187k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $187k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#100 in PA, #720 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime D-.
• Norristown Area SD (suburban): math 18% / reading 31% proficiency, ranked #466 of 539 in PA (top 86%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 70% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Gotwals El Sch (math 12% / reading 17%, grade F, #1,346 of 1,518 statewide, top 89%, 377 students, 100% FRL); Eisenhower Ms (math 7% / reading 31%, grade F, #447 of 512 statewide, top 88%, 812 students, 100% FRL); Norristown Area Hs (math 42% / reading 8%, grade F, #375 of 437 statewide, top 86%, 2,309 students, 83% FRL) — zoned schools average 94% FRL vs 70% district-wide (25 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.3%/yr); 166 active listings in the ZIP; 32 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 1,936 units permitted in Montgomery County in 2024 (530 in 5+ unit buildings).
• Montgomery County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 30y 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 $18k; list at $190k implies a 985% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.2% vs local median 4.2% in Norristown — 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.
• This rent runs 41% of the median local income ($70k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.