1258 Mill Lake Quarter

Chesapeake, VA 23320

$299,700D+

3 bd · 2.0 ba · 1,301 sqft · Built 1984 · Townhouse · Under Contract · 40 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,336/mo
• Mortgage (P&I): −$1,572
• Tax + insurance: −$347
• HOA: −$31
• Vac / Maint / Mgmt: −$491
• Net cashflow: $-104/mo
• Annual: $-1,251/yr
• Cap rate: 5.88%
• Cash-on-cash: -1.49%
• DSCR: 0.93
• 1% rule: 0.78%
• Cash to close: $83,916

Investor read

• This is a 3-bed/2.0-bath townhouse listed at $300k.
• At list price, monthly cash flow is $-104 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $281k (6.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $234k (22.0% below list).
• It's been on market 40 days — a 3% lower offer ($291k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $234k (22.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#236 in VA) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+; Watch: crime C-, cost of living C-, amenities F.
• Chesapeake City Public School District (suburban): math 58% / reading 74% proficiency, ranked #31 of 131 in VA (top 24%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Greenbrier Primary (676 students, 38% FRL); Greenbrier Middle (math 48% / reading 70%, grade B, #166 of 342 statewide, top 50%, 827 students, 42% FRL); Indian River High (math 69% / reading 73%, grade B+, #146 of 319 statewide, top 47%, 1,701 students, 71% FRL) — zoned schools average 51% FRL vs 28% district-wide (23 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+7.8%/yr); 286 active listings in the ZIP; 27 comparable units currently listed for rent nearby; rentals leasing fast (median 13d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 597 units permitted in Chesapeake city in 2024 (0 in 5+ unit buildings).
• Chesapeake County population projected at +21% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 11y 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 $132k; list at $300k implies a 126% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 80% 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 5.9% vs local median 3.7% in Chesapeake — 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 33% of the median local income ($84k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 40 days. Have you received any prior offers? Is the seller open to a 22% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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?
• 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?
• This sits on a lake — are riparian / water-frontage rights deeded with the parcel? Any dock permits, shoreline easements, or HOA water-use restrictions?
• What's the documented flood / surge / shoreline-erosion history here (FEMA AND non-FEMA — e.g., storm surge, creek backup, septic-field saturation)?