22 Elm St #401

Worcester, MA 01608

$235,500C

2 bd · 2.0 ba · 1,467 sqft · Built 2026 · Condo · Active · 88 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,327/mo
• Mortgage (P&I): −$1,235
• Tax + insurance: −$392
• HOA: −$353
• Vac / Maint / Mgmt: −$489
• Net cashflow: $-142/mo
• Annual: $-1,708/yr
• Cap rate: 5.57%
• Cash-on-cash: -2.59%
• DSCR: 0.88
• 1% rule: 0.99%
• Cash to close: $65,940

Investor read

• This is a 2-bed/2.0-bath condo listed at $236k. Condition is rated excellent.
• At list price, monthly cash flow is $-142 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $215k (8.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $233k (1.2% below list).
• It's been on market 88 days — a 6% lower offer ($221k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $215k (8.7% below list) — sets the bar for cash-flow.
• In year one you build about $7k of equity ($2k loan paydown + $5k appreciation (2.3% local appreciation)).
• Location reads 87/100 on livability (#9 in MA, #312 nationally) — a professional / high-income tenant draw. Strengths: crime A+, amenities A+, commute A+; Watch: cost of living D.
• Worcester (urban): math 17% / reading 30% proficiency, ranked #280 of 302 in MA (top 93%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Elm Park Community (math 4% / reading 24%, grade F, #881 of 938 statewide, top 94%, 415 students, 0% FRL); Forest Grove Middle (math 19% / reading 31%, grade F, #234 of 305 statewide, top 77%, 897 students, 0% FRL); Doherty Memorial High (math 37% / reading 47%, grade F, #214 of 343 statewide, top 65%, 1,344 students, 0% FRL) — zoned schools average 0% FRL vs 66% district-wide (66 pts lower); this property's tenant base skews higher-income than the district average.
• Market conditions: Rents rising fast (+7.8%/yr); 10 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 73d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,293 units permitted in Worcester County in 2024 (1,205 in 5+ unit buildings).
• By year 5, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 5.6% vs local median 4.1% in Worcester — 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 $2,327/mo this rent would consume 61% of the median local household income ($46k/yr) — 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 88 days. Have you received any prior offers? Is the seller open to a 9% 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?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.
• 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.