Robert - Build on Your Lot Plan

Lewes, DE 19958

$304,990F

3 bd · 2.0 ba · 1,510 sqft · Built — · SingleFamily · Active · 763 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,312/mo
• Mortgage (P&I): −$2,949
• Tax + insurance: −$937
• HOA: −$0
• Vac / Maint / Mgmt: −$485
• Net cashflow: $-2,061/mo
• Annual: $-24,727/yr
• Cap rate: 1.90%
• Cash-on-cash: -15.70%
• DSCR: 0.30
• 1% rule: 0.41%
• Cash to close: $157,482

Investor read

• This is a 3-bed/2.0-bath single-family listed at $305k.
• At list price, monthly cash flow is $-2k ($-25k/yr) — negative.
• To cash-flow at today's rent, offer at most $264k (13.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $231k (24.2% below list).
• It's been on market 763 days — a 12% lower offer ($268k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $231k (24.2% 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 67/100 on livability (#40 in DE) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, health & safety A+; Watch: commute F, cost of living F.
• Cape Henlopen School District (town): math 42% / reading 55% proficiency, ranked #5 of 26 in DE (top 19%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: property tax is 2.8% of price.
• Market conditions: Rents flat; 818 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 69% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 4,354 units permitted in Sussex County in 2024 (344 in 5+ unit buildings).
• Sussex County population projected at +25% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 763 days. Have you received any prior offers? Is the seller open to a 24% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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 B-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?
• 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.