253 Waterman Ave

Providence, RI 02917

$399,999D+

4 bd · 2.0 ba · 1,879 sqft · Built 1920 · MultiFamily · Pending · 21 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,351/mo
• Mortgage (P&I): −$2,098
• Tax + insurance: −$540
• HOA: −$0
• Vac / Maint / Mgmt: −$704
• Net cashflow: $10/mo
• Annual: $116/yr
• Cap rate: 6.32%
• Cash-on-cash: 0.10%
• DSCR: 1.00
• 1% rule: 0.84%
• Cash to close: $112,000

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $400k.
• At list price, monthly cash flow is $10 ($116/yr) — positive. Per door: $5/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $335k (16.2% below list).
• It's been on market 21 days — a 2% lower offer ($394k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $335k (16.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#2 in RI, #794 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+; Watch: employment C-, schools F.
• Smithfield (suburban): math 37% / reading 55% proficiency, ranked #10 of 39 in RI (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; only 11% free/reduced lunch — higher-income household profile.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 72 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 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.
• 3 sale attempts since 28y 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 $118k; list at $400k implies a 239% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 68% 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 6.3% vs local median 4.2% in Providence — 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.

Questions for listing agent

• 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.
• 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.