1 Birchwood Dr

Fredonia, NY 14063

$549,900C+

18 bd · 9.0 ba · 7,312 sqft · Built 1964 · MultiFamily · Pending · 41 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,536/mo
• Mortgage (P&I): −$2,884
• Tax + insurance: −$916
• HOA: −$0
• Vac / Maint / Mgmt: −$1,373
• Net cashflow: $1,363/mo
• Annual: $16,358/yr
• Cap rate: 9.27%
• Cash-on-cash: 10.62%
• DSCR: 1.47
• 1% rule: 1.19%
• Cash to close: $153,972

Investor read

• This is a 2×2bd/1ba + 4×3bd/1.5ba units multifamily listed at $550k. Condition is rated fair.
• At list price, monthly cash flow is $1k ($16k/yr) — positive. Per door: $227/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $550k).
• It's been on market 41 days — a 3% lower offer ($533k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $533k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#95 in NY, #1,446 nationally) — a professional / high-income tenant draw. Strengths: housing A+, health & safety A+, commute A; Watch: amenities C-, employment C-, crime F.
• Fredonia Central School District (town): math 55% / reading 46% proficiency, ranked #376 of 590 in NY (top 64%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 92 active listings in the ZIP; 127 units permitted in Chautauqua County in 2024 (0 in 5+ unit buildings).
• Chautauqua County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 9.3% vs local median 3.3% in Fredonia — 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

• It's been on market 41 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• 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?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1964 — 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 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?
• Crime grade is F 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?

Repairs flagged (vision-AI assessment)

• Major: roof — Signs of wear and discoloration suggest significant damage and potential leaks.
• Major: siding — The siding is visibly worn and in need of repainting or replacement.
• Major: exterior flooring — The flooring is cracked and worn, indicating the need for repair or replacement.
• Major: interior walls/paint — The walls and paint show significant wear and discoloration, requiring repainting or replacement.
• Major: HVAC units — The units appear old and may need maintenance or replacement to ensure proper functioning.
• Major: landscaping — The landscaping is sparse and in need of maintenance to improve curb appeal and attract tenants.