42 Forrest Ave

Rumson, NJ 07760

$2,149,000F

4 bd · 3.5 ba · 2,847 sqft · Built 2010 · SingleFamily · Pending · 8 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $10,118/mo
• Mortgage (P&I): −$11,270
• Tax + insurance: −$2,553
• HOA: −$0
• Vac / Maint / Mgmt: −$2,125
• Net cashflow: $-5,829/mo
• Annual: $-69,950/yr
• Cap rate: 3.04%
• Cash-on-cash: -11.63%
• DSCR: 0.48
• 1% rule: 0.47%
• Cash to close: $601,720

Investor read

• This is a 4-bed/3.5-bath single-family listed at $2.15M.
• At list price, monthly cash flow is $-6k ($-70k/yr) — negative.
• To cash-flow at today's rent, offer at most $1.12M (47.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $1.01M (52.9% below list).
• Only 8 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $1.01M (52.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $15k of loan paydown is wiped out by about $64k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#326 in NJ) — a middle-class / working-renter tenant base. Strengths: schools A+, crime A+, employment A+; Watch: amenities F, commute F, cost of living F.
• Rumson-Fair Haven Regional High School District (suburban): math 64% / reading 75% proficiency, ranked #82 of 612 in NJ (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 81 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 17d on market — plan ~3-4 weeks tenant-placement turnaround); 2,840 units permitted in Monmouth County in 2024 (484 in 5+ unit buildings).
• Monmouth County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts since 17y 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 $1.70M; 26% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→17/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?
• 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?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.