565 River Rd

Delaware Water Gap, PA 18301

$185,000B

6 bd · 2.0 ba · 2,250 sqft · Built 1902 · MultiFamily · Pending · 95 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,597/mo
• Mortgage (P&I): −$970
• Tax + insurance: −$375
• HOA: −$0
• Vac / Maint / Mgmt: −$965
• Net cashflow: $2,287/mo
• Annual: $27,440/yr
• Cap rate: 21.56%
• Cash-on-cash: 54.51%
• DSCR: 3.43
• 1% rule: 2.48%
• Cash to close: $51,800

Investor read

• This is a 6-bed/2.0-bath multifamily listed at $185k. Condition is rated fair.
• At list price, monthly cash flow is $2k ($27k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $185k).
• It's been on market 95 days — a 9% lower offer ($168k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $168k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#585 in PA) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, cost of living A+; Watch: health & safety D, amenities F, commute F.
• East Stroudsburg Area SD (rural): math 25% / reading 43% proficiency, ranked #413 of 539 in PA (top 77%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $66/mo; built in 1902 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+10.4%/yr); 196 active listings in the ZIP; solid renter incomes; 278 units permitted in Monroe County in 2024 (52 in 5+ unit buildings).
• Monroe County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts since 6y ago; this cycle's ask has dropped $15k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $52k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• At $4,597/mo this rent would consume 61% of the median local household income ($91k/yr) (locally 672% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 95 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1902 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.

Repairs flagged (vision-AI assessment)

• Major: Kitchen — No photos of kitchen
• Major: Bathroom — Outdated fixtures and yellow walls
• Major: Flooring — Worn hardwood floors
• Major: Paint — Painted walls in various colors, some peeling