3 Hills Ln #3

Norwalk, CT 06880

$525,000B

3 bd · 2.0 ba · 1,386 sqft · Built 1974 · Condo · Under Contract · 37 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $8,401/mo
• Mortgage (P&I): −$2,753
• Tax + insurance: −$875
• HOA: −$330
• Vac / Maint / Mgmt: −$1,764
• Net cashflow: $2,679/mo
• Annual: $32,146/yr
• Cap rate: 12.42%
• Cash-on-cash: 21.87%
• DSCR: 1.97
• 1% rule: 1.60%
• Cash to close: $147,000

Investor read

• This is a 3-bed/2.0-bath condo listed at $525k. Condition is rated good.
• At list price, monthly cash flow is $3k ($32k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $525k).
• It's been on market 37 days — a 3% lower offer ($509k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $509k (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 77/100 on livability (#41 in CT, #2,966 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, health & safety A+, crime A; Watch: amenities C-, cost of living F.
• Norwalk School District (urban): math 29% / reading 44% proficiency, ranked #104 of 153 in CT (top 68%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Wolfpit Integrated Arts Elementary School (math 32% / reading 47%, grade F, #298 of 553 statewide, top 56%, 361 students, 37% FRL); Nathan Hale Middle School (math 29% / reading 45%, grade F, #116 of 175 statewide, top 67%, 545 students, 54% FRL); Norwalk High School (math 33% / reading 58%, grade D-, #93 of 194 statewide, top 48%, 1,484 students, 51% FRL).
• Market conditions: Rents rising fast (+5.6%/yr); 196 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 1,151 units permitted in Western Connecticut Planning Region in 2024 (714 in 5+ unit buildings).
• 4 sale attempts since 26y ago; this cycle's ask has dropped $74k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $280k; list at $525k implies a 88% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 5.6% rent growth), your $147k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 12.4% vs local median 3.4% in Norwalk — 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.
• This rent runs 40% of the median local income ($250k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 37 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1974 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.
• How much new apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.

Repairs flagged (vision-AI assessment)

• Minor: Kitchen cabinets — Wear and tear visible on cabinet fronts.
• Minor: Kitchen countertops — Signs of wear and tear visible on countertops.