744 Lago Rd

Delray Beach, FL 33445

$264,000D-

2 bd · 2.0 ba · 1,440 sqft · Built 1981 · SingleFamily · Active · 56 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,355/mo
• Mortgage (P&I): −$1,384
• Tax + insurance: −$440
• HOA: −$777
• Vac / Maint / Mgmt: −$495
• Net cashflow: $-741/mo
• Annual: $-8,893/yr
• Cap rate: 2.92%
• Cash-on-cash: -12.03%
• DSCR: 0.46
• 1% rule: 0.89%
• Cash to close: $73,920

Investor read

• This is a 2-bed/2.0-bath single-family listed at $264k. Condition is rated fair.
• At list price, monthly cash flow is $-741 ($-9k/yr) — negative.
• To cash-flow at today's rent, offer at most $157k (40.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $235k (10.8% below list).
• It's been on market 56 days — a 3% lower offer ($256k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $157k (40.6% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#202 in FL, #3,160 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, commute A-; Watch: cost of living C-, crime D-, amenities F.
• Palm Beach (suburban): math 46% / reading 53% proficiency, ranked #34 of 73 in FL (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Orchard View Elementary School (math 48% / reading 47%, grade D, #1,182 of 2,144 statewide, top 55%, 596 students, 76% FRL); Carver Middle School (math 22% / reading 34%, grade F, #486 of 571 statewide, top 86%, 732 students, 73% FRL); Atlantic High School (math 28% / reading 52%, grade F, #296 of 667 statewide, top 45%, 1,889 students, 59% FRL) — zoned schools average 69% FRL vs 52% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: HOA is 33% of rent.
• Market conditions: Rents rising (+1.8%/yr); 508 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 84d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 85% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 3,974 units permitted in Palm Beach County in 2024 (1,012 in 5+ unit buildings).
• Palm Beach County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→27/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 2.9% vs local median 4.1% in Delray Beach — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 36% of the median local income ($78k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• It's been on market 56 days. Have you received any prior offers? Is the seller open to a 41% 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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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 D 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?
• 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?

Repairs flagged (vision-AI assessment)

• Minor: Paint — Faded paint in some areas.
• Minor: Landscaping — Some overgrown areas need trimming.