221 Sussex Ave

Newark, NJ 07103

$1,350,000C-

None bd · None ba · — sqft · Built — · MultiFamily · Active · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $13,654/mo
• Mortgage (P&I): −$7,080
• Tax + insurance: −$2,250
• HOA: −$0
• Vac / Maint / Mgmt: −$2,867
• Net cashflow: $1,457/mo
• Annual: $17,485/yr
• Cap rate: 7.59%
• Cash-on-cash: 4.63%
• DSCR: 1.21
• 1% rule: 1.01%
• Cash to close: $378,000

Investor read

• This is a multifamily listed at $1.35M. Condition is rated poor.
• At list price, monthly cash flow is $1k ($17k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($14k rent vs $1.35M).
• It's been on market 22 days — a 2% lower offer ($1.33M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.33M (1.5% below list) — sets the bar for market timing.
• In year one you build about $39k of equity ($9k loan paydown + $29k appreciation (2.2% local appreciation)).
• Location reads 67/100 on livability (#343 in NJ) — a middle-class / working-renter tenant base. Strengths: commute A+, amenities A-; Watch: schools D+, housing D+, crime F.
• Newark Public School District (urban): math 9% / reading 26% proficiency, ranked #452 of 472 in NJ (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents flat; 61 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 3,364 units permitted in Essex County in 2024 (2,551 in 5+ unit buildings).
• Essex County population projected at +3% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 3y 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.
• At projected returns (2.2% appreciation + 0.3% rent growth), your $378k cash investment doubles in ~7 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$98k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 7.6% vs local median 3.0% in Newark — 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.
• At $13,654/mo this rent would consume 318% of the median local household income ($52k/yr) (locally 2963% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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?
• 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)

• Major: roof — Severe rust and deterioration
• Major: exterior siding — Severe weathering
• Major: interior walls — No photos, but likely in poor condition