92 Forest Cove Rd #92

Hilton Head Island, SC 29928

$265,500C

2 bd · 2.0 ba · 1,000 sqft · Built 1988 · Condo · Pending · 401 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,667/mo
• Mortgage (P&I): −$1,392
• Tax + insurance: −$389
• HOA: −$0
• Vac / Maint / Mgmt: −$560
• Net cashflow: $326/mo
• Annual: $3,913/yr
• Cap rate: 7.77%
• Cash-on-cash: 5.26%
• DSCR: 1.23
• 1% rule: 1.00%
• Cash to close: $74,340

Investor read

• This is a 2-bed/2.0-bath condo listed at $266k.
• At list price, monthly cash flow is $326 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $266k).
• It's been on market 401 days — a 12% lower offer ($234k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $234k (12.0% below list) — sets the bar for market timing.
• In year one you build about $10k of equity ($2k loan paydown + $9k appreciation (3.2% local appreciation)).
• Location reads 64/100 on livability (#157 in SC) — a middle-class / working-renter tenant base. Strengths: employment A+, crime A-; Watch: amenities F, commute F, cost of living F.
• Beaufort 01 (town): math 42% / reading 51% proficiency, ranked #17 of 80 in SC (top 21%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+3.2%/yr); 845 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 1,824 units permitted in Beaufort County in 2024 (618 in 5+ unit buildings).
• Beaufort County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 6 sale attempts since 22y ago; this cycle's ask has dropped $34k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $190k; 40% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (3.2% appreciation + 3.2% rent growth), your $74k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 7.8% vs local median 2.9% in Hilton Head Island — 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 33% of the median local income ($98k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 401 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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?
• 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.
• 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?
• 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.