505 5th St

Niagara Falls, NY 14301

$120,000A-

12 bd · 9.0 ba · 3,090 sqft · Built 1921 · MultiFamily · Pending · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,195/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$200
• HOA: −$0
• Vac / Maint / Mgmt: −$881
• Net cashflow: $2,485/mo
• Annual: $29,817/yr
• Cap rate: 31.14%
• Cash-on-cash: 88.74%
• DSCR: 4.95
• 1% rule: 3.50%
• Cash to close: $33,600

Investor read

• This is a 3 × 4-bed/3.0-bath units multifamily listed at $120k.
• At list price, monthly cash flow is $2k ($30k/yr) — positive. Per door: $828/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $120k).
• It's been on market 25 days — a 2% lower offer ($118k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $118k (1.5% below list) — sets the bar for market timing.
• In year one you build about $13k of equity ($830 loan paydown + $12k appreciation (10.0% local appreciation)).
• Location reads 60/100 on livability (#956 in NY) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools F, crime F, amenities F.
• Niagara Falls City School District (urban): math 26% / reading 34% proficiency, ranked #578 of 590 in NY (top 98%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1921 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+8.8%/yr); 164 active listings in the ZIP; lower-income renter base — watch delinquency; 167 units permitted in Niagara County in 2024 (0 in 5+ unit buildings).
• Niagara County population projected at -19% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $46k; list at $120k implies a 158% gain — meaningful room to come down on a strong offer.
• At projected returns (10.0% appreciation + 8.0% rent growth), your $34k cash investment doubles in ~1 year — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 31.1% vs local median 7.5% in Niagara Falls — 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 $4,195/mo this rent would consume 146% of the median local household income ($35k/yr) (locally 954% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1921 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-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.