3204 Roanoke Ave

Newport News, VA 23607

$255,000F

3 bd · 2.0 ba · 1,696 sqft · Built 1950 · SingleFamily · Under Contract · 47 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,903/mo
• Mortgage (P&I): −$1,337
• Tax + insurance: −$297
• HOA: −$0
• Vac / Maint / Mgmt: −$400
• Net cashflow: $-131/mo
• Annual: $-1,570/yr
• Cap rate: 5.68%
• Cash-on-cash: -2.20%
• DSCR: 0.90
• 1% rule: 0.75%
• Cash to close: $71,400

Investor read

• This is a 3-bed/2.0-bath single-family listed at $255k.
• At list price, monthly cash flow is $-131 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $232k (9.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $190k (25.4% below list).
• It's been on market 47 days — a 3% lower offer ($247k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $190k (25.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-0.8%/yr); year-one equity from $2k of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#123 in VA, #4,018 nationally) — a middle-class / working-renter tenant base. Strengths: health & safety A+, cost of living A, housing A; Watch: crime F, commute F.
• Newport News City Public School District (urban): math 34% / reading 54% proficiency, ranked #112 of 131 in VA (top 86%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: L.F. Palmer Elementary (math 24% / reading 42%, grade F, #986 of 1,108 statewide, top 89%, 433 students, 89% FRL); Heritage High (math 49% / reading 67%, grade C, #262 of 319 statewide, top 82%, 1,111 students, 85% FRL) — zoned schools average 87% FRL vs 55% district-wide (32 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.9%/yr); 130 active listings in the ZIP; 27 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 48% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 522 units permitted in Newport News city in 2024 (458 in 5+ unit buildings).
• Newport News County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 6 sale attempts since 10y 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.
• Current owner paid $190k; 34% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: moderate flood risk; severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 4.2% in Newport News — 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 $1,903/mo this rent would consume 54% of the median local household income ($42k/yr) (locally 2008% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 47 days. Have you received any prior offers? Is the seller open to a 25% concession, seller financing, or rate buy-down credit?
• Built in 1950 — 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 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 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?
• 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?
• 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.