401 Undercliff Ave

Edgewater, NJ 07020

$2,099,000C-

None bd · None ba · — sqft · Built — · MultiFamily · Active · 135 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $17,996/mo
• Mortgage (P&I): −$11,007
• Tax + insurance: −$2,751
• HOA: −$0
• Vac / Maint / Mgmt: −$3,779
• Net cashflow: $458/mo
• Annual: $5,502/yr
• Cap rate: 6.56%
• Cash-on-cash: 0.94%
• DSCR: 1.04
• 1% rule: 0.86%
• Cash to close: $587,720

Investor read

• This is a 5 × 2-bed/?-bath units multifamily listed at $2.10M.
• At list price, monthly cash flow is $458 ($6k/yr) — positive. Per door: $92/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $1.80M (14.3% below list).
• It's been on market 135 days — a 12% lower offer ($1.85M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.80M (14.3% below list) — sets the bar for 1% rule.
• In year one you build about $164k of equity ($15k loan paydown + $150k appreciation (7.1% local appreciation)).
• Location reads 80/100 on livability (#74 in NJ, #1,774 nationally) — a professional / high-income tenant draw. Strengths: crime A+, amenities A+, employment A+; Watch: cost of living F.
• Edgewater School District (suburban): math 51% / reading 58% proficiency, ranked #276 of 612 in NJ (top 45%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 13% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising fast (+4.0%/yr); 90 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); high-income renter base; 3,488 units permitted in Bergen County in 2024 (1,610 in 5+ unit buildings).
• Bergen County population projected at +20% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 2y 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 (7.1% appreciation + 4.0% rent growth), your $588k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$262k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.6% vs local median 1.6% in Edgewater — 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 $17,996/mo this rent would consume 174% of the median local household income ($124k/yr) (locally 1039% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 135 days. Have you received any prior offers? Is the seller open to a 14% concession, seller financing, or rate buy-down credit?
• 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?
• 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 A-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.