877 Arden Ave

Berea, OH 44017

$290,000B-

6 bd · 3.0 ba · 3,328 sqft · Built 1977 · MultiFamily · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,371/mo
• Mortgage (P&I): −$1,521
• Tax + insurance: −$584
• HOA: −$0
• Vac / Maint / Mgmt: −$708
• Net cashflow: $558/mo
• Annual: $6,701/yr
• Cap rate: 8.60%
• Cash-on-cash: 8.25%
• DSCR: 1.37
• 1% rule: 1.16%
• Cash to close: $81,200

Investor read

• This is a 2 × 3-bed/2.5-bath units multifamily listed at $290k.
• At list price, monthly cash flow is $558 ($7k/yr) — positive. Per door: $279/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $290k).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#136 in OH, #1,955 nationally) — a professional / high-income tenant draw. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities D, commute F.
• Berea City (suburban): math 47% / reading 56% proficiency, ranked #414 of 656 in OH (top 63%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 59 active listings in the ZIP; solid renter incomes; 1,441 units permitted in Cuyahoga County in 2024 (700 in 5+ unit buildings).
• Cuyahoga County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.6% vs local median 4.8% in Berea — 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 $3,371/mo this rent would consume 54% of the median local household income ($75k/yr) (locally 356% 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 1977 — 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 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.
• 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.