246 Sackett St

Providence, RI 02907

$439,000B

8 bd · 3.0 ba · 3,488 sqft · Built 1920 · MultiFamily · Pending · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,987/mo
• Mortgage (P&I): −$2,302
• Tax + insurance: −$545
• HOA: −$0
• Vac / Maint / Mgmt: −$1,467
• Net cashflow: $2,672/mo
• Annual: $32,066/yr
• Cap rate: 13.60%
• Cash-on-cash: 26.09%
• DSCR: 2.16
• 1% rule: 1.59%
• Cash to close: $122,920

Investor read

• This is a 3 × 3-bed/1.7-bath units multifamily listed at $439k.
• At list price, monthly cash flow is $3k ($32k/yr) — positive. Per door: $891/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $439k).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#2 in RI, #794 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+; Watch: employment C-, schools F.
• Providence (urban): math 8% / reading 16% proficiency, ranked #34 of 39 in RI (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+15.3%/yr); 61 active listings in the ZIP; 776 units permitted in Providence County in 2024 (229 in 5+ unit buildings).
• Providence County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 8y 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 $130k; list at $439k implies a 238% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $123k cash investment doubles in ~4 years — after that, you're playing with house money.
• Cap rate 13.6% vs local median 4.2% in Providence — 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 $6,987/mo this rent would consume 160% of the median local household income ($52k/yr) (locally 2189% 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 1920 — 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?
• 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.