3325 SW Sunset Trace Cir

Palm City, FL 34990

$240,000D

2 bd · 2.5 ba · 1,374 sqft · Built 1988 · Townhouse · Active · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,443/mo
• Mortgage (P&I): −$1,259
• Tax + insurance: −$204
• HOA: −$640
• Vac / Maint / Mgmt: −$513
• Net cashflow: $-173/mo
• Annual: $-2,081/yr
• Cap rate: 5.43%
• Cash-on-cash: -3.10%
• DSCR: 0.86
• 1% rule: 1.02%
• Cash to close: $67,200

Investor read

• This is a 2-bed/2.5-bath townhouse listed at $240k.
• At list price, monthly cash flow is $-173 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $209k (12.8% below list).
• Meets the 1% rule at list price ($2k rent vs $240k).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $209k (12.8% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#140 in FL, #2,113 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F, cost of living F.
• Martin (suburban): math 52% / reading 53% proficiency, ranked #24 of 73 in FL (top 33%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Citrus Grove Elementary (math 69% / reading 69%, grade A-, #399 of 2,144 statewide, top 19%, 600 students, 25% FRL); Hidden Oaks Middle School (math 82% / reading 71%, grade A, #33 of 571 statewide, top 6%, 940 students, 23% FRL) — zoned schools average 24% FRL vs 41% district-wide (17 pts lower); this property's tenant base skews higher-income than the district average.
• Zoned-school proficiency averages 73% at this address vs 52% district-wide (+20 pts) — the actual schools serving this property are materially stronger than the Martin average implies; a family-tenant draw the district grade alone would hide.
• Watch-outs: HOA is 26% of rent.
• Market conditions: Rents soft (-0.1%/yr); 452 active listings in the ZIP; 13 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 737 units permitted in Martin County in 2024 (167 in 5+ unit buildings).
• Martin County population projected at +19% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 26y 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 $138k; list at $240k implies a 74% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.4% vs local median 2.6% in Palm City — 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.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.
• 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 for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.