40 Duxbury Rd

Worcester, MA 01605

$389,000D

4 bd · 2.0 ba · 2,056 sqft · Built 1890 · SingleFamily · Active · 57 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,014/mo
• Mortgage (P&I): −$2,040
• Tax + insurance: −$500
• HOA: −$0
• Vac / Maint / Mgmt: −$633
• Net cashflow: $-159/mo
• Annual: $-1,905/yr
• Cap rate: 5.80%
• Cash-on-cash: -1.75%
• DSCR: 0.92
• 1% rule: 0.77%
• Cash to close: $108,920

Investor read

• This is a 4-bed/2.0-bath single-family listed at $389k.
• At list price, monthly cash flow is $-159 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $361k (7.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $301k (22.5% below list).
• It's been on market 57 days — a 3% lower offer ($377k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $301k (22.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 87/100 on livability (#9 in MA, #312 nationally) — a professional / high-income tenant draw. Strengths: crime A+, amenities A+, commute A+; Watch: schools C-, cost of living D.
• Worcester (urban): math 17% / reading 30% proficiency, ranked #280 of 302 in MA (top 93%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1890 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.8%/yr); 35 active listings in the ZIP; 17 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 2,293 units permitted in Worcester County in 2024 (1,205 in 5+ unit buildings).
• 4 sale attempts since 8y ago; this cycle's ask has dropped $36k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $325k; 20% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: moderate flood risk; major wind risk, 27% chance of damaging wind over 30y — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.8% vs local median 4.1% in Worcester — 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 $3,014/mo this rent would consume 66% of the median local household income ($55k/yr) (locally 1991% 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 57 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• Built in 1890 — 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.
• 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.