1002 E Heritage Club Cir

Delray Beach, FL 33483

$820,000D

3 bd · 3.5 ba · 2,229 sqft · Built 2005 · Townhouse · Active · 135 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,463/mo
• Mortgage (P&I): −$4,300
• Tax + insurance: −$1,062
• HOA: −$679
• Vac / Maint / Mgmt: −$1,567
• Net cashflow: $-146/mo
• Annual: $-1,749/yr
• Cap rate: 6.08%
• Cash-on-cash: -0.76%
• DSCR: 0.97
• 1% rule: 0.91%
• Cash to close: $229,600

Investor read

• This is a 3-bed/3.5-bath townhouse listed at $820k.
• At list price, monthly cash flow is $-146 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $794k (3.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $746k (9.0% below list).
• It's been on market 135 days — a 12% lower offer ($722k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $722k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $25k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#202 in FL, #3,160 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, commute A-; Watch: cost of living C-, crime D-, amenities F.
• Palm Beach (suburban): math 46% / reading 53% proficiency, ranked #34 of 73 in FL (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Pine Grove Elementary School (math 42% / reading 47%, grade F, #1,288 of 2,144 statewide, top 62%, 354 students, 79% FRL); Boca Raton Community Middle School (math 59% / reading 61%, grade B, #135 of 571 statewide, top 24%, 1,225 students, 41% FRL); West Boca Raton High School (math 55% / reading 70%, grade B-, #93 of 667 statewide, top 14%, 2,271 students, 28% FRL) — zoned schools at 49% FRL track the district average.
• Market conditions: Rents rising fast (+6.9%/yr); 307 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; 3,974 units permitted in Palm Beach County in 2024 (1,012 in 5+ unit buildings).
• Palm Beach County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 9y ago; this cycle's ask has dropped $59k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $460k; list at $820k implies a 78% 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→27/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 4.4% in Delray Beach — 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 $7,463/mo this rent would consume 77% of the median local household income ($116k/yr) (locally 561% 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 135 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 B-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?
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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?