7205 New Jersey Ave #3

Wildwood Crest, NJ 08260-3843

$1,225,000C

3 bd · 2.0 ba · 1,503 sqft · Built 2002 · Condo · Active · 32 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $12,000/mo
• Mortgage (P&I): −$6,424
• Tax + insurance: −$1,547
• HOA: −$0
• Vac / Maint / Mgmt: −$2,520
• Net cashflow: $1,509/mo
• Annual: $18,108/yr
• Cap rate: 8.19%
• Cash-on-cash: 6.77%
• DSCR: 1.30
• 1% rule: 0.98%
• Cash to close: $343,000

Investor read

• This is a 3-bed/2.0-bath condo listed at $1.23M.
• At list price, monthly cash flow is $2k ($18k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $1.20M (2.0% below list).
• It's been on market 32 days — a 3% lower offer ($1.19M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.19M (3.0% below list) — sets the bar for market timing.
• In year one you build about $45k of equity ($8k loan paydown + $37k appreciation (3.0% local appreciation)).
• Location reads 70/100 on livability (#257 in NJ) — a middle-class / working-renter tenant base. Strengths: health & safety A+; Watch: amenities C-, commute F, cost of living F.
• Wildwood Crest Borough School District (suburban): math 35% / reading 45% proficiency, ranked #493 of 612 in NJ (top 81%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: 1 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 877 units permitted in Cape May County in 2024 (35 in 5+ unit buildings).
• Cape May County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts 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 $638k; list at $1.23M implies a 92% gain — meaningful room to come down on a strong offer.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $343k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$74k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.2% vs local median 2.7% in Wildwood Crest — 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

• It's been on market 32 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.