136 Denny Ave

Penns Grove, NJ 08069

$200,000B-

4 bd · 1.5 ba · 1,783 sqft · Built 1920 · SingleFamily · Active · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,756/mo
• Mortgage (P&I): −$1,049
• Tax + insurance: −$619
• HOA: −$0
• Vac / Maint / Mgmt: −$579
• Net cashflow: $510/mo
• Annual: $6,118/yr
• Cap rate: 9.75%
• Cash-on-cash: 12.35%
• DSCR: 1.55
• 1% rule: 1.38%
• Cash to close: $56,000

Investor read

• This is a 4-bed/1.5-bath single-family listed at $200k.
• At list price, monthly cash flow is $510 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $200k).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 57/100 on livability (#519 in NJ) — a working-class tenant base; expect higher turnover. Strengths: cost of living A, housing A-; Watch: schools F, crime F, amenities F.
• Penns Grove-Carneys Point Regional School District (suburban): math 6% / reading 21% proficiency, ranked #462 of 472 in NJ (top 98%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 65% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 2.8% of price; flood insurance adds $66/mo; built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 101 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 95 units permitted in Salem County in 2024 (0 in 5+ unit buildings).
• Salem County population projected at -23% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts; this cycle's ask has dropped $50k (20%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $105k; list at $200k implies a 90% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $56k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.8% vs local median 6.0% in Penns Grove — 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 $2,756/mo this rent would consume 46% of the median local household income ($72k/yr) (locally 696% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?
• Crime grade is F 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?
• 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.