2 Scull St

Newport, RI 02835

$1,250,000F

3 bd · 2.0 ba · 1,492 sqft · Built 1984 · SingleFamily · Pending · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,650/mo
• Mortgage (P&I): −$6,555
• Tax + insurance: −$920
• HOA: −$0
• Vac / Maint / Mgmt: −$556
• Net cashflow: $-5,381/mo
• Annual: $-64,577/yr
• Cap rate: 1.13%
• Cash-on-cash: -18.45%
• DSCR: 0.18
• 1% rule: 0.21%
• Cash to close: $350,000

Investor read

• This is a 3-bed/2.0-bath single-family listed at $1.25M.
• At list price, monthly cash flow is $-5k ($-65k/yr) — negative.
• To cash-flow at today's rent, offer at most $299k (76.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $265k (78.8% below list).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $265k (78.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $9k of loan paydown is wiped out by about $38k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#5 in RI, #2,367 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, health & safety A+; Watch: schools D-, cost of living F.
• Jamestown (suburban): math 51% / reading 68% proficiency, ranked #2 of 39 in RI (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 8% free/reduced lunch — higher-income household profile.
• Market conditions: 64 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 94 units permitted in Newport County in 2024 (0 in 5+ unit buildings).
• Newport County population projected at -12% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 13 sale attempts since 27y 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 $524k; list at $1.25M implies a 139% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 1.1% vs local median 2.1% in Newport — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.

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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.