22278 Misty Woods Way

Watergate, FL 33428

$395,000D

3 bd · 2.0 ba · 1,200 sqft · Built 1985 · SingleFamily · Pending · 84 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,607/mo
• Mortgage (P&I): −$2,071
• Tax + insurance: −$560
• HOA: −$270
• Vac / Maint / Mgmt: −$758
• Net cashflow: $-52/mo
• Annual: $-619/yr
• Cap rate: 6.14%
• Cash-on-cash: -0.56%
• DSCR: 0.98
• 1% rule: 0.91%
• Cash to close: $110,600

Investor read

• This is a 3-bed/2.0-bath single-family listed at $395k.
• At list price, monthly cash flow is $-52 ($-619/yr) — negative.
• To cash-flow at today's rent, offer at most $386k (2.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $361k (8.7% below list).
• It's been on market 84 days — a 6% lower offer ($371k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $361k (8.7% 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 67/100 on livability (#585 in FL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: schools F, amenities F, commute 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.
• Market conditions: Rents rising (+3.7%/yr); 268 active listings in the ZIP; 23 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 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.
• 6 sale attempts since 11y ago; this cycle's ask is 13089% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $320k; 23% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• 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.
• At $3,607/mo this rent would consume 49% of the median local household income ($89k/yr) (locally 1990% 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 84 days. Have you received any prior offers? Is the seller open to a 9% 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 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?
• 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.