25 West St

Lebanon, NH 03766

$495,000C+

5 bd · 3.0 ba · 1,960 sqft · Built 1880 · MultiFamily · Pending · 18 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,026/mo
• Mortgage (P&I): −$2,596
• Tax + insurance: −$945
• HOA: −$0
• Vac / Maint / Mgmt: −$1,475
• Net cashflow: $2,010/mo
• Annual: $24,121/yr
• Cap rate: 11.17%
• Cash-on-cash: 17.40%
• DSCR: 1.77
• 1% rule: 1.42%
• Cash to close: $138,600

Investor read

• This is a 5-bed/3.0-bath multifamily listed at $495k.
• At list price, monthly cash flow is $2k ($24k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $495k).
• It's been on market 18 days — a 2% lower offer ($488k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $488k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $15k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#59 in NH) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, crime A; Watch: health & safety D, amenities F, commute F.
• Lebanon School District (town): math 48% / reading 60% proficiency, ranked #26 of 98 in NH (top 26%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Hanover Street School (math 57% / reading 62%, grade B-, #42 of 263 statewide, top 19%, 328 students, 29% FRL).
• Watch-outs: built in 1880 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.6%/yr); 43 active listings in the ZIP; solid renter incomes; 487 units permitted in Grafton County in 2024 (127 in 5+ unit buildings).
• Grafton County population projected at -13% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 7 sale attempts since 20y 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 $368k; 35% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 6.6% rent growth), your $139k cash investment doubles in ~6 years — after that, you're playing with house money.
• Cap rate 11.2% vs local median 2.2% in Lebanon — 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 $7,026/mo this rent would consume 84% of the median local household income ($101k/yr) (locally 488% 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 1880 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.