33 Pepperwood Ln

Bear, DE 19701

$299,000F

3 bd · 1.5 ba · 1,150 sqft · Built 1991 · Townhouse · Pending · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,277/mo
• Mortgage (P&I): −$1,568
• Tax + insurance: −$281
• HOA: −$8
• Vac / Maint / Mgmt: −$478
• Net cashflow: $-58/mo
• Annual: $-699/yr
• Cap rate: 6.06%
• Cash-on-cash: -0.83%
• DSCR: 0.96
• 1% rule: 0.76%
• Cash to close: $83,720

Investor read

• This is a 3-bed/1.5-bath townhouse listed at $299k.
• At list price, monthly cash flow is $-58 ($-699/yr) — negative.
• To cash-flow at today's rent, offer at most $289k (3.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $228k (23.9% below list).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $228k (23.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#8 in DE) — a middle-class / working-renter tenant base. Strengths: housing A+, employment A-, cost of living A-; Watch: crime C-, amenities F, commute F.
• Christina School District (suburban): math 22% / reading 33% proficiency, ranked #18 of 26 in DE (top 69%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Shue-Medill Middle School (math 21% / reading 30%, grade F, #21 of 36 statewide, top 57%, 808 students, 0% FRL); Christiana High School (math 49% / reading 66%, grade C, #3 of 40 statewide, top 5%, 1,256 students, 0% FRL) — zoned schools average 0% FRL vs 50% district-wide (50 pts lower); this property's tenant base skews higher-income than the district average.
• Zoned-school proficiency averages 42% at this address vs 28% district-wide (+14 pts) — the actual schools serving this property are materially stronger than the Christina School District average implies; a family-tenant draw the district grade alone would hide.
• Market conditions: Rents rising fast (+9.0%/yr); 111 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 1,367 units permitted in New Castle County in 2024 (201 in 5+ unit buildings).
• New Castle County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 3 sale attempts since 21y 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 $175k; list at $299k implies a 71% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: 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 6.1% vs local median 4.7% in Bear — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.