Gossamer - TR Plan

Emmaus, PA 18062

$474,900C-

3 bd · 2.5 ba · 2,144 sqft · Built — · MultiFamily · Active · 132 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,339/mo
• Mortgage (P&I): −$2,238
• Tax + insurance: −$711
• HOA: −$0
• Vac / Maint / Mgmt: −$911
• Net cashflow: $479/mo
• Annual: $5,747/yr
• Cap rate: 7.64%
• Cash-on-cash: 4.81%
• DSCR: 1.21
• 1% rule: 1.02%
• Cash to close: $119,479

Investor read

• This is a 3-bed/2.5-bath multifamily listed at $475k. Condition is rated excellent.
• At list price, monthly cash flow is $479 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $434k (8.6% below list).
• It's been on market 132 days — a 12% lower offer ($418k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $418k (12.0% 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 $13k of value loss. Plan a longer hold.
• Location reads 86/100 on livability (#61 in PA, #424 nationally) — a professional / high-income tenant draw. Strengths: crime A+, amenities A+, cost of living A+; Watch: commute F.
• East Penn SD (suburban): math 43% / reading 65% proficiency, ranked #103 of 539 in PA (top 19%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 17% free/reduced lunch — higher-income household profile.
• Market conditions: Rents flat; 162 active listings in the ZIP; 2 comparable units currently listed for rent nearby; high-income renter base; 765 units permitted in Lehigh County in 2024 (286 in 5+ unit buildings).
• Lehigh County population projected at +21% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 7.6% vs local median 3.3% in Emmaus — 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 $4,339/mo this rent would consume 47% of the median local household income ($111k/yr) (locally 537% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 132 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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 A-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.