392 Elm St

Mechanic Falls, ME 04256

$215,000C-

3 bd · 1.0 ba · 1,040 sqft · Built — · MultiFamily · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,441/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$317
• HOA: −$0
• Vac / Maint / Mgmt: −$303
• Net cashflow: $-307/mo
• Annual: $-3,681/yr
• Cap rate: 4.58%
• Cash-on-cash: -6.11%
• DSCR: 0.73
• 1% rule: 0.67%
• Cash to close: $60,200

Investor read

• This is a 3-bed/1.0-bath multifamily listed at $215k.
• At list price, monthly cash flow is $-307 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $161k (25.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $144k (33.0% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $144k (33.0% below list) — sets the bar for 1% rule.
• In year one you build about $23k of equity ($1k loan paydown + $22k appreciation (10.0% local appreciation)).
• Location reads 69/100 on livability (#78 in ME) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D+, schools F, amenities F.
• RSU 16 (rural): math 79% / reading 83% proficiency, ranked #73 of 112 in ME (top 65%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Market conditions: 21 active listings in the ZIP; 358 units permitted in Androscoggin County in 2024 (57 in 5+ unit buildings).
• Androscoggin County population projected at -19% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• By year 2, paydown + projected appreciation supports a ~$37k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 4.6% vs local median 2.4% in Mechanic Falls — 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.

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 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?
• 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.