172 Baker St

Providence, RI 02905

$672,000D-

8 bd · 4.0 ba · 2,552 sqft · Built 2022 · MultiFamily · Active · 8 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,267/mo
• Mortgage (P&I): −$3,524
• Tax + insurance: −$682
• HOA: −$0
• Vac / Maint / Mgmt: −$1,106
• Net cashflow: $-45/mo
• Annual: $-540/yr
• Cap rate: 6.21%
• Cash-on-cash: -0.29%
• DSCR: 0.99
• 1% rule: 0.78%
• Cash to close: $188,160

Investor read

• This is a 2 × 4-bed/4.0-bath units multifamily listed at $672k.
• At list price, monthly cash flow is $-45 ($-540/yr) — negative. Per door: $-23/mo.
• To cash-flow at today's rent, offer at most $664k (1.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $527k (21.6% below list).
• Only 8 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $527k (21.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $20k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#2 in RI, #794 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+; Watch: employment C-, schools F.
• Providence (urban): math 8% / reading 16% proficiency, ranked #34 of 39 in RI (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising (+3.5%/yr); 75 active listings in the ZIP; 776 units permitted in Providence County in 2024 (229 in 5+ unit buildings).
• Providence County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Cap rate 6.2% vs local median 4.2% in Providence — 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 $5,267/mo this rent would consume 100% of the median local household income ($63k/yr) (locally 1220% 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?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• 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.
• 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.