5 N Main St

Wharton, NJ 07885-2219

$499,900B-

2 bd · 1.5 ba · 1,296 sqft · Built 1900 · MultiFamily · Active · 94 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,787/mo
• Mortgage (P&I): −$2,622
• Tax + insurance: −$833
• HOA: −$0
• Vac / Maint / Mgmt: −$1,215
• Net cashflow: $1,117/mo
• Annual: $13,404/yr
• Cap rate: 8.97%
• Cash-on-cash: 9.58%
• DSCR: 1.43
• 1% rule: 1.16%
• Cash to close: $139,972

Investor read

• This is a 2-bed/1.5-bath multifamily listed at $500k. Condition is rated good.
• At list price, monthly cash flow is $1k ($13k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $500k).
• It's been on market 94 days — a 9% lower offer ($455k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $455k (9.0% below list) — sets the bar for market timing.
• In year one you build about $18k of equity ($3k loan paydown + $15k appreciation (3.0% local appreciation)).
• Location reads 71/100 on livability (#245 in NJ) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute D-, cost of living F.
• Wharton Borough School District (suburban): math 22% / reading 43% proficiency, ranked #307 of 472 in NJ (top 65%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 1 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals leasing fast (median 0d on market — plan ~1-2 weeks tenant-placement turnaround); 2,357 units permitted in Morris County in 2024 (1,496 in 5+ unit buildings).
• Morris County population projected at +6% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 5y ago; this cycle's ask has dropped $30k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $339k; 47% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $140k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

Questions for listing agent

• It's been on market 94 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.