446 Colchester Ave

Burlington, VT 05401

$389,900C

5 bd · 2.5 ba · 1,765 sqft · Built 1900 · SingleFamily · Active · 93 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,880/mo
• Mortgage (P&I): −$2,045
• Tax + insurance: −$632
• HOA: −$0
• Vac / Maint / Mgmt: −$815
• Net cashflow: $389/mo
• Annual: $4,667/yr
• Cap rate: 7.49%
• Cash-on-cash: 4.27%
• DSCR: 1.19
• 1% rule: 1.00%
• Cash to close: $109,172

Investor read

• This is a 5-bed/2.5-bath single-family listed at $390k.
• At list price, monthly cash flow is $389 ($5k/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 $388k (0.5% below list).
• It's been on market 93 days — a 9% lower offer ($355k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $355k (9.0% 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 $12k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#19 in VT, #4,619 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, health & safety A+, employment B; Watch: cost of living D, crime F, amenities F.
• Zoned schools: Edmunds Elementary School (math 42% / reading 57%, grade D, #50 of 192 statewide, top 32%, 228 students, 53% FRL); Lyman C. Hunt Middle School (math 34% / reading 47%, grade F, #13 of 26 statewide, top 52%, 337 students, 49% FRL); Burlington High School (math 42% / reading 57%, grade D, #8 of 48 statewide, top 15%, 987 students, 48% FRL).
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 138 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent; 898 units permitted in Chittenden County in 2024 (554 in 5+ unit buildings).
• Chittenden County population projected at +8% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 21y ago; this cycle's ask has dropped $70k (15%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $280k; 39% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 7.5% vs local median 3.0% in Burlington — 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 $3,880/mo this rent would consume 71% of the median local household income ($66k/yr) (locally 2757% 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 93 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.
• Schools are B-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?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.