276 Ellison St

Paterson, NJ 07501

$1,248,800B-

None bd · None ba · — sqft · Built — · MultiFamily · Active · 170 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $15,310/mo
• Mortgage (P&I): −$6,549
• Tax + insurance: −$2,081
• HOA: −$0
• Vac / Maint / Mgmt: −$3,215
• Net cashflow: $3,465/mo
• Annual: $41,577/yr
• Cap rate: 9.62%
• Cash-on-cash: 11.89%
• DSCR: 1.53
• 1% rule: 1.23%
• Cash to close: $349,664

Investor read

• This is a 8 × 2-bed/?-bath units multifamily listed at $1.25M.
• At list price, monthly cash flow is $3k ($42k/yr) — positive. Per door: $433/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($15k rent vs $1.25M).
• It's been on market 170 days — a 12% lower offer ($1.10M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.10M (12.0% below list) — sets the bar for market timing.
• In year one you build about $21k of equity ($9k loan paydown + $13k appreciation (1.0% local appreciation)).
• Location reads 69/100 on livability (#293 in NJ) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, health & safety A; Watch: schools D, employment D, crime F.
• Paterson Public School District (suburban): math 6% / reading 26% proficiency, ranked #458 of 472 in NJ (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 83% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+11.4%/yr); 52 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 860 units permitted in Passaic County in 2024 (614 in 5+ unit buildings).
• Passaic County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 3 sale attempts since 10y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $95k; list at $1.25M implies a 1215% gain — meaningful room to come down on a strong offer.
• At projected returns (1.0% appreciation + 8.0% rent growth), your $350k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$77k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 9.6% vs local median 3.5% in Paterson — 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 $15,310/mo this rent would consume 415% of the median local household income ($44k/yr) (locally 3954% 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 170 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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?
• 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.