205 Hawkins St

Derby, CT 06418

$625,000C+

6 bd · 3.0 ba · 3,881 sqft · Built 1925 · MultiFamily · Active · 50 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $9,491/mo
• Mortgage (P&I): −$3,278
• Tax + insurance: −$797
• HOA: −$0
• Vac / Maint / Mgmt: −$1,993
• Net cashflow: $3,423/mo
• Annual: $41,077/yr
• Cap rate: 12.87%
• Cash-on-cash: 23.47%
• DSCR: 2.04
• 1% rule: 1.52%
• Cash to close: $175,000

Investor read

• This is a 3 × 5-bed/3.0-bath units multifamily listed at $625k.
• At list price, monthly cash flow is $3k ($41k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($9k rent vs $625k).
• It's been on market 50 days — a 3% lower offer ($606k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $606k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $19k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#64 in CT, #4,574 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, cost of living B; Watch: crime D+, employment D+, amenities F.
• Derby School District (suburban): math 22% / reading 36% proficiency, ranked #127 of 153 in CT (top 83%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Derby High School (math 5% / reading 34%, grade F, #165 of 194 statewide, top 87%, 369 students, 51% FRL) — zoned schools at 51% FRL track the district average.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 39 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 502 units permitted in Naugatuck Valley Planning Region in 2024 (171 in 5+ unit buildings).
• 3 sale attempts since 26y 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 $360k; list at $625k implies a 73% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $175k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.9% vs local median 4.0% in Derby — 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 $9,491/mo this rent would consume 145% of the median local household income ($79k/yr) (locally 711% 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 50 days. Have you received any prior offers? Is the seller open to a 3% 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?
• Built in 1925 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 D 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.