45 Hedden Ter

Newark, NJ 07108-1707

$629,000D

15 bd · 12.0 ba · — sqft · Built 1907 · MultiFamily · Under Contract · 42 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,656/mo
• Mortgage (P&I): −$3,299
• Tax + insurance: −$1,048
• HOA: −$0
• Vac / Maint / Mgmt: −$1,188
• Net cashflow: $121/mo
• Annual: $1,456/yr
• Cap rate: 6.52%
• Cash-on-cash: 0.83%
• DSCR: 1.04
• 1% rule: 0.90%
• Cash to close: $176,120

Investor read

• This is a 2×1bd/1.0ba + 1×3bd/1.0ba units multifamily listed at $629k.
• At list price, monthly cash flow is $121 ($1k/yr) — positive. Per door: $40/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $566k (10.1% below list).
• It's been on market 42 days — a 3% lower offer ($610k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $566k (10.1% below list) — sets the bar for 1% rule.
• In year one you build about $23k of equity ($4k loan paydown + $19k appreciation (3.0% local appreciation)).
• Location reads 67/100 on livability (#343 in NJ) — a middle-class / working-renter tenant base. Strengths: commute A+, amenities A-; Watch: schools D+, housing D+, crime F.
• Newark Public School District (urban): math 9% / reading 26% proficiency, ranked #452 of 472 in NJ (top 96%) — 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.
• Watch-outs: built in 1907 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 1 active listings in the ZIP; 3,364 units permitted in Essex County in 2024 (2,551 in 5+ unit buildings).
• Essex County population projected at +3% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $176k cash investment doubles in ~6 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$38k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 6→13/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.5% vs local median 3.0% in Newark — 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.

Questions for listing agent

• It's been on market 42 days. Have you received any prior offers? Is the seller open to a 10% 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 1907 — 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 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?
• 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?