3726 Sugar Creek Cir

Portsmouth, VA 23703

$154,954D+

2 bd · 1.5 ba · 915 sqft · Built 1983 · Townhouse · Active · 145 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,559/mo
• Mortgage (P&I): −$813
• Tax + insurance: −$225
• HOA: −$25
• Vac / Maint / Mgmt: −$327
• Net cashflow: $169/mo
• Annual: $2,030/yr
• Cap rate: 7.60%
• Cash-on-cash: 4.68%
• DSCR: 1.21
• 1% rule: 1.01%
• Cash to close: $43,387

Investor read

• This is a 2-bed/1.5-bath townhouse listed at $155k.
• At list price, monthly cash flow is $169 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $155k).
• It's been on market 145 days — a 12% lower offer ($136k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $136k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#172 in VA) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: employment C-, crime F, commute F.
• Portsmouth City Public School District (urban): math 34% / reading 58% proficiency, ranked #107 of 131 in VA (top 82%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Churchland Academy Elementary (math 27% / reading 52%, grade F, #900 of 1,108 statewide, top 83%, 585 students, 118% FRL); Churchland Middle (math 53% / reading 77%, grade A-, #120 of 342 statewide, top 35%, 890 students, 100% FRL); Churchland High (math 48% / reading 80%, grade B-, #220 of 319 statewide, top 70%, 1,435 students, 100% FRL) — zoned schools average 106% FRL vs 60% district-wide (46 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 124 active listings in the ZIP; 15 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 53% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 300 units permitted in Portsmouth city in 2024 (112 in 5+ unit buildings).
• 3 sale attempts since 4y 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 $131k; 18% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.6% vs local median 4.6% in Portsmouth — 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 145 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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?
• 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.