25 Peru St

Burlington, VT 05401

$575,000C

2 bd · 2.0 ba · 2,478 sqft · Built 1899 · MultiFamily · Active · 34 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,944/mo
• Mortgage (P&I): −$3,015
• Tax + insurance: −$646
• HOA: −$0
• Vac / Maint / Mgmt: −$1,248
• Net cashflow: $1,034/mo
• Annual: $12,414/yr
• Cap rate: 8.45%
• Cash-on-cash: 7.71%
• DSCR: 1.34
• 1% rule: 1.03%
• Cash to close: $161,000

Investor read

• This is a 2 × 4-bed/1.0-bath units multifamily listed at $575k.
• At list price, monthly cash flow is $1k ($12k/yr) — positive. Per door: $517/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $575k).
• It's been on market 34 days — a 3% lower offer ($558k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $558k (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 $17k 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+, schools B; Watch: cost of living D, crime F, amenities F.
• Watch-outs: built in 1899 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 138 active listings in the ZIP; 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.
• 4 sale attempts since 6y 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 $385k; 49% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 8.5% vs local median 3.1% 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 $5,944/mo this rent would consume 109% 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 34 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 1899 — 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 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.