416 Terry Ct Unit A3

Frederick, MD 21701

$234,900D

2 bd · 2.0 ba · 860 sqft · Built 1984 · Condo · Active · 78 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,949/mo
• Mortgage (P&I): −$1,232
• Tax + insurance: −$302
• HOA: −$247
• Vac / Maint / Mgmt: −$409
• Net cashflow: $-241/mo
• Annual: $-2,891/yr
• Cap rate: 5.06%
• Cash-on-cash: -4.39%
• DSCR: 0.80
• 1% rule: 0.83%
• Cash to close: $65,772

Investor read

• This is a 2-bed/2.0-bath condo listed at $235k.
• At list price, monthly cash flow is $-241 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $192k (18.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $195k (17.0% below list).
• It's been on market 78 days — a 6% lower offer ($221k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $192k (18.1% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#80 in MD, #3,041 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A+; Watch: amenities C-, crime D+, cost of living D+.
• Frederick County Public Schools (other): math 27% / reading 43% proficiency, ranked #4 of 24 in MD (top 17%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents flat; 269 active listings in the ZIP; 32 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 47% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 1,562 units permitted in Frederick County in 2024 (374 in 5+ unit buildings).
• Frederick County population projected at +15% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 30y ago; this cycle's ask has dropped $14k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.1% vs local median 3.3% in Frederick — 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 78 days. Have you received any prior offers? Is the seller open to a 18% 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?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 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?