85 Middle St #10

Hallowell, ME 04347

$157,000C

2 bd · 1.0 ba · 855 sqft · Built 1900 · Condo · Active · 31 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,998/mo
• Mortgage (P&I): −$823
• Tax + insurance: −$243
• HOA: −$362
• Vac / Maint / Mgmt: −$420
• Net cashflow: $151/mo
• Annual: $1,806/yr
• Cap rate: 7.44%
• Cash-on-cash: 4.11%
• DSCR: 1.18
• 1% rule: 1.27%
• Cash to close: $43,960

Investor read

• This is a 2-bed/1.0-bath condo listed at $157k.
• At list price, monthly cash flow is $151 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $157k).
• It's been on market 31 days — a 3% lower offer ($152k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $152k (3.0% 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 71/100 on livability (#60 in ME) — a middle-class / working-renter tenant base. Strengths: crime A+, housing A+, health & safety A+; Watch: amenities F, commute F.
• RSU 02 (rural): math 83% / reading 87% proficiency, ranked #52 of 112 in ME (top 46%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 25 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 460 units permitted in Kennebec County in 2024 (0 in 5+ unit buildings).
• Kennebec County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 7.4% vs local median 2.7% in Hallowell — 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 31 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.