225 County Road 108

Water Valley, MS 38965

$125,500C+

2 bd · 1.0 ba · 704 sqft · Built 1981 · Other · Pending · 78 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,393/mo
• Mortgage (P&I): −$658
• Tax + insurance: −$80
• HOA: −$0
• Vac / Maint / Mgmt: −$293
• Net cashflow: $363/mo
• Annual: $4,354/yr
• Cap rate: 9.76%
• Cash-on-cash: 12.39%
• DSCR: 1.55
• 1% rule: 1.11%
• Cash to close: $35,140

Investor read

• This is a 2-bed/1.0-bath other listed at $126k.
• At list price, monthly cash flow is $363 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $126k).
• It's been on market 78 days — a 6% lower offer ($118k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $118k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $868 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#233 in MS) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety D+, schools F, crime F.
• Water Valley School District (town): math 29% / reading 36% proficiency, ranked #61 of 130 in MS (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 64% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 72 active listings in the ZIP; 24 units permitted in Yalobusha County in 2024 (0 in 5+ unit buildings).
• Yalobusha County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 4 sale attempts 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $35k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 78 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• 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 F-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?
• 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 for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.