721 Martin Luther King Jr. Dr

Paducah, KY 42001

$215,000D

3 bd · 2.0 ba · 2,536 sqft · Built 1897 · SingleFamily · Active · 118 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,540/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$126
• HOA: −$0
• Vac / Maint / Mgmt: −$323
• Net cashflow: $-37/mo
• Annual: $-441/yr
• Cap rate: 6.09%
• Cash-on-cash: -0.73%
• DSCR: 0.97
• 1% rule: 0.72%
• Cash to close: $60,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $215k.
• At list price, monthly cash flow is $-37 ($-441/yr) — negative.
• To cash-flow at today's rent, offer at most $209k (3.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $154k (28.4% below list).
• It's been on market 118 days — a 9% lower offer ($196k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $154k (28.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#197 in KY) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime C-, schools D+, employment D.
• Paducah Independent (town): math 22% / reading 36% proficiency, ranked #122 of 165 in KY (top 74%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 69% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1897 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 248 active listings in the ZIP; 187 units permitted in McCracken County in 2024 (104 in 5+ unit buildings).
• McCracken County population projected to shrink 9% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 3y ago; this cycle's ask has dropped $35k (14%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 4.5% in Paducah — 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 118 days. Have you received any prior offers? Is the seller open to a 28% concession, seller financing, or rate buy-down credit?
• Built in 1897 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.