305 W 2nd St

Calhoun, MO 65323

$120,000D

3 bd · 1.5 ba · 1,056 sqft · Built 1979 · Other · Pending · 97 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $958/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$133
• HOA: −$0
• Vac / Maint / Mgmt: −$201
• Net cashflow: $-5/mo
• Annual: $-64/yr
• Cap rate: 6.24%
• Cash-on-cash: -0.19%
• DSCR: 0.99
• 1% rule: 0.80%
• Cash to close: $33,600

Investor read

• This is a 3-bed/1.5-bath other listed at $120k.
• At list price, monthly cash flow is $-5 ($-64/yr) — negative.
• To cash-flow at today's rent, offer at most $119k (0.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $96k (20.1% below list).
• It's been on market 97 days — a 9% lower offer ($109k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (20.1% below list) — sets the bar for 1% rule.
• In year one you build about $8k of equity ($830 loan paydown + $7k appreciation (6.1% local appreciation)).
• Location reads 53/100 on livability (#844 in MO) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing B+; Watch: schools F, crime F, amenities F.
• Calhoun R-VIII (rural): math 11% / reading 20% proficiency, ranked #520 of 535 in MO (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 63% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 7 active listings in the ZIP; 15 units permitted in Henry County in 2024 (0 in 5+ unit buildings).
• Henry County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 4 sale attempts since 20y ago; this cycle's ask has dropped $10k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (6.1% appreciation + 3.0% rent growth), your $34k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 5, paydown + projected appreciation supports a ~$36k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate wildfire risk — expect insurance premiums to compound above CPI over the hold.

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 97 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• Built in 1979 — 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 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?
• 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?