Hampton B Plan

Opelika, AL 36801

$272F

4 bd · 2.5 ba · 1,535 sqft · Built — · SingleFamily · Active · 40 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,955/mo
• Mortgage (P&I): −$2,031
• Tax + insurance: −$645
• HOA: −$0
• Vac / Maint / Mgmt: −$411
• Net cashflow: $-1,132/mo
• Annual: $-13,582/yr
• Cap rate: 2.79%
• Cash-on-cash: -12.52%
• DSCR: 0.44
• 1% rule: 0.50%
• Cash to close: $108,441

Investor read

• This is a 4-bed/2.5-bath single-family listed at $272.
• At list price, monthly cash flow is $-1k ($-14k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $272).
• It's been on market 40 days — a 3% lower offer ($263) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $263 (3.3% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#188 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools C-, employment C-, crime F.
• Opelika City (urban): math 27% / reading 43% proficiency, ranked #45 of 129 in AL (top 35%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 2135.8% of price.
• Market conditions: Rents rising fast (+6.2%/yr); 532 active listings in the ZIP; 1,858 units permitted in Lee County in 2024 (113 in 5+ unit buildings).
• Lee County population projected at +54% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 2.8% vs local median 3.8% in Opelika — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 38% of the median local income ($62k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 40 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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?
• 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.