501 Gables Dr

Hoover, AL 35244

$122,000F

1 bd · 2.0 ba · 1,001 sqft · Built 1987 · Condo · Active · 37 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,181/mo
• Mortgage (P&I): −$640
• Tax + insurance: −$203
• HOA: −$268
• Vac / Maint / Mgmt: −$248
• Net cashflow: $-178/mo
• Annual: $-2,141/yr
• Cap rate: 4.54%
• Cash-on-cash: -6.27%
• DSCR: 0.72
• 1% rule: 0.97%
• Cash to close: $34,160

Investor read

• This is a 1-bed/2.0-bath condo listed at $122k. Condition is rated poor.
• At list price, monthly cash flow is $-178 ($-2k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $118k (3.2% below list).
• It's been on market 37 days — a 3% lower offer ($118k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $118k (3.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $843 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 84/100 on livability (#1 in AL, #630 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, housing A+.
• Hoover City (urban): math 45% / reading 66% proficiency, ranked #8 of 129 in AL (top 6%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 19% free/reduced lunch — higher-income household profile.
• Watch-outs: HOA is 23% of rent.
• Market conditions: Rents soft (-0.5%/yr); 444 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals leasing fast (median 3d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 987 units permitted in Shelby County in 2024 (0 in 5+ unit buildings).
• Shelby County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 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.
• Climate carrying-cost: major wind risk, 44% chance of damaging wind over 30y; extreme-heat days projected 6→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.5% vs local median 2.4% in Hoover — 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.
• This rent is only 12% of the median local income ($113k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 37 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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.
• Schools are A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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?

Repairs flagged (vision-AI assessment)

• Major: roof — Signs of potential leaks and wear.
• Major: exterior siding — Visible cracks and discoloration.
• Major: flooring — Significant wear and tear.
• Major: interior walls/paint — Peeling paint and discoloration.
• Major: HVAC/mechanicals — No visible signs of recent maintenance or updates.
• Major: landscaping — Overgrown and in need of trimming and maintenance.