745 S Second St

Globe, AZ 85501

$19,900B-

1 bd · 1.0 ba · 476 sqft · Built 1963 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $792/mo
• Mortgage (P&I): −$104
• Tax + insurance: −$90
• HOA: −$21
• Vac / Maint / Mgmt: −$166
• Net cashflow: $410/mo
• Annual: $4,919/yr
• Cap rate: 35.02%
• Cash-on-cash: 102.60%
• DSCR: 5.57
• 1% rule: 3.98%
• Cash to close: $5,572

Investor read

• This is a 1-bed/1.0-bath single-family listed at $20k.
• At list price, monthly cash flow is $410 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($792 rent vs $20k).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $138 of loan paydown is wiped out by about $597 of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#145 in AZ) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: amenities D+, health & safety D+, crime F.
• Globe Unified District (4208) (town): math 11% / reading 21% proficiency, ranked #206 of 249 in AZ (top 83%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Copper Rim Elementary School (math 14% / reading 22%, grade F, #796 of 1,109 statewide, top 72%, 765 students, 56% FRL); High Desert Middle School (math 9% / reading 18%, grade F, #167 of 218 statewide, top 77%, 407 students, 55% FRL); Globe High School (math 12% / reading 22%, grade F, #252 of 381 statewide, top 67%, 498 students, 46% FRL) — zoned schools at 52% FRL track the district average.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 65 active listings in the ZIP; 217 units permitted in Gila County in 2024 (0 in 5+ unit buildings).
• Gila County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $6k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; major wildfire risk; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 35.0% vs local median 5.8% in Globe — 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

• Built in 1963 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.