509 Sherwood Ave

Bonanza, AR 72916

$85,000B-

2 bd · 1.0 ba · 1,285 sqft · Built 1980 · SingleFamily · Active · 59 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,436/mo
• Mortgage (P&I): −$446
• Tax + insurance: −$142
• HOA: −$0
• Vac / Maint / Mgmt: −$301
• Net cashflow: $547/mo
• Annual: $6,561/yr
• Cap rate: 14.01%
• Cash-on-cash: 27.57%
• DSCR: 2.23
• 1% rule: 1.69%
• Cash to close: $23,800

Investor read

• This is a 2-bed/1.0-bath single-family listed at $85k.
• At list price, monthly cash flow is $547 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $85k).
• It's been on market 59 days — a 3% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $82k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $588 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#137 in AR) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, employment D-.
• Hackett School District (rural): math 24% / reading 29% proficiency, ranked #173 of 238 in AR (top 73%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Hackett Elementary School (math 24% / reading 16%, grade F, #376 of 454 statewide, top 84%, 493 students, 100% FRL); Hackett High School (math 24% / reading 40%, grade F, #119 of 292 statewide, top 43%, 327 students, 100% FRL) — zoned schools average 100% FRL vs 54% district-wide (46 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+1.6%/yr); 239 active listings in the ZIP; solid renter incomes; 388 units permitted in Sebastian County in 2024 (16 in 5+ unit buildings).
• Sebastian County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (-3.0% appreciation + 1.6% rent growth), your $24k cash investment doubles in ~5 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 59 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• 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?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.