2023 E Yonge St

Pensacola, FL 32503

$425,000D

3 bd · 2.0 ba · 2,118 sqft · Built 1948 · SingleFamily · Active · 118 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,862/mo
• Mortgage (P&I): −$2,229
• Tax + insurance: −$378
• HOA: −$0
• Vac / Maint / Mgmt: −$601
• Net cashflow: $-345/mo
• Annual: $-4,144/yr
• Cap rate: 5.32%
• Cash-on-cash: -3.48%
• DSCR: 0.85
• 1% rule: 0.67%
• Cash to close: $119,000

Investor read

• This is a 3-bed/2.0-bath single-family listed at $425k.
• At list price, monthly cash flow is $-345 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $364k (14.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $286k (32.6% below list).
• It's been on market 118 days — a 9% lower offer ($387k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $286k (32.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#53 in FL, #924 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+.
• Escambia (suburban): math 40% / reading 45% proficiency, ranked #56 of 73 in FL (top 77%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.4%/yr); 240 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 1,479 units permitted in Escambia County in 2024 (0 in 5+ unit buildings).
• Escambia County population projected at +13% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 3 sale attempts since 14y ago; this cycle's ask has dropped $24k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $125k; list at $425k implies a 240% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.3% vs local median 3.6% in Pensacola — 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.
• At $2,862/mo this rent would consume 48% of the median local household income ($71k/yr) (locally 948% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 118 days. Have you received any prior offers? Is the seller open to a 33% concession, seller financing, or rate buy-down credit?
• Built in 1948 — 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.
• 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.