15 N Sycamore St

Mount Sterling, KY 40353

$110,000B-

3 bd · 2.0 ba · 2,385 sqft · Built 1938 · Other · Pending · 64 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,428/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$86
• HOA: −$0
• Vac / Maint / Mgmt: −$300
• Net cashflow: $465/mo
• Annual: $5,578/yr
• Cap rate: 11.36%
• Cash-on-cash: 18.11%
• DSCR: 1.81
• 1% rule: 1.30%
• Cash to close: $30,800

Investor read

• This is a 3-bed/2.0-bath other listed at $110k.
• At list price, monthly cash flow is $465 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $110k).
• It's been on market 64 days — a 6% lower offer ($103k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $103k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $761 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#297 in KY) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B+; Watch: amenities F, commute F, employment F.
• Montgomery County (rural): math 24% / reading 44% proficiency, ranked #76 of 165 in KY (top 46%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Mapleton Elementary School (math 32% / reading 47%, grade F, #208 of 676 statewide, top 34%, 510 students, 56% FRL); Mcnabb Middle School (math 19% / reading 47%, grade F, #112 of 217 statewide, top 53%, 1,018 students, 55% FRL); Montgomery County High School (math 29% / reading 39%, grade F, #89 of 254 statewide, top 36%, 1,279 students, 47% FRL) — zoned schools at 53% FRL track the district average.
• Watch-outs: built in 1938 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 116 active listings in the ZIP; 56 units permitted in Montgomery County in 2024 (0 in 5+ unit buildings).
• Montgomery County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 21y ago; this cycle's ask has dropped $10k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $95k; 16% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $31k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 11.4% vs local median 3.3% in Mount Sterling — 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

• It's been on market 64 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1938 — 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.
• 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.