2001 Ostrom Dr

Mobile, AL 36605

$90,000B-

3 bd · 1.0 ba · 960 sqft · Built 1995 · SingleFamily · Active · 210 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,138/mo
• Mortgage (P&I): −$472
• Tax + insurance: −$494
• HOA: −$0
• Vac / Maint / Mgmt: −$239
• Net cashflow: $-67/mo
• Annual: $-807/yr
• Cap rate: 11.08%
• Cash-on-cash: 17.11%
• DSCR: 1.76
• 1% rule: 1.26%
• Cash to close: $25,200

Investor read

• This is a 3-bed/1.0-bath single-family listed at $90k.
• At list price, monthly cash flow is $-67 ($-807/yr) — negative.
• To cash-flow at today's rent, offer at most $78k (13.2% below list).
• Meets the 1% rule at list price ($1k rent vs $90k).
• It's been on market 210 days — a 12% lower offer ($79k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $78k (13.2% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $622 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#20 in AL, #4,262 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: schools D-, crime F, employment D-.
• Mobile County (urban): math 15% / reading 39% proficiency, ranked #81 of 129 in AL (top 63%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: Rents rising fast (+8.3%/yr); 139 active listings in the ZIP; 13 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 1,678 units permitted in Mobile County in 2024 (264 in 5+ unit buildings).
• Mobile County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 6→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.1% vs local median 4.9% in Mobile — 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 runs 31% of the median local income ($44k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 210 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.
• Schools are D-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.