8516 Sophia Nicolle Ct SE

Huntsville, AL 35748

$375,900D

4 bd · 3.0 ba · 2,019 sqft · Built — · SingleFamily · Pending · 78 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,700/mo
• Mortgage (P&I): −$1,971
• Tax + insurance: −$626
• HOA: −$40
• Vac / Maint / Mgmt: −$567
• Net cashflow: $-505/mo
• Annual: $-6,057/yr
• Cap rate: 4.68%
• Cash-on-cash: -5.75%
• DSCR: 0.74
• 1% rule: 0.72%
• Cash to close: $105,252

Investor read

• This is a 4-bed/3.0-bath single-family listed at $376k.
• At list price, monthly cash flow is $-505 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $303k (19.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $270k (28.2% below list).
• It's been on market 78 days — a 6% lower offer ($353k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $270k (28.2% below list) — sets the bar for 1% rule.
• In year one you build about $40k of equity ($3k loan paydown + $38k appreciation (10.0% local appreciation)).
• Location reads 82/100 on livability (#3 in AL, #1,082 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F.
• Huntsville City (urban): math 21% / reading 46% proficiency, ranked #48 of 129 in AL (top 37%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Hampton Cove Elementary (math 60% / reading 77%, grade B+, #32 of 627 statewide, top 5%, 684 students, 9% FRL); Hampton Cove Middle School (math 45% / reading 72%, grade B, #12 of 257 statewide, top 4%, 735 students, 11% FRL); Huntsville High School (math 41% / reading 51%, grade D-, #18 of 305 statewide, top 6%, 1,826 students, 28% FRL) — zoned schools average 16% FRL vs 46% district-wide (31 pts lower); this property's tenant base skews higher-income than the district average.
• Zoned-school proficiency averages 58% at this address vs 34% district-wide (+24 pts) — the actual schools serving this property are materially stronger than the Huntsville City average implies; a family-tenant draw the district grade alone would hide.
• Market conditions: 184 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 4,709 units permitted in Madison County in 2024 (1,186 in 5+ unit buildings).
• Madison County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 2, paydown + projected appreciation supports a ~$65k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 8→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.7% vs local median 3.8% in Huntsville — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 78 days. Have you received any prior offers? Is the seller open to a 28% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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?
• 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.