1001 Royal Dr SE

Decatur, AL 35601

$99,900B+

3 bd · 1.0 ba · 1,472 sqft · Built 1966 · SingleFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,307/mo
• Mortgage (P&I): −$524
• Tax + insurance: −$511
• HOA: −$0
• Vac / Maint / Mgmt: −$274
• Net cashflow: $-2/mo
• Annual: $-30/yr
• Cap rate: 11.39%
• Cash-on-cash: 18.19%
• DSCR: 1.81
• 1% rule: 1.31%
• Cash to close: $27,972

Investor read

• This is a 3-bed/1.0-bath single-family listed at $100k.
• At list price, monthly cash flow is $-2 ($-30/yr) — negative.
• To cash-flow at today's rent, offer at most $99k (0.4% below list).
• Meets the 1% rule at list price ($1k rent vs $100k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $99k (0.4% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $691 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#28 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D+, crime F, amenities F.
• Decatur City (urban): math 22% / reading 40% proficiency, ranked #66 of 129 in AL (top 51%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Walter Jackson Elementary School (math 47% / reading 62%, grade C, #87 of 627 statewide, top 15%, 244 students, 73% FRL); Decatur Middle School (math 17% / reading 36%, grade F, #150 of 257 statewide, top 60%, 815 students, 77% FRL); Decatur High School (math 27% / reading 27%, grade F, #90 of 305 statewide, top 35%, 1,040 students, 67% FRL) — zoned schools average 72% FRL vs 57% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: Rents rising fast (+4.7%/yr); 225 active listings in the ZIP; 15 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 87% of comp listings sitting > 30 days — soft ceiling on asking rent; 231 units permitted in Morgan County in 2024 (0 in 5+ unit buildings).
• Morgan County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 14y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $53k; list at $100k implies a 88% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.4% vs local median 4.0% in Decatur — 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 30% of the median local income ($51k/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?
• Built in 1966 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?
• 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.