6371 Highway 17

Underwood-Petersville, AL 35634

$110,000B-

3 bd · 1.0 ba · 1,600 sqft · Built 1980 · SingleFamily · Pending · 143 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,456/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$131
• HOA: −$0
• Vac / Maint / Mgmt: −$306
• Net cashflow: $442/mo
• Annual: $5,307/yr
• Cap rate: 11.12%
• Cash-on-cash: 17.23%
• DSCR: 1.77
• 1% rule: 1.32%
• Cash to close: $30,800

Investor read

• This is a 3-bed/1.0-bath single-family listed at $110k.
• At list price, monthly cash flow is $442 ($5k/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 143 days — a 12% lower offer ($97k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $97k (12.0% 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: area grade B — affects rentability + tenant quality, not the cash-flow math above.
• Lauderdale County (rural): math 19% / reading 46% proficiency, ranked #53 of 129 in AL (top 41%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Central Elementary School (714 students, 63% FRL); Central High School (math 16% / reading 44%, grade F, #67 of 305 statewide, top 22%, 603 students, 62% FRL) — zoned schools average 63% FRL vs 37% district-wide (26 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 183 active listings in the ZIP; 164 units permitted in Lauderdale County in 2024 (72 in 5+ unit buildings).
• 2 sale attempts since 3y ago; this cycle's ask has dropped $20k (15%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $94k; 17% 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.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.1% vs local median 3.3% in Underwood-Petersville — 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 143 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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.