2122 Speed Ave

Louisville, KY 40205

$450,000C+

4 bd · 4.0 ba · 2,630 sqft · Built 1930 · MultiFamily · Pending · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,848/mo
• Mortgage (P&I): −$2,360
• Tax + insurance: −$596
• HOA: −$0
• Vac / Maint / Mgmt: −$1,018
• Net cashflow: $874/mo
• Annual: $10,483/yr
• Cap rate: 8.77%
• Cash-on-cash: 8.85%
• DSCR: 1.39
• 1% rule: 1.08%
• Cash to close: $126,000

Investor read

• This is a 4-bed/4.0-bath multifamily listed at $450k.
• At list price, monthly cash flow is $874 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $450k).
• It's been on market 20 days — a 2% lower offer ($443k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $443k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $14k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#333 in KY) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment C-, health & safety D+, crime F.
• Jefferson County (urban): math 19% / reading 35% proficiency, ranked #121 of 165 in KY (top 73%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Bloom Elementary (math 26% / reading 57%, grade F, #197 of 676 statewide, top 29%, 525 students, 24% FRL); Highland Middle (math 10% / reading 41%, grade F, #181 of 217 statewide, top 84%, 801 students, 59% FRL); Atherton High (math 52% / reading 47%, grade D, #13 of 254 statewide, top 5%, 1,461 students, 39% FRL) — zoned schools average 41% FRL vs 56% district-wide (15 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: flood insurance adds $56/mo; built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.4%/yr); 127 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 18d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 2,836 units permitted in Jefferson County in 2024 (1,558 in 5+ unit buildings).
• Jefferson County population projected at +13% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (-3.0% appreciation + 5.4% rent growth), your $126k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.8% vs local median 5.0% in Louisville — 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.
• At $4,848/mo this rent would consume 58% of the median local household income ($100k/yr) (locally 492% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1930 — 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.
• 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.
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.