220 Hillcrest Dr

Montevallo, AL 35115

$289,900D+

4 bd · 2.0 ba · 1,919 sqft · Built 2018 · SingleFamily · Pending · 29 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,708/mo
• Mortgage (P&I): −$1,520
• Tax + insurance: −$190
• HOA: −$19
• Vac / Maint / Mgmt: −$569
• Net cashflow: $411/mo
• Annual: $4,927/yr
• Cap rate: 7.99%
• Cash-on-cash: 6.07%
• DSCR: 1.27
• 1% rule: 0.93%
• Cash to close: $81,172

Investor read

• This is a 4-bed/2.0-bath single-family listed at $290k.
• At list price, monthly cash flow is $411 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $271k (6.6% below list).
• It's been on market 29 days — a 2% lower offer ($286k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $271k (6.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#217 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, crime A, housing B+; Watch: amenities F, commute F, employment F.
• Shelby County (suburban): math 30% / reading 58% proficiency, ranked #16 of 129 in AL (top 12%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Montevallo Elementary School (math 29% / reading 49%, grade F, #257 of 627 statewide, top 41%, 749 students, 77% FRL); Montevallo Middle School (math 5% / reading 43%, grade F, #168 of 257 statewide, top 66%, 369 students, 78% FRL); Montevallo High School (math 17% / reading 27%, grade F, #142 of 305 statewide, top 51%, 506 students, 76% FRL) — zoned schools average 77% FRL vs 26% district-wide (51 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 28% at this address vs 44% district-wide (-16 pts) — the specific schools serving this property underperform the Shelby County average; the district grade overstates school quality for this exact location.
• Market conditions: 115 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals leasing fast (median 12d on market — plan ~1-2 weeks tenant-placement turnaround); 987 units permitted in Shelby County in 2024 (0 in 5+ unit buildings).
• Shelby County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 9y ago; this cycle's ask is 67% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $173k; list at $290k implies a 67% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 50% chance of damaging wind over 30y; moderate wildfire 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 8.0% vs local median 3.7% in Montevallo — 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

• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.
• 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.