8545 Summa Ave #5

Baton Rouge, LA 70809

$110,000D

1 bd · 1.5 ba · 880 sqft · Built 1986 · Condo · Active · 239 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,163/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$183
• HOA: −$225
• Vac / Maint / Mgmt: −$244
• Net cashflow: $-66/mo
• Annual: $-792/yr
• Cap rate: 5.57%
• Cash-on-cash: -2.57%
• DSCR: 0.89
• 1% rule: 1.06%
• Cash to close: $30,800

Investor read

• This is a 1-bed/1.5-bath condo listed at $110k. Condition is rated good.
• At list price, monthly cash flow is $-66 ($-792/yr) — negative.
• To cash-flow at today's rent, offer at most $100k (8.7% below list).
• Meets the 1% rule at list price ($1k rent vs $110k).
• It's been on market 239 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 74/100 on livability (#24 in LA, #4,535 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, health & safety A+; Watch: amenities D, crime F, employment D-.
• East Baton Rouge Parish (urban): math 22% / reading 34% proficiency, ranked #47 of 98 in LA (top 48%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 77% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Westminster Elementary School (math 12% / reading 22%, grade F, #487 of 646 statewide, top 78%, 333 students, 80% FRL); Westdale Middle School (math 15% / reading 30%, grade F, #151 of 218 statewide, top 70%, 757 students, 69% FRL); Liberty High School (math 50% / reading 74%, grade B-, #15 of 265 statewide, top 6%, 1,208 students, 60% FRL).
• Market conditions: Rents rising (+2.2%/yr); 307 active listings in the ZIP; 23 comparable units currently listed for rent nearby; rentals at typical pace (median 16d on market — plan ~3-4 weeks tenant-placement turnaround); 48% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 2,252 units permitted in East Baton Rouge Parish in 2024 (440 in 5+ unit buildings).
• East Baton Rouge County population projected at +4% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts; this cycle's ask has dropped $17k (13%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: major flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.6% vs local median 4.1% in Baton Rouge — 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 is only 17% of the median local income ($80k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 239 days. Have you received any prior offers? Is the seller open to a 12% 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?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?