203 W 3rd St

Freeman, MO 64746

$125,000D

2 bd · 1.0 ba · 864 sqft · Built — · Other · Active · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $925/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$208
• HOA: −$0
• Vac / Maint / Mgmt: −$194
• Net cashflow: $-133/mo
• Annual: $-1,597/yr
• Cap rate: 5.02%
• Cash-on-cash: -4.56%
• DSCR: 0.80
• 1% rule: 0.74%
• Cash to close: $35,000

Investor read

• This is a 2-bed/1.0-bath other listed at $125k.
• At list price, monthly cash flow is $-133 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $106k (15.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $92k (26.0% below list).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $92k (26.0% below list) — sets the bar for 1% rule.
• In year one you build about $13k of equity ($864 loan paydown + $12k appreciation (10.0% local appreciation)).
• Location reads 60/100 on livability (#499 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, employment B; Watch: crime D+, amenities F, commute F.
• Midway R-I (rural): math 27% / reading 40% proficiency, ranked #201 of 324 in MO (top 62%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Midway Elem. (math 32% / reading 42%, grade F, #611 of 1,115 statewide, top 59%, 243 students, 35% FRL); Midway High (math 22% / reading 37%, grade F, #382 of 521 statewide, top 78%, 206 students, 31% FRL) — zoned schools at 33% FRL track the district average.
• Market conditions: 14 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 588 units permitted in Cass County in 2024 (0 in 5+ unit buildings).
• Cass County population projected to shrink 3% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• By year 3, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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?
• 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 D 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?
• 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.