531 Carlton St

Andalusia, AL 36420

$129,900D+

3 bd · 2.0 ba · 1,068 sqft · Built 1930 · SingleFamily · Active · 59 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $955/mo
• Mortgage (P&I): −$681
• Tax + insurance: −$84
• HOA: −$0
• Vac / Maint / Mgmt: −$201
• Net cashflow: $-11/mo
• Annual: $-132/yr
• Cap rate: 6.19%
• Cash-on-cash: -0.36%
• DSCR: 0.98
• 1% rule: 0.74%
• Cash to close: $36,372

Investor read

• This is a 3-bed/2.0-bath single-family listed at $130k.
• At list price, monthly cash flow is $-11 ($-132/yr) — negative.
• To cash-flow at today's rent, offer at most $128k (1.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $96k (26.5% below list).
• It's been on market 59 days — a 3% lower offer ($126k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (26.5% below list) — sets the bar for 1% rule.
• In year one you build about $10k of equity ($898 loan paydown + $9k appreciation (6.8% local appreciation)).
• Location reads 65/100 on livability (#142 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, crime F, amenities F.
• Andalusia City (town): math 29% / reading 48% proficiency, ranked #35 of 129 in AL (top 27%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 87 active listings in the ZIP; 13 units permitted in Covington County in 2024 (0 in 5+ unit buildings).
• Covington County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 2y ago; this cycle's ask has dropped $20k (13%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $30k; list at $130k implies a 333% gain — meaningful room to come down on a strong offer.
• At projected returns (6.8% appreciation + 3.0% rent growth), your $36k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$33k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.2% vs local median 4.1% in Andalusia — 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 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 59 days. Have you received any prior offers? Is the seller open to a 26% concession, seller financing, or rate buy-down credit?
• Built in 1930 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.