864 Pettus St

Mobile, AL 36603

$84,900A-

3 bd · 2.0 ba · 1,615 sqft · Built 1969 · SingleFamily · Pending · 32 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,717/mo
• Mortgage (P&I): −$445
• Tax + insurance: −$185
• HOA: −$0
• Vac / Maint / Mgmt: −$360
• Net cashflow: $726/mo
• Annual: $8,711/yr
• Cap rate: 17.49%
• Cash-on-cash: 40.00%
• DSCR: 2.78
• 1% rule: 2.02%
• Cash to close: $23,772

Investor read

• This is a 3-bed/2.0-bath single-family listed at $85k.
• At list price, monthly cash flow is $726 ($9k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $85k).
• It's been on market 32 days — a 3% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $82k (3.0% below list) — sets the bar for market timing.
• In year one you build about $2k of equity ($587 loan paydown + $1k appreciation (1.3% local appreciation)).
• Location reads 75/100 on livability (#20 in AL, #4,262 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F, employment D-.
• Mobile County (urban): math 15% / reading 39% proficiency, ranked #81 of 129 in AL (top 63%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Erwin Craighead Elementary School (math 2% / reading 22%, grade F, #536 of 627 statewide, top 88%, 420 students, 89% FRL); Calloway Smith Middle School (math 0% / reading 18%, grade F, #235 of 257 statewide, top 93%, 396 students, 96% FRL); Lillie B Williamson High School (math 2% / reading 12%, grade F, #273 of 305 statewide, top 89%, 956 students, 94% FRL) — zoned schools average 93% FRL vs 67% district-wide (26 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 10% at this address vs 27% district-wide (-18 pts) — the specific schools serving this property underperform the Mobile County average; the district grade overstates school quality for this exact location.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 36 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 1,678 units permitted in Mobile County in 2024 (264 in 5+ unit buildings).
• Mobile County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 3y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $6k; list at $85k implies a 1315% gain — meaningful room to come down on a strong offer.
• At projected returns (1.3% appreciation + 3.0% rent growth), your $24k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 32 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1969 — 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.