405 W Locust St

Scottsville, KY 42164

$115,000D-

2 bd · 1.0 ba · 910 sqft · Built 1977 · SingleFamily · Active · 64 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $882/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$71
• HOA: −$0
• Vac / Maint / Mgmt: −$185
• Net cashflow: $23/mo
• Annual: $274/yr
• Cap rate: 6.53%
• Cash-on-cash: 0.85%
• DSCR: 1.04
• 1% rule: 0.77%
• Cash to close: $32,200

Investor read

• This is a 2-bed/1.0-bath single-family listed at $115k.
• At list price, monthly cash flow is $23 ($274/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 $88k (23.3% below list).
• It's been on market 64 days — a 6% lower offer ($108k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $88k (23.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $795 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#329 in KY) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A; Watch: schools F, amenities F, commute F.
• Allen County (rural): math 29% / reading 37% proficiency, ranked #85 of 165 in KY (top 52%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 239 active listings in the ZIP; 9 units permitted in Allen County in 2024 (0 in 5+ unit buildings).
• Allen County population projected at +6% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts; this cycle's ask has dropped $10k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.5% vs local median 2.1% in Scottsville — 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

• It's been on market 64 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• Built in 1977 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• Schools are F-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.