4079 Malabar Rd

Montgomery, AL 36116

$169,900C-

5 bd · 2.0 ba · 1,812 sqft · Built 1973 · SingleFamily · Active · 114 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,792/mo
• Mortgage (P&I): −$891
• Tax + insurance: −$179
• HOA: −$0
• Vac / Maint / Mgmt: −$376
• Net cashflow: $345/mo
• Annual: $4,146/yr
• Cap rate: 8.73%
• Cash-on-cash: 8.71%
• DSCR: 1.39
• 1% rule: 1.05%
• Cash to close: $47,572

Investor read

• This is a 5-bed/2.0-bath single-family listed at $170k.
• At list price, monthly cash flow is $345 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $170k).
• It's been on market 114 days — a 9% lower offer ($155k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $155k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#138 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment D, crime F, amenities D-.
• Montgomery County (urban): math 9% / reading 31% proficiency, ranked #106 of 129 in AL (top 82%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 70% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Crump Elementary School (math 2% / reading 17%, grade F, #568 of 627 statewide, top 94%, 497 students, 93% FRL); Mckee Middle School (math 0% / reading 13%, grade F, #249 of 257 statewide, top 98%, 676 students, 94% FRL); Jefferson Davis High School (math 3% / reading 16%, grade F, #258 of 305 statewide, top 85%, 1,522 students, 83% FRL) — zoned schools average 90% FRL vs 70% district-wide (20 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+5.7%/yr); 293 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 56% of comp listings sitting > 30 days — soft ceiling on asking rent; 460 units permitted in Montgomery County in 2024 (37 in 5+ unit buildings).
• Montgomery County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 8y 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 $137k; 24% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 5.7% rent growth), your $48k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% 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 8.7% vs local median 6.0% in Montgomery — 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 runs 39% of the median local income ($55k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 114 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1973 — 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.
• 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.
• 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.