557 May Valley Dr

Murphy, MO 63026

$355,000F

4 bd · 2.5 ba · 1,948 sqft · Built 1978 · SingleFamily · Pending · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,170/mo
• Mortgage (P&I): −$1,862
• Tax + insurance: −$478
• HOA: −$15
• Vac / Maint / Mgmt: −$456
• Net cashflow: $-640/mo
• Annual: $-7,680/yr
• Cap rate: 4.13%
• Cash-on-cash: -7.73%
• DSCR: 0.66
• 1% rule: 0.61%
• Cash to close: $99,400

Investor read

• This is a 4-bed/2.5-bath single-family listed at $355k.
• At list price, monthly cash flow is $-640 ($-8k/yr) — negative.
• To cash-flow at today's rent, offer at most $242k (31.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $217k (38.9% below list).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $217k (38.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#461 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime D+, employment D+, amenities F.
• Rockwood R-VI (suburban): math 51% / reading 64% proficiency, ranked #9 of 324 in MO (top 3%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 10% free/reduced lunch — higher-income household profile.
• Zoned schools: Bowles Elem. (math 42% / reading 47%, grade F, #413 of 1,115 statewide, top 42%, 291 students, 20% FRL); Rockwood Summit Sr. High (math 35% / reading 68%, grade D+, #108 of 521 statewide, top 21%, 1,229 students, 16% FRL).
• Market conditions: Rents rising fast (+7.7%/yr); 146 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 920 units permitted in St. Louis County in 2024 (250 in 5+ unit buildings).
• 2 sale attempts since 6y 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 $258k; 38% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• 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 4.1% vs local median 3.0% in Murphy — 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?
• Built in 1978 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.