Cambridge II Plan

Herculaneum, MO 63048

$31,610F

3 bd · 2.0 ba · 1,498 sqft · Built — · SingleFamily · Active · 357 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,199/mo
• Mortgage (P&I): −$2,072
• Tax + insurance: −$659
• HOA: −$400
• Vac / Maint / Mgmt: −$462
• Net cashflow: $-1,394/mo
• Annual: $-16,726/yr
• Cap rate: 2.06%
• Cash-on-cash: -15.12%
• DSCR: 0.33
• 1% rule: 0.56%
• Cash to close: $110,651

Investor read

• This is a 3-bed/2.0-bath single-family listed at $32k.
• At list price, monthly cash flow is $-1k ($-17k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $32k).
• It's been on market 357 days — a 12% lower offer ($28k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $28k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#542 in MO) — a working-class tenant base; expect higher turnover. Strengths: housing A+, cost of living A, crime B+; Watch: schools C-, amenities F, commute F.
• Festus R-VI (suburban): math 55% / reading 64% proficiency, ranked #16 of 324 in MO (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: property tax is 18.8% of price.
• Market conditions: 58 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 807 units permitted in Jefferson County in 2024 (104 in 5+ unit buildings).
• Cap rate 2.1% vs local median 3.9% in Herculaneum — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.

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 357 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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.