1947 Spencer Ave

Overland, MO 63114

$55,000B+

1 bd · 1.0 ba · 480 sqft · Built 1956 · SingleFamily · Pending · 82 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $954/mo
• Mortgage (P&I): −$288
• Tax + insurance: −$90
• HOA: −$0
• Vac / Maint / Mgmt: −$200
• Net cashflow: $375/mo
• Annual: $4,501/yr
• Cap rate: 14.48%
• Cash-on-cash: 29.23%
• DSCR: 2.30
• 1% rule: 1.73%
• Cash to close: $15,400

Investor read

• This is a 1-bed/1.0-bath single-family listed at $55k.
• At list price, monthly cash flow is $375 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($954 rent vs $55k).
• It's been on market 82 days — a 6% lower offer ($52k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $52k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $380 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 61/100 on livability (#436 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety C-, schools F, crime F.
• Ritenour (suburban): math 13% / reading 27% proficiency, ranked #304 of 324 in MO (top 94%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1956 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.0%/yr); 118 active listings in the ZIP; 920 units permitted in St. Louis County in 2024 (250 in 5+ unit buildings).
• 3 sale attempts; this cycle's ask has dropped $15k (21%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $30k; list at $55k implies a 83% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.0% rent growth), your $15k cash investment doubles in ~5 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 14.5% vs local median 6.2% in Overland — 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 82 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1956 — 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?
• 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.