78 E Sycamore St

Fayetteville, AR 72703

$420,000D

3 bd · 2.5 ba · 2,560 sqft · Built 2002 · Condo · Active · 87 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,068/mo
• Mortgage (P&I): −$2,203
• Tax + insurance: −$475
• HOA: −$285
• Vac / Maint / Mgmt: −$644
• Net cashflow: $-538/mo
• Annual: $-6,457/yr
• Cap rate: 4.76%
• Cash-on-cash: -5.49%
• DSCR: 0.76
• 1% rule: 0.73%
• Cash to close: $117,600

Investor read

• This is a 3-bed/2.5-bath condo listed at $420k.
• At list price, monthly cash flow is $-538 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $325k (22.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $307k (26.9% below list).
• It's been on market 87 days — a 6% lower offer ($395k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $307k (26.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#3 in AR, #871 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, health & safety A+; Watch: employment D+, crime D-.
• Fayetteville School District (urban): math 50% / reading 49% proficiency, ranked #19 of 238 in AR (top 8%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.0%/yr); 309 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 3,494 units permitted in Washington County in 2024 (1,497 in 5+ unit buildings).
• Washington County population projected at +47% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 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 4.8% vs local median 3.5% in Fayetteville — 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.
• At $3,068/mo this rent would consume 61% of the median local household income ($61k/yr) (locally 2372% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 87 days. Have you received any prior offers? Is the seller open to a 27% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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?