809 4th St W

Birmingham, AL 35204

$125,000D

2 bd · 1.0 ba · 918 sqft · Built 1915 · SingleFamily · Active · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $932/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$81
• HOA: −$0
• Vac / Maint / Mgmt: −$196
• Net cashflow: $0/mo
• Annual: $2/yr
• Cap rate: 6.29%
• Cash-on-cash: 0.00%
• DSCR: 1.00
• 1% rule: 0.75%
• Cash to close: $35,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $125k.
• At list price, monthly cash flow is $0 ($2/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $93k (25.4% below list).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $93k (25.4% below list) — sets the bar for 1% rule.
• In year one you build about $2k of equity ($864 loan paydown + $801 appreciation (0.6% local appreciation)).
• Location reads 67/100 on livability (#78 in AL) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities C-, crime F, employment F.
• Birmingham City (urban): math 4% / reading 20% proficiency, ranked #116 of 129 in AL (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 82% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Tuggle Elementary School (math 2% / reading 17%, grade F, #591 of 627 statewide, top 94%, 470 students, 87% FRL); Parker High School (math 2% / reading 2%, grade F, #291 of 305 statewide, top 100%, 826 students, 90% FRL).
• Watch-outs: built in 1915 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 65 active listings in the ZIP; 21 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 52% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 2,114 units permitted in Jefferson County in 2024 (556 in 5+ unit buildings).
• Jefferson County population projected to shrink 4% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 7y 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 $56k; list at $125k implies a 124% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• This rent runs 32% of the median local income ($35k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1915 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.
• 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.