400 Perry St

Andalusia, AL 36420

$89,900B-

2 bd · 1.0 ba · 1,177 sqft · Built 1945 · SingleFamily · Active · 242 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $991/mo
• Mortgage (P&I): −$471
• Tax + insurance: −$96
• HOA: −$0
• Vac / Maint / Mgmt: −$208
• Net cashflow: $216/mo
• Annual: $2,587/yr
• Cap rate: 9.17%
• Cash-on-cash: 10.28%
• DSCR: 1.46
• 1% rule: 1.10%
• Cash to close: $25,172

Investor read

• This is a 2-bed/1.0-bath single-family listed at $90k.
• At list price, monthly cash flow is $216 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($991 rent vs $90k).
• It's been on market 242 days — a 12% lower offer ($79k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $79k (12.0% below list) — sets the bar for market timing.
• In year one you build about $7k of equity ($622 loan paydown + $6k appreciation (6.8% local appreciation)).
• Location reads 65/100 on livability (#142 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime F, amenities F, commute F.
• Andalusia City (town): math 29% / reading 48% proficiency, ranked #35 of 129 in AL (top 27%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Andalusia Elementary School (math 29% / reading 53%, grade F, #233 of 627 statewide, top 38%, 1,126 students, 63% FRL); Andalusia Junior High (math 30% / reading 46%, grade F, #69 of 257 statewide, top 27%, 248 students, 75% FRL); Andalusia High School (math 27% / reading 37%, grade F, #59 of 305 statewide, top 21%, 497 students, 61% FRL).
• Watch-outs: built in 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 87 active listings in the ZIP; 13 units permitted in Covington County in 2024 (0 in 5+ unit buildings).
• Covington County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts; this cycle's ask has dropped $8k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (6.8% appreciation + 3.0% rent growth), your $25k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 6, paydown + projected appreciation supports a ~$37k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 99% 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.
• Cap rate 9.2% vs local median 4.1% in Andalusia — 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 242 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1945 — 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 D-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.