87 Red Wing Rd

South Wallins, KY 40873

$39,900B-

3 bd · 1.0 ba · 1,080 sqft · Built — · Other · Active · 184 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,051/mo
• Mortgage (P&I): −$209
• Tax + insurance: −$89
• HOA: −$0
• Vac / Maint / Mgmt: −$221
• Net cashflow: $532/mo
• Annual: $6,384/yr
• Cap rate: 23.96%
• Cash-on-cash: 63.11%
• DSCR: 3.81
• 1% rule: 2.63%
• Cash to close: $11,172

Investor read

• This is a 3-bed/1.0-bath other listed at $40k.
• At list price, monthly cash flow is $532 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $40k).
• It's been on market 184 days — a 12% lower offer ($35k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $35k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $276 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 51/100 on livability (#502 in KY) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, crime A, housing A-; Watch: schools D-, amenities F, commute F.
• Harlan County (rural): math 16% / reading 35% proficiency, ranked #149 of 165 in KY (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 65% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $56/mo.
• Market conditions: 13 active listings in the ZIP.
• Harlan County population projected at -34% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 4 sale attempts since 9y ago; this cycle's ask has dropped $30k (43%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $11k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk; moderate wildfire risk; extreme-heat days projected 8→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 184 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?
• 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.