Warbler Plan

Huntsville, AL 35763

$107,600F

2 bd · 2.0 ba · 910 sqft · Built — · SingleFamily · Active · 730 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,412/mo
• Mortgage (P&I): −$1,381
• Tax + insurance: −$439
• HOA: −$450
• Vac / Maint / Mgmt: −$297
• Net cashflow: $-1,154/mo
• Annual: $-13,848/yr
• Cap rate: 1.03%
• Cash-on-cash: -18.78%
• DSCR: 0.16
• 1% rule: 0.54%
• Cash to close: $73,723

Investor read

• This is a 2-bed/2.0-bath single-family listed at $108k. Condition is rated poor.
• At list price, monthly cash flow is $-1k ($-14k/yr) — negative.
• To cash-flow at today's rent, offer at most $96k (10.5% below list).
• Meets the 1% rule at list price ($1k rent vs $108k).
• It's been on market 730 days — a 12% lower offer ($95k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $95k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#3 in AL, #1,082 nationally) — a professional / high-income tenant draw. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F.
• Madison County (rural): math 27% / reading 56% proficiency, ranked #19 of 129 in AL (top 15%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Madison County Elementary School (math 17% / reading 47%, grade F, #331 of 627 statewide, top 57%, 412 students, 59% FRL); Madison County High School (math 32% / reading 42%, grade F, #39 of 305 statewide, top 13%, 483 students, 35% FRL) — zoned schools average 47% FRL vs 29% district-wide (18 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 3.7% of price; HOA is 32% of rent.
• Market conditions: Rents rising (+3.5%/yr); 433 active listings in the ZIP; high-income renter base; 4,709 units permitted in Madison County in 2024 (1,186 in 5+ unit buildings).
• Madison County population projected at +18% 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 1.0% vs local median 3.8% in Huntsville — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent is only 14% of the median local income ($123k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 730 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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?

Repairs flagged (vision-AI assessment)

• Major: Kitchen appliances — Old and worn, need replacement.
• Major: Bathroom fixtures — Outdated and worn, need replacement.
• Major: Flooring — Worn and damaged, need replacement.
• Major: Paint — Peeling and uneven, needs repainting.
• Major: Siding — Weathered and may need repainting or replacement.
• Major: Windows — Worn and may need replacement.