2 Garden Ln

Monroe City, MO 63456

$139,000D

3 bd · 1.0 ba · 1,200 sqft · Built 1950 · Other · Pending · 30 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,006/mo
• Mortgage (P&I): −$729
• Tax + insurance: −$129
• HOA: −$0
• Vac / Maint / Mgmt: −$211
• Net cashflow: $-64/mo
• Annual: $-766/yr
• Cap rate: 5.74%
• Cash-on-cash: -1.97%
• DSCR: 0.91
• 1% rule: 0.72%
• Cash to close: $38,920

Investor read

• This is a 3-bed/1.0-bath other listed at $139k.
• At list price, monthly cash flow is $-64 ($-766/yr) — negative.
• To cash-flow at today's rent, offer at most $128k (8.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $101k (27.7% below list).
• It's been on market 30 days — a 2% lower offer ($137k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $101k (27.7% below list) — sets the bar for 1% rule.
• In year one you build about $6k of equity ($961 loan paydown + $5k appreciation (3.8% local appreciation)).
• Location reads 64/100 on livability (#303 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: employment C-, amenities F, commute F.
• Monroe City R-I (rural): math 47% / reading 50% proficiency, ranked #58 of 324 in MO (top 18%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Monroe City Elem. (math 57% / reading 47%, grade C-, #231 of 1,115 statewide, top 24%, 316 students, 57% FRL); Monroe City Middle (math 42% / reading 52%, grade D+, #95 of 391 statewide, top 25%, 191 students, 51% FRL); Monroe City R-I High (math 42% / reading 47%, grade F, #179 of 521 statewide, top 39%, 257 students, 37% FRL) — zoned schools at 48% FRL track the district average.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 63 active listings in the ZIP; 2 units permitted in Monroe County in 2024 (0 in 5+ unit buildings).
• Monroe County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (3.8% appreciation + 3.0% rent growth), your $39k cash investment doubles in ~6 years — after that, you're playing with house money.
• By year 6, paydown + projected appreciation supports a ~$33k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 5.7% vs local median 4.0% in Monroe City — 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

• 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?
• Built in 1950 — 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.
• 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.