1707 Dorrough Ave

Leeds, AL 35094

$40,999B-

3 bd · 1.0 ba · 886 sqft · Built 1940 · SingleFamily · Active · 480 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,176/mo
• Mortgage (P&I): −$215
• Tax + insurance: −$73
• HOA: −$0
• Vac / Maint / Mgmt: −$247
• Net cashflow: $641/mo
• Annual: $7,696/yr
• Cap rate: 25.06%
• Cash-on-cash: 67.04%
• DSCR: 3.98
• 1% rule: 2.87%
• Cash to close: $11,480

Investor read

• This is a 3-bed/1.0-bath single-family listed at $41k.
• At list price, monthly cash flow is $641 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $41k).
• It's been on market 480 days — a 12% lower offer ($36k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $36k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $283 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#286 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, employment B+; Watch: crime D+, amenities F, commute F.
• Leeds City (suburban): math 20% / reading 45% proficiency, ranked #51 of 129 in AL (top 40%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Leeds Elementary School (math 33% / reading 49%, grade F, #233 of 627 statewide, top 38%, 625 students, 59% FRL); Leeds Middle School (math 9% / reading 47%, grade F, #141 of 257 statewide, top 55%, 470 students, 62% FRL); Leeds High School (math 17% / reading 22%, grade F, #169 of 305 statewide, top 59%, 619 students, 52% FRL).
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 161 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 18d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 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; this cycle's ask has dropped $79k (66%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $10k; list at $41k implies a 332% gain — meaningful room to come down on a strong offer.
• 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: 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.
• Cap rate 25.1% vs local median 4.2% in Leeds — 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 480 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1940 — 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.
• Crime grade is D 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.
• 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.