2116 Magazine St Unit A & B

Gulf Hills, MS 39564

$299,000C

6 bd · 6.0 ba · 2,970 sqft · Built 2009 · MultiFamily · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,303/mo
• Mortgage (P&I): −$1,568
• Tax + insurance: −$498
• HOA: −$45
• Vac / Maint / Mgmt: −$694
• Net cashflow: $498/mo
• Annual: $5,977/yr
• Cap rate: 8.29%
• Cash-on-cash: 7.14%
• DSCR: 1.32
• 1% rule: 1.10%
• Cash to close: $83,720

Investor read

• This is a 2 × 3-bed/3.0-bath units multifamily listed at $299k. Condition is rated good.
• At list price, monthly cash flow is $498 ($6k/yr) — positive. Per door: $249/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $299k).
• It's been on market 23 days — a 2% lower offer ($295k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $295k (1.5% 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 $9k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#38 in MS) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment D+, amenities F, commute F.
• Jackson County School District (rural): math 53% / reading 48% proficiency, ranked #10 of 130 in MS (top 8%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: St Martin East Elementary School (math 67% / reading 57%, grade B, #18 of 375 statewide, top 5%, 685 students, 100% FRL); St. Martin Middle School (math 44% / reading 39%, grade F, #53 of 179 statewide, top 30%, 995 students, 100% FRL); St Martin High School (math 65% / reading 49%, grade C, #8 of 197 statewide, top 4%, 1,283 students, 100% FRL) — zoned schools average 100% FRL vs 50% district-wide (50 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+1.3%/yr); 714 active listings in the ZIP; solid renter incomes; 516 units permitted in Jackson County in 2024 (6 in 5+ unit buildings).
• 2 sale attempts since 4y ago; this cycle's ask has dropped $16k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.3% vs local median 4.5% in Gulf Hills — 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.
• At $3,303/mo this rent would consume 50% of the median local household income ($79k/yr) (locally 734% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.