RC Carlie II Plan

Calera, AL 35040

$220,000F

3 bd · 2.0 ba · 1,012 sqft · Built — · SingleFamily · Active · 220 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,767/mo
• Mortgage (P&I): −$1,286
• Tax + insurance: −$409
• HOA: −$0
• Vac / Maint / Mgmt: −$371
• Net cashflow: $-298/mo
• Annual: $-3,579/yr
• Cap rate: 4.83%
• Cash-on-cash: -5.21%
• DSCR: 0.77
• 1% rule: 0.72%
• Cash to close: $68,641

Investor read

• This is a 3-bed/2.0-bath single-family listed at $220k. Condition is rated good.
• At list price, monthly cash flow is $-298 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $202k (8.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $177k (19.7% below list).
• It's been on market 220 days — a 12% lower offer ($194k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $177k (19.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#325 in AL) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+, employment A-; Watch: amenities F, commute F, health & safety F.
• Shelby County (suburban): math 30% / reading 58% proficiency, ranked #16 of 129 in AL (top 12%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Calera Intermediate School (math 22% / reading 46%, grade F, #311 of 627 statewide, top 50%, 766 students, 68% FRL); Calera Middle (math 9% / reading 45%, grade F, #147 of 257 statewide, top 58%, 755 students, 61% FRL); Calera High (math 18% / reading 21%, grade F, #169 of 305 statewide, top 59%, 1,066 students, 59% FRL) — zoned schools average 63% FRL vs 26% district-wide (37 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 27% at this address vs 44% district-wide (-17 pts) — the specific schools serving this property underperform the Shelby County average; the district grade overstates school quality for this exact location.
• Market conditions: Rents rising (+3.7%/yr); 471 active listings in the ZIP; 17 comparable units currently listed for rent nearby; rentals lingering (median 86d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 71% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 987 units permitted in Shelby County in 2024 (0 in 5+ unit buildings).
• Shelby County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major wind risk, 55% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 220 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• 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?
• 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.