3220 S 16th St

Fort Smith, AR 72901

$75,000B-

3 bd · 1.0 ba · 1,104 sqft · Built 1988 · SingleFamily · Pending · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $956/mo
• Mortgage (P&I): −$393
• Tax + insurance: −$125
• HOA: −$0
• Vac / Maint / Mgmt: −$201
• Net cashflow: $237/mo
• Annual: $2,842/yr
• Cap rate: 10.08%
• Cash-on-cash: 13.53%
• DSCR: 1.60
• 1% rule: 1.27%
• Cash to close: $21,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $75k.
• At list price, monthly cash flow is $237 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($956 rent vs $75k).
• It's been on market 15 days — a 2% lower offer ($74k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $74k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $519 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#151 in AR) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime F, amenities F, commute F.
• Fort Smith School District (urban): math 35% / reading 39% proficiency, ranked #106 of 238 in AR (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 64% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Fairview Elementary School (math 50% / reading 38%, grade F, #164 of 454 statewide, top 37%, 458 students, 77% FRL); Ramsey Junior High School (math 37% / reading 47%, grade D-, #78 of 201 statewide, top 40%, 832 students, 67% FRL); Southside High School (math 36% / reading 53%, grade F, #31 of 292 statewide, top 12%, 1,956 students, 47% FRL) — zoned schools at 64% FRL track the district average.
• Market conditions: Rents rising fast (+4.4%/yr); 176 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 388 units permitted in Sebastian County in 2024 (16 in 5+ unit buildings).
• Sebastian County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 9y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $60k; 25% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 4.4% rent growth), your $21k cash investment doubles in ~8 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.1% vs local median 4.3% in Fort Smith — 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

• 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?
• 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?
• 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.