533 10th Ct W

Birmingham, AL 35204

$38,000B

3 bd · 2.0 ba · 2,967 sqft · Built 1949 · SingleFamily · Pending · 12 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,339/mo
• Mortgage (P&I): −$199
• Tax + insurance: −$157
• HOA: −$0
• Vac / Maint / Mgmt: −$281
• Net cashflow: $702/mo
• Annual: $8,421/yr
• Cap rate: 28.45%
• Cash-on-cash: 79.14%
• DSCR: 4.52
• 1% rule: 3.52%
• Cash to close: $10,640

Investor read

• This is a 3-bed/2.0-bath single-family listed at $38k.
• At list price, monthly cash flow is $702 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $38k).
• Only 12 days on market — expect competitive offers; lowballing is unlikely to land.
• In year one you build about $507 of equity ($263 loan paydown + $244 appreciation (0.6% local appreciation)).
• Location reads 67/100 on livability (#78 in AL) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities C-, crime F, employment F.
• Birmingham City (urban): math 4% / reading 20% proficiency, ranked #116 of 129 in AL (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 82% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Parker High School (math 2% / reading 2%, grade F, #291 of 305 statewide, top 100%, 826 students, 90% FRL).
• Watch-outs: property tax is 4.5% of price; built in 1949 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 65 active listings in the ZIP; 1 comparable units currently listed for rent nearby; lower-income renter base — watch delinquency; 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.
• 3 sale attempts since 9y ago; this cycle's ask has dropped $2k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $17k; list at $38k implies a 124% gain — meaningful room to come down on a strong offer.
• At projected returns (0.6% 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 6→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 28.5% vs local median 6.2% in Birmingham — 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 $1,339/mo this rent would consume 45% of the median local household income ($35k/yr) (locally 422% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1949 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.