15 12th Ave

Lake Lorraine, FL 32579

$265,000C-

3 bd · 2.0 ba · 1,631 sqft · Built 1983 · Townhouse · Active · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,146/mo
• Mortgage (P&I): −$1,390
• Tax + insurance: −$239
• HOA: −$0
• Vac / Maint / Mgmt: −$451
• Net cashflow: $67/mo
• Annual: $801/yr
• Cap rate: 6.60%
• Cash-on-cash: 1.08%
• DSCR: 1.05
• 1% rule: 0.81%
• Cash to close: $74,200

Investor read

• This is a 3-bed/2.0-bath townhouse listed at $265k.
• At list price, monthly cash flow is $67 ($801/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $215k (19.0% below list).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $215k (19.0% 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 $8k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#488 in FL) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: cost of living C-, health & safety C-, amenities F.
• Okaloosa (other): math 60% / reading 60% proficiency, ranked #12 of 73 in FL (top 16%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Shalimar Elementary School (math 54% / reading 61%, grade C+, #764 of 2,144 statewide, top 36%, 614 students, 63% FRL); Choctawhatchee Senior High School (math 42% / reading 50%, grade D-, #220 of 667 statewide, top 33%, 1,677 students, 52% FRL) — zoned schools average 58% FRL vs 36% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents soft (-2.0%/yr); 112 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 72% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 1,268 units permitted in Okaloosa County in 2024 (175 in 5+ unit buildings).
• Okaloosa County population projected at +37% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $228k; 16% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.6% vs local median 4.3% in Lake Lorraine — 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?
• 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.