701 McRae St

Atmore, AL 36502

$169,500C

3 bd · 1.0 ba · 1,051 sqft · Built 1979 · SingleFamily · Pending · 274 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,559/mo
• Mortgage (P&I): −$889
• Tax + insurance: −$114
• HOA: −$0
• Vac / Maint / Mgmt: −$327
• Net cashflow: $229/mo
• Annual: $2,752/yr
• Cap rate: 7.92%
• Cash-on-cash: 5.80%
• DSCR: 1.26
• 1% rule: 0.92%
• Cash to close: $47,460

Investor read

• This is a 3-bed/1.0-bath single-family listed at $170k.
• At list price, monthly cash flow is $229 ($3k/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 $156k (8.0% below list).
• It's been on market 274 days — a 12% lower offer ($149k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $149k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 50/100 on livability (#530 in AL) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+; Watch: schools F, crime F, amenities F.
• Escambia County (town): math 17% / reading 39% proficiency, ranked #83 of 129 in AL (top 64%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 70% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 115 active listings in the ZIP; 18 units permitted in Escambia County in 2024 (0 in 5+ unit buildings).
• Escambia County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 4 sale attempts since 5y ago; this cycle's ask has dropped $16k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $125k; 36% 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→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 274 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1979 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 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.