324 3rd St

Tarrant, AL 35214

$7,000D

2 bd · 1.0 ba · 912 sqft · Built 1910 · SingleFamily · Active · 115 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,093/mo
• Mortgage (P&I): −$37
• Tax + insurance: −$13
• HOA: −$0
• Vac / Maint / Mgmt: −$230
• Net cashflow: $814/mo
• Annual: $9,767/yr
• Cap rate: 145.82%
• Cash-on-cash: 498.31%
• DSCR: 23.17
• 1% rule: 15.62%
• Cash to close: $1,960

Investor read

• This is a 2-bed/1.0-bath single-family listed at $7k.
• At list price, monthly cash flow is $814 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $7k).
• It's been on market 115 days — a 9% lower offer ($6k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $6k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $48 of loan paydown is wiped out by about $210 of value loss. Plan a longer hold.
• Location reads 51/100 on livability (#507 in AL) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: crime C-, schools F, amenities F.
• Tarrant City (suburban): math 4% / reading 17% proficiency, ranked #121 of 129 in AL (top 94%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 89% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 116 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 2d on market — plan ~1-2 weeks tenant-placement turnaround); 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.
• At projected returns (-3.0% appreciation + 0.7% rent growth), your $2k cash investment doubles in ~1 year — 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 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 145.8% vs local median 11.0% in Tarrant — 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

• It's been on market 115 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1910 — 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?
• 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.