424 Georgia Ave

Ferguson, MO 63135

$89,200C+

2 bd · 1.0 ba · 822 sqft · Built 1935 · SingleFamily · Pending · 35 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,237/mo
• Mortgage (P&I): −$468
• Tax + insurance: −$110
• HOA: −$0
• Vac / Maint / Mgmt: −$260
• Net cashflow: $400/mo
• Annual: $4,796/yr
• Cap rate: 11.67%
• Cash-on-cash: 19.20%
• DSCR: 1.85
• 1% rule: 1.39%
• Cash to close: $24,976

Investor read

• This is a 2-bed/1.0-bath single-family listed at $89k.
• At list price, monthly cash flow is $400 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $89k).
• It's been on market 35 days — a 3% lower offer ($87k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $87k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $617 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#586 in MO) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing B+; Watch: health & safety C-, schools F, crime F.
• Ferguson-Florissant R-II (suburban): math 7% / reading 20% proficiency, ranked #311 of 324 in MO (top 96%) — 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.
• Watch-outs: built in 1935 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.0%/yr); 162 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 920 units permitted in St. Louis County in 2024 (250 in 5+ unit buildings).
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $25k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: moderate flood risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.7% vs local median 9.2% in Ferguson — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

Questions for listing agent

• It's been on market 35 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1935 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.