705 E Main St

Cleveland, NC 27013

$195,000C

3 bd · 1.0 ba · 1,398 sqft · Built 1946 · SingleFamily · Active · 90 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,686/mo
• Mortgage (P&I): −$1,023
• Tax + insurance: −$218
• HOA: −$0
• Vac / Maint / Mgmt: −$354
• Net cashflow: $92/mo
• Annual: $1,099/yr
• Cap rate: 6.86%
• Cash-on-cash: 2.01%
• DSCR: 1.09
• 1% rule: 0.86%
• Cash to close: $54,600

Investor read

• This is a 3-bed/1.0-bath single-family listed at $195k.
• At list price, monthly cash flow is $92 ($1k/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 $169k (13.6% below list).
• It's been on market 90 days — a 6% lower offer ($183k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $169k (13.6% below list) — sets the bar for 1% rule.
• In year one you build about $15k of equity ($1k loan paydown + $13k appreciation (6.9% local appreciation)).
• Location reads 63/100 on livability (#428 in NC) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B+; Watch: schools D+, employment D+, amenities F.
• Rowan-Salisbury Schools (rural): math 26% / reading 35% proficiency, ranked #142 of 178 in NC (top 80%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1946 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 30 active listings in the ZIP; 592 units permitted in Rowan County in 2024 (5 in 5+ unit buildings).
• Rowan County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 3y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $165k; 18% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (6.9% appreciation + 3.0% rent growth), your $55k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$37k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→17/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 90 days. Have you received any prior offers? Is the seller open to a 14% concession, seller financing, or rate buy-down credit?
• Built in 1946 — 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 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.