523 Tennessee St

Florence, AL 35630

$119,900B-

3 bd · 1.0 ba · 1,260 sqft · Built 1960 · SingleFamily · Active · 7 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,216/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$90
• HOA: −$0
• Vac / Maint / Mgmt: −$255
• Net cashflow: $242/mo
• Annual: $2,909/yr
• Cap rate: 8.72%
• Cash-on-cash: 8.66%
• DSCR: 1.39
• 1% rule: 1.01%
• Cash to close: $33,572

Investor read

• This is a 3-bed/1.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $242 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $120k).
• Only 7 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $829 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#4 in AL, #1,140 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime F, employment F.
• Florence City (urban): math 28% / reading 44% proficiency, ranked #44 of 129 in AL (top 34%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Florence Middle School (math 22% / reading 44%, grade F, #101 of 257 statewide, top 40%, 689 students, 51% FRL); Florence High School (math 28% / reading 34%, grade F, #66 of 305 statewide, top 21%, 1,034 students, 36% FRL).
• Market conditions: Rents rising fast (+6.2%/yr); 268 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 164 units permitted in Lauderdale County in 2024 (72 in 5+ unit buildings).
• 3 sale attempts since 12y 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 $38k; list at $120k implies a 216% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 6.2% rent growth), your $34k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.7% vs local median 3.6% in Florence — 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.
• This rent runs 32% of the median local income ($46k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1960 — 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.
• 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.