1104 Hanging Lantern Cir

Mobile, AL 36695

$325,575D

4 bd · 2.5 ba · 2,335 sqft · Built 1987 · SingleFamily · Active · 67 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,442/mo
• Mortgage (P&I): −$1,707
• Tax + insurance: −$269
• HOA: −$7
• Vac / Maint / Mgmt: −$513
• Net cashflow: $-54/mo
• Annual: $-653/yr
• Cap rate: 6.09%
• Cash-on-cash: -0.72%
• DSCR: 0.97
• 1% rule: 0.75%
• Cash to close: $91,161

Investor read

• This is a 4-bed/2.5-bath single-family listed at $326k.
• At list price, monthly cash flow is $-54 ($-653/yr) — negative.
• To cash-flow at today's rent, offer at most $316k (3.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $244k (25.0% below list).
• It's been on market 67 days — a 6% lower offer ($306k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $244k (25.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#20 in AL, #4,262 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F, employment D-.
• Mobile County (urban): math 15% / reading 39% proficiency, ranked #81 of 129 in AL (top 63%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Er Dickson Elementary School (math 12% / reading 40%, grade F, #409 of 627 statewide, top 65%, 1,038 students, 67% FRL); Denton Magnet School of Technology (math 26% / reading 69%, grade C-, #32 of 257 statewide, top 12%, 314 students, 94% FRL); Wp Davidson High School (math 36% / reading 41%, grade F, #37 of 305 statewide, top 12%, 1,535 students, 61% FRL).
• Market conditions: Rents soft (-0.4%/yr); 557 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 1,678 units permitted in Mobile County in 2024 (264 in 5+ unit buildings).
• Mobile County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 4y ago; this cycle's ask has dropped $53k (14%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $280k; 16% 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→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 4.9% in Mobile — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• This rent runs 39% of the median local income ($76k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 67 days. Have you received any prior offers? Is the seller open to a 25% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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?
• 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?