507 E Presnell St

Asheboro, NC 27203

$119,900C-

2 bd · 1.0 ba · 1,332 sqft · Built 1945 · SingleFamily · Pending · 14 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,181/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$107
• HOA: −$0
• Vac / Maint / Mgmt: −$248
• Net cashflow: $198/mo
• Annual: $2,375/yr
• Cap rate: 8.27%
• Cash-on-cash: 7.08%
• DSCR: 1.31
• 1% rule: 0.99%
• Cash to close: $33,572

Investor read

• This is a 2-bed/1.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $198 ($2k/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 $118k (1.5% below list).
• Only 14 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $118k (1.5% below list) — sets the bar for 1% rule.
• 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 72/100 on livability (#85 in NC) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A; Watch: schools F, crime F, amenities F.
• Asheboro City Schools (town): math 29% / reading 33% proficiency, ranked #145 of 178 in NC (top 82%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 64% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.8%/yr); 91 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 789 units permitted in Randolph County in 2024 (168 in 5+ unit buildings).
• Randolph County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts 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 $43k; list at $120k implies a 179% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.3% vs local median 2.9% in Asheboro — 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 31% 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 1945 — 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.