224 S Spring St

Madisonville, KY 42431

$87,500D

1 bd · 1.0 ba · 598 sqft · Built — · SingleFamily · Active · 73 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $808/mo
• Mortgage (P&I): −$459
• Tax + insurance: −$146
• HOA: −$0
• Vac / Maint / Mgmt: −$170
• Net cashflow: $34/mo
• Annual: $404/yr
• Cap rate: 6.75%
• Cash-on-cash: 1.65%
• DSCR: 1.07
• 1% rule: 0.92%
• Cash to close: $24,500

Investor read

• This is a 1-bed/1.0-bath single-family listed at $88k.
• At list price, monthly cash flow is $34 ($404/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 $81k (7.6% below list).
• It's been on market 73 days — a 6% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $81k (7.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $605 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#132 in KY) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, employment F.
• Hopkins County (town): math 27% / reading 43% proficiency, ranked #65 of 165 in KY (top 39%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: West Broadway Elementary School (math 37% / reading 47%, grade F, #178 of 676 statewide, top 29%, 358 students, 60% FRL); Browning Springs Middle School (math 18% / reading 40%, grade F, #156 of 217 statewide, top 74%, 499 students, 63% FRL); Madisonville North Hopkins High School (math 30% / reading 38%, grade F, #89 of 254 statewide, top 36%, 1,189 students, 46% FRL) — zoned schools at 56% FRL track the district average.
• Market conditions: 193 active listings in the ZIP; 122 units permitted in Hopkins County in 2024 (0 in 5+ unit buildings).
• Hopkins County population projected at -13% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 4 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 $48k; list at $88k implies a 83% gain — meaningful room to come down on a strong offer.
• 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 6.8% vs local median 4.0% in Madisonville — 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.

Questions for listing agent

• It's been on market 73 days. Have you received any prior offers? Is the seller open to a 8% concession, seller financing, or rate buy-down credit?
• 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.
• 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?
• 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.