412 W Orange St

Troy, AL 36081

$120,000B

3 bd · 1.0 ba · 1,696 sqft · Built 1948 · SingleFamily · Pending · 19 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,730/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$157
• HOA: −$0
• Vac / Maint / Mgmt: −$363
• Net cashflow: $580/mo
• Annual: $6,961/yr
• Cap rate: 12.09%
• Cash-on-cash: 20.72%
• DSCR: 1.92
• 1% rule: 1.44%
• Cash to close: $33,600

Investor read

• This is a 3-bed/1.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $580 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $120k).
• It's been on market 19 days — a 2% lower offer ($118k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $118k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $830 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#148 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing B; Watch: amenities C-, schools D, crime F.
• Troy City (rural): math 21% / reading 36% proficiency, ranked #80 of 129 in AL (top 62%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 26 active listings in the ZIP; 2 comparable units currently listed for rent nearby; lower-income renter base — watch delinquency; 42 units permitted in Pike County in 2024 (0 in 5+ unit buildings).
• Pike County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $34k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 90% chance of damaging wind over 30y; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.1% vs local median 2.0% in Troy — 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.
• At $1,730/mo this rent would consume 47% of the median local household income ($44k/yr) (locally 934% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1948 — 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 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?
• 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.