514 S 2nd St

De Soto, MO 63020

$130,000F

2 bd · 1.0 ba · 432 sqft · Built 1930 · Other · Active · 37 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $927/mo
• Mortgage (P&I): −$682
• Tax + insurance: −$118
• HOA: −$0
• Vac / Maint / Mgmt: −$195
• Net cashflow: $-67/mo
• Annual: $-809/yr
• Cap rate: 5.67%
• Cash-on-cash: -2.22%
• DSCR: 0.90
• 1% rule: 0.71%
• Cash to close: $36,400

Investor read

• This is a 2-bed/1.0-bath other listed at $130k.
• At list price, monthly cash flow is $-67 ($-809/yr) — negative.
• To cash-flow at today's rent, offer at most $118k (9.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $93k (28.7% below list).
• It's been on market 37 days — a 3% lower offer ($126k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $93k (28.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $899 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#523 in MO) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: crime F, amenities F, commute F.
• Desoto 73 (town): math 36% / reading 43% proficiency, ranked #153 of 324 in MO (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Vineland Elem. (math 40% / reading 44%, grade F, #481 of 1,115 statewide, top 46%, 648 students, 49% FRL); Desoto Jr. High (math 33% / reading 41%, grade F, #220 of 391 statewide, top 59%, 381 students, 46% FRL); Desoto Sr. High (math 37% / reading 53%, grade D-, #176 of 521 statewide, top 34%, 848 students, 34% FRL) — zoned schools at 43% FRL track the district average.
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 152 active listings in the ZIP; 807 units permitted in Jefferson County in 2024 (104 in 5+ unit buildings).
• 2 sale attempts since 5y 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.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 3.7% in De Soto — 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

• 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 37 days. Have you received any prior offers? Is the seller open to a 29% concession, seller financing, or rate buy-down credit?
• Built in 1930 — 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?
• 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.