1612 S Montgomery Ave

Sedalia, MO 65301

$97,900B

2 bd · 1.0 ba · 924 sqft · Built 1915 · SingleFamily · Pending · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,109/mo
• Mortgage (P&I): −$513
• Tax + insurance: −$72
• HOA: −$0
• Vac / Maint / Mgmt: −$233
• Net cashflow: $291/mo
• Annual: $3,494/yr
• Cap rate: 9.86%
• Cash-on-cash: 12.75%
• DSCR: 1.57
• 1% rule: 1.13%
• Cash to close: $27,412

Investor read

• This is a 2-bed/1.0-bath single-family listed at $98k.
• At list price, monthly cash flow is $291 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $98k).
• It's been on market 22 days — a 2% lower offer ($96k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $677 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#107 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities D, crime F, commute F.
• Sedalia 200 (town): math 47% / reading 46% proficiency, ranked #89 of 324 in MO (top 28%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1915 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 213 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 109 units permitted in Pettis County in 2024 (46 in 5+ unit buildings).
• Pettis County population projected to shrink 7% 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 $32k (25%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $27k cash investment doubles in ~9 years — after that, you're playing with house money.
• Cap rate 9.9% vs local median 4.3% in Sedalia — 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

• Built in 1915 — 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.
• 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.