9423 Gate Nine Cutoff

Fort Smith, AR 72916

$167,000C

3 bd · 1.5 ba · 1,284 sqft · Built — · SingleFamily · Active · 344 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,663/mo
• Mortgage (P&I): −$876
• Tax + insurance: −$134
• HOA: −$0
• Vac / Maint / Mgmt: −$349
• Net cashflow: $304/mo
• Annual: $3,649/yr
• Cap rate: 8.48%
• Cash-on-cash: 7.80%
• DSCR: 1.35
• 1% rule: 1.00%
• Cash to close: $46,760

Investor read

• This is a 3-bed/1.5-bath single-family listed at $167k.
• At list price, monthly cash flow is $304 ($4k/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 $166k (0.4% below list).
• It's been on market 344 days — a 12% lower offer ($147k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $147k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#151 in AR) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D, crime F, amenities F.
• Greenwood School District (town): math 59% / reading 58% proficiency, ranked #5 of 238 in AR (top 2%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising (+1.6%/yr); 235 active listings in the ZIP; solid renter incomes; 388 units permitted in Sebastian County in 2024 (16 in 5+ unit buildings).
• Sebastian County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 5y ago; this cycle's ask has dropped $11k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $117k; 43% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.5% vs local median 4.3% in Fort Smith — 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 344 days. Have you received any prior offers? Is the seller open to a 12% 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.
• 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.