135 Rugby Dr

Madison, AL 35758

$325,000D-

3 bd · 1.0 ba · 1,899 sqft · Built 2022 · Townhouse · Active · 91 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,841/mo
• Mortgage (P&I): −$1,704
• Tax + insurance: −$516
• HOA: −$150
• Vac / Maint / Mgmt: −$387
• Net cashflow: $-916/mo
• Annual: $-10,993/yr
• Cap rate: 2.91%
• Cash-on-cash: -12.08%
• DSCR: 0.46
• 1% rule: 0.57%
• Cash to close: $91,000

Investor read

• This is a 3-bed/1.0-bath townhouse listed at $325k.
• At list price, monthly cash flow is $-916 ($-11k/yr) — negative.
• To cash-flow at today's rent, offer at most $163k (49.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $184k (43.3% below list).
• It's been on market 91 days — a 9% lower offer ($296k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $163k (49.8% below list) — sets the bar for cash-flow.
• In year one you build about $35k of equity ($2k loan paydown + $32k appreciation (10.0% local appreciation)).
• Location reads 76/100 on livability (#12 in AL, #3,280 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, schools A; Watch: amenities F, commute F.
• Madison City (suburban): math 51% / reading 71% proficiency, ranked #4 of 129 in AL (top 3%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 17% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+1.6%/yr); 382 active listings in the ZIP; 33 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 42% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 4,709 units permitted in Madison County in 2024 (1,186 in 5+ unit buildings).
• Madison County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 2, paydown + projected appreciation supports a ~$56k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 91 days. Have you received any prior offers? Is the seller open to a 50% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.