740 Coliseum Blvd

Montgomery, AL 36109

$975,000C+

None bd · 1.0 ba · 5,250 sqft · Built 1986 · MultiFamily · Active · 75 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $12,015/mo
• Mortgage (P&I): −$5,113
• Tax + insurance: −$924
• HOA: −$0
• Vac / Maint / Mgmt: −$2,523
• Net cashflow: $3,455/mo
• Annual: $41,463/yr
• Cap rate: 10.55%
• Cash-on-cash: 15.19%
• DSCR: 1.68
• 1% rule: 1.23%
• Cash to close: $273,000

Investor read

• This is a 12 × 2-bed/1-bath units multifamily listed at $975k.
• At list price, monthly cash flow is $3k ($41k/yr) — positive. Per door: $288/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($12k rent vs $975k).
• It's been on market 75 days — a 6% lower offer ($916k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $916k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $7k of loan paydown is wiped out by about $29k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#138 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools C-, employment D, crime F.
• Montgomery County (urban): math 9% / reading 31% proficiency, ranked #106 of 129 in AL (top 82%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 70% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising (+2.6%/yr); 209 active listings in the ZIP; 460 units permitted in Montgomery County in 2024 (37 in 5+ unit buildings).
• Montgomery County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 5 sale attempts since 2y 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.
• Current owner paid $660k; 48% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 2.6% rent growth), your $273k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% 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 10.5% vs local median 6.0% in Montgomery — 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 $12,015/mo this rent would consume 244% of the median local household income ($59k/yr) (locally 1039% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 75 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• 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.
• 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.