The Pattison Plan

Alabaster, AL 35007

$304,900F

4 bd · 2.5 ba · 1,652 sqft · Built — · SingleFamily · Active · 55 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,273/mo
• Mortgage (P&I): −$2,033
• Tax + insurance: −$646
• HOA: −$0
• Vac / Maint / Mgmt: −$477
• Net cashflow: $-884/mo
• Annual: $-10,602/yr
• Cap rate: 3.56%
• Cash-on-cash: -9.77%
• DSCR: 0.57
• 1% rule: 0.59%
• Cash to close: $108,555

Investor read

• This is a 4-bed/2.5-bath single-family listed at $305k.
• At list price, monthly cash flow is $-884 ($-11k/yr) — negative.
• To cash-flow at today's rent, offer at most $260k (14.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $227k (25.4% below list).
• It's been on market 55 days — a 3% lower offer ($296k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $227k (25.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#14 in AL, #3,512 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, cost of living A+, housing A+; Watch: amenities D-, commute F, health & safety F.
• Alabaster City (suburban): math 30% / reading 57% proficiency, ranked #17 of 129 in AL (top 13%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.2%/yr); 226 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 987 units permitted in Shelby County in 2024 (0 in 5+ unit buildings).
• Shelby County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major wind risk, 43% 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.
• This rent runs 31% of the median local income ($89k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 55 days. Have you received any prior offers? Is the seller open to a 25% concession, seller financing, or rate buy-down credit?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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.
• 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.