3221 25th St N

Birmingham, AL 35207

$95,000C+

3 bd · 1.0 ba · 1,056 sqft · Built 1985 · SingleFamily · Pending · 7 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $996/mo
• Mortgage (P&I): −$498
• Tax + insurance: −$110
• HOA: −$0
• Vac / Maint / Mgmt: −$209
• Net cashflow: $178/mo
• Annual: $2,136/yr
• Cap rate: 8.54%
• Cash-on-cash: 8.03%
• DSCR: 1.36
• 1% rule: 1.05%
• Cash to close: $26,600

Investor read

• This is a 3-bed/1.0-bath single-family listed at $95k.
• At list price, monthly cash flow is $178 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($996 rent vs $95k).
• Only 7 days on market — expect competitive offers; lowballing is unlikely to land.
• In year one you build about $10k of equity ($657 loan paydown + $10k appreciation (10.0% local appreciation)).
• Location reads 67/100 on livability (#78 in AL) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities C-, crime F, employment F.
• Birmingham City (urban): math 4% / reading 20% proficiency, ranked #116 of 129 in AL (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 82% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Hudson Keight School (math 0% / reading 7%, grade F, #627 of 627 statewide, top 100%, 633 students, 94% FRL); George Washington Carver High School (math 2% / reading 17%, grade F, #252 of 305 statewide, top 84%, 531 students, 87% FRL).
• Market conditions: 42 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 2,114 units permitted in Jefferson County in 2024 (556 in 5+ unit buildings).
• Jefferson County population projected to shrink 4% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 3y 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 $64k; 50% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $27k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$36k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; 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 6.2% in Birmingham — 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

• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-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.