5471 Drexel Dr

Theodore, AL 36582

$199,500C-

3 bd · 2.0 ba · 1,225 sqft · Built 2004 · SingleFamily · Pending · 26 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,844/mo
• Mortgage (P&I): −$1,046
• Tax + insurance: −$134
• HOA: −$0
• Vac / Maint / Mgmt: −$387
• Net cashflow: $276/mo
• Annual: $3,316/yr
• Cap rate: 7.96%
• Cash-on-cash: 5.94%
• DSCR: 1.26
• 1% rule: 0.92%
• Cash to close: $55,860

Investor read

• This is a 3-bed/2.0-bath single-family listed at $200k.
• At list price, monthly cash flow is $276 ($3k/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 $184k (7.6% below list).
• It's been on market 26 days — a 2% lower offer ($197k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $184k (7.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#145 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Mobile County (urban): math 15% / reading 39% proficiency, ranked #81 of 129 in AL (top 63%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Mary W Burroughs Elementary School (math 2% / reading 32%, grade F, #486 of 627 statewide, top 79%, 390 students, 85% FRL); Theodore High School (math 10% / reading 12%, grade F, #247 of 305 statewide, top 81%, 1,280 students, 60% FRL) — zoned schools at 72% FRL track the district average.
• Zoned-school proficiency averages 14% at this address vs 27% district-wide (-13 pts) — the specific schools serving this property underperform the Mobile County average; the district grade overstates school quality for this exact location.
• Market conditions: 250 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 1,678 units permitted in Mobile County in 2024 (264 in 5+ unit buildings).
• Mobile County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 4y 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 $165k; 21% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.0% vs local median 5.0% in Theodore — 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.
• This rent runs 34% of the median local income ($65k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 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?
• 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.