509 W Fort Scott St

Butler, MO 64730

$40,000B+

4 bd · 1.0 ba · 1,382 sqft · Built 1940 · Other · Pending · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $801/mo
• Mortgage (P&I): −$210
• Tax + insurance: −$48
• HOA: −$0
• Vac / Maint / Mgmt: −$168
• Net cashflow: $375/mo
• Annual: $4,496/yr
• Cap rate: 17.53%
• Cash-on-cash: 40.15%
• DSCR: 2.79
• 1% rule: 2.00%
• Cash to close: $11,200

Investor read

• This is a 4-bed/1.0-bath other listed at $40k.
• At list price, monthly cash flow is $375 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($801 rent vs $40k).
• It's been on market 16 days — a 2% lower offer ($39k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $39k (1.5% below list) — sets the bar for market timing.
• In year one you build about $4k of equity ($277 loan paydown + $4k appreciation (10.0% local appreciation)).
• Location reads 63/100 on livability (#362 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A; Watch: schools D, crime F, amenities F.
• Butler R-V (town): math 28% / reading 41% proficiency, ranked #233 of 324 in MO (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 47 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 2 units permitted in Bates County in 2024 (0 in 5+ unit buildings).
• Bates County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $11k cash investment doubles in ~2 years — after that, you're playing with house money.
• By year 7, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 17.5% vs local median 2.2% in Butler — 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

• Built in 1940 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.