1024 Walnut St

Gautier, MS 39564

$229,000D-

3 bd · 2.0 ba · 1,338 sqft · Built 1999 · SingleFamily · Pending · 14 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,824/mo
• Mortgage (P&I): −$1,201
• Tax + insurance: −$634
• HOA: −$0
• Vac / Maint / Mgmt: −$383
• Net cashflow: $-394/mo
• Annual: $-4,732/yr
• Cap rate: 6.46%
• Cash-on-cash: 0.60%
• DSCR: 1.03
• 1% rule: 0.80%
• Cash to close: $64,120

Investor read

• This is a 3-bed/2.0-bath single-family listed at $229k.
• At list price, monthly cash flow is $-394 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $159k (30.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $182k (20.4% below list).
• Only 14 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $159k (30.4% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#89 in MS) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety D+, employment D, amenities F.
• Ocean Springs School District (suburban): math 64% / reading 59% proficiency, ranked #1 of 130 in MS (top 1%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Pecan Park Elementary School (math 62% / reading 57%, grade B-, #27 of 375 statewide, top 8%, 530 students, 99% FRL); Ocean Springs Upper Elementary Scho (math 59% / reading 56%, grade B, #12 of 179 statewide, top 6%, 1,332 students, 100% FRL); Ocean Springs High School (math 77% / reading 64%, grade B+, #1 of 197 statewide, top 0%, 1,899 students, 100% FRL) — zoned schools average 100% FRL vs 33% district-wide (67 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: Rents rising (+1.3%/yr); 723 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 16d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 516 units permitted in Jackson County in 2024 (6 in 5+ unit buildings).
• 3 sale attempts 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.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.5% vs local median 4.2% in Gautier — 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

• 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?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?
• 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.