606 Lee Road 238

Ladonia, AL 36870

$133,000D+

1 bd · 1.0 ba · 1,096 sqft · Built 1993 · SingleFamily · Active · 198 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,271/mo
• Mortgage (P&I): −$697
• Tax + insurance: −$96
• HOA: −$0
• Vac / Maint / Mgmt: −$267
• Net cashflow: $210/mo
• Annual: $2,523/yr
• Cap rate: 8.19%
• Cash-on-cash: 6.78%
• DSCR: 1.30
• 1% rule: 0.96%
• Cash to close: $37,240

Investor read

• This is a 1-bed/1.0-bath single-family listed at $133k.
• At list price, monthly cash flow is $210 ($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 $127k (4.4% below list).
• It's been on market 198 days — a 12% lower offer ($117k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $117k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $920 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 61/100 on livability (#251 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: employment D, schools F, amenities F.
• Lee County (rural): math 23% / reading 47% proficiency, ranked #40 of 129 in AL (top 31%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 132 active listings in the ZIP; 1,858 units permitted in Lee County in 2024 (113 in 5+ unit buildings).
• Lee County population projected at +54% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major wind risk, 76% 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.
• Cap rate 8.2% vs local median 4.4% in Ladonia — 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

• It's been on market 198 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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?
• 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.