1523 Middle Ridge Dr

Fuquay-Varina, NC 27592

$270,000D+

3 bd · 2.0 ba · 1,380 sqft · Built 1998 · SingleFamily · Pending · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,178/mo
• Mortgage (P&I): −$1,416
• Tax + insurance: −$271
• HOA: −$7
• Vac / Maint / Mgmt: −$457
• Net cashflow: $27/mo
• Annual: $327/yr
• Cap rate: 6.41%
• Cash-on-cash: 0.43%
• DSCR: 1.02
• 1% rule: 0.81%
• Cash to close: $75,600

Investor read

• This is a 3-bed/2.0-bath single-family listed at $270k.
• At list price, monthly cash flow is $27 ($327/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 $218k (19.3% below list).
• It's been on market 27 days — a 2% lower offer ($266k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $218k (19.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Wake County Schools (suburban): math 52% / reading 60% proficiency, ranked #35 of 178 in NC (top 20%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Banks Road Elementary (math 42% / reading 52%, grade D-, #497 of 1,410 statewide, top 38%, 648 students, 43% FRL); West Lake Middle (math 47% / reading 56%, grade C, #103 of 475 statewide, top 22%, 877 students, 40% FRL); Willow Spring High (1,477 students, 30% FRL).
• Market conditions: 252 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 15,249 units permitted in Wake County in 2024 (5,568 in 5+ unit buildings).
• Wake County population projected at +51% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 17y 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 $55k; list at $270k implies a 391% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 55% chance of damaging wind over 30y; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.4% vs local median 3.0% in Fuquay-Varina — 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 does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.