904 SE 3rd Ter

Lee's Summit, MO 64063

$349,900B+

8 bd · 7.0 ba · 6,448 sqft · Built 1965 · MultiFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,698/mo
• Mortgage (P&I): −$1,835
• Tax + insurance: −$639
• HOA: −$0
• Vac / Maint / Mgmt: −$987
• Net cashflow: $1,238/mo
• Annual: $14,854/yr
• Cap rate: 10.73%
• Cash-on-cash: 15.84%
• DSCR: 1.70
• 1% rule: 1.34%
• Cash to close: $97,972

Investor read

• This is a 2 × 4-bed/3.5-bath units multifamily listed at $350k. Condition is rated good.
• At list price, monthly cash flow is $1k ($15k/yr) — positive. Per door: $619/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $350k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads: area grade B — affects rentability + tenant quality, not the cash-flow math above.
• Lee'S Summit R-VII (suburban): math 46% / reading 55% proficiency, ranked #23 of 324 in MO (top 7%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 16% free/reduced lunch — higher-income household profile.
• Watch-outs: flood insurance adds $56/mo.
• Market conditions: Rents rising fast (+5.0%/yr); 103 active listings in the ZIP; solid renter incomes; 4,002 units permitted in Jackson County in 2024 (2,271 in 5+ unit buildings).
• Jackson County population projected at +4% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 19y ago; this cycle's ask is 100% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• At projected returns (-3.0% appreciation + 5.0% rent growth), your $98k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.7% vs local median 2.6% in Lee's Summit — 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.
• At $4,698/mo this rent would consume 70% of the median local household income ($80k/yr) (locally 573% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1965 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.