1148 Redwood Ln

Midway, FL 32563

$185,000D

2 bd · 1.0 ba · 840 sqft · Built 1984 · Other · Active · 31 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,612/mo
• Mortgage (P&I): −$970
• Tax + insurance: −$375
• HOA: −$0
• Vac / Maint / Mgmt: −$338
• Net cashflow: $-72/mo
• Annual: $-862/yr
• Cap rate: 6.26%
• Cash-on-cash: -0.12%
• DSCR: 0.99
• 1% rule: 0.87%
• Cash to close: $51,800

Investor read

• This is a 2-bed/1.0-bath other listed at $185k. Condition is rated good.
• At list price, monthly cash flow is $-72 ($-862/yr) — negative.
• To cash-flow at today's rent, offer at most $175k (5.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $161k (12.9% below list).
• It's been on market 31 days — a 3% lower offer ($179k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $161k (12.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Santa Rosa (suburban): math 63% / reading 60% proficiency, ranked #8 of 73 in FL (top 11%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Oriole Beach Elementary School (math 76% / reading 72%, grade A, #249 of 2,144 statewide, top 12%, 799 students, 32% FRL); Gulf Breeze Middle School (math 82% / reading 72%, grade A, #28 of 571 statewide, top 5%, 936 students, 22% FRL); Gulf Breeze High School (math 67% / reading 69%, grade B, #66 of 667 statewide, top 10%, 1,978 students, 21% FRL).
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: Rents rising fast (+4.6%/yr); 459 active listings in the ZIP; 6 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; 1,983 units permitted in Santa Rosa County in 2024 (128 in 5+ unit buildings).
• Santa Rosa County population projected at +31% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.3% vs local median 4.1% in Midway — 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?
• It's been on market 31 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• 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.
• 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.