1413 2nd St NE

Arab, AL 35016

$190,000D-

3 bd · 1.5 ba · 1,225 sqft · Built 1968 · SingleFamily · Active · 51 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,206/mo
• Mortgage (P&I): −$996
• Tax + insurance: −$120
• HOA: −$0
• Vac / Maint / Mgmt: −$253
• Net cashflow: $-164/mo
• Annual: $-1,966/yr
• Cap rate: 5.26%
• Cash-on-cash: -3.70%
• DSCR: 0.84
• 1% rule: 0.63%
• Cash to close: $53,200

Investor read

• This is a 3-bed/1.5-bath single-family listed at $190k.
• At list price, monthly cash flow is $-164 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $161k (15.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $121k (36.5% below list).
• It's been on market 51 days — a 3% lower offer ($184k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $121k (36.5% 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 64/100 on livability (#149 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment C-, crime D, amenities F.
• Arab City (rural): math 47% / reading 64% proficiency, ranked #9 of 129 in AL (top 7%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Arab Elementary School (math 59% / reading 73%, grade B+, #36 of 627 statewide, top 6%, 580 students, 52% FRL); Arab Junior High School (math 39% / reading 61%, grade C, #25 of 257 statewide, top 10%, 592 students, 51% FRL); Arab High School (math 37% / reading 47%, grade F, #28 of 305 statewide, top 10%, 779 students, 40% FRL) — zoned schools average 47% FRL vs 29% district-wide (19 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 180 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 16d on market — plan ~3-4 weeks tenant-placement turnaround); 163 units permitted in Marshall County in 2024 (0 in 5+ unit buildings).
• 7 sale attempts since 4y 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.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.3% vs local median 3.2% in Arab — 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 51 days. Have you received any prior offers? Is the seller open to a 37% concession, seller financing, or rate buy-down credit?
• Built in 1968 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.