124 Red Deer Trce #5

Dothan, AL 36301

$199,900D

3 bd · 2.5 ba · 1,490 sqft · Built 2026 · Townhouse · Active · 47 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,609/mo
• Mortgage (P&I): −$1,048
• Tax + insurance: −$333
• HOA: −$0
• Vac / Maint / Mgmt: −$338
• Net cashflow: $-110/mo
• Annual: $-1,324/yr
• Cap rate: 5.63%
• Cash-on-cash: -2.36%
• DSCR: 0.89
• 1% rule: 0.80%
• Cash to close: $55,972

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $200k. Condition is rated good.
• At list price, monthly cash flow is $-110 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $184k (8.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $161k (19.5% below list).
• It's been on market 47 days — a 3% lower offer ($194k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $161k (19.5% 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 (#146 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D, crime F, amenities F.
• Dothan City (urban): math 19% / reading 39% proficiency, ranked #73 of 129 in AL (top 57%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Selma Street Elementary School (math 13% / reading 33%, grade F, #431 of 627 statewide, top 69%, 413 students, 93% FRL); Dothan Preparatory Academy (math 12% / reading 38%, grade F, #163 of 257 statewide, top 64%, 1,133 students, 78% FRL) — zoned schools average 85% FRL vs 59% district-wide (26 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 412 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 463 units permitted in Houston County in 2024 (96 in 5+ unit buildings).
• Houston County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Cap rate 5.6% vs local median 4.4% in Dothan — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 47 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is F 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.