124 Red Deer Trce #5

Dothan, AL 36301

$199,900C-

3 bd · 2.5 ba · 1,490 sqft · Built 2026 · Townhouse · Active · 141 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,971/mo
• Mortgage (P&I): −$1,048
• Tax + insurance: −$333
• HOA: −$0
• Vac / Maint / Mgmt: −$414
• Net cashflow: $176/mo
• Annual: $2,107/yr
• Cap rate: 7.35%
• Cash-on-cash: 3.76%
• DSCR: 1.17
• 1% rule: 0.99%
• 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 $176 ($2k/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 $197k (1.4% below list).
• It's been on market 141 days — a 12% lower offer ($176k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $176k (12.0% below list) — sets the bar for market timing.
• 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: 620 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals leasing fast (median 6d on market — plan ~1-2 weeks tenant-placement turnaround); 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 7.3% vs local median 4.6% in Dothan — 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 $1,971/mo this rent would consume 48% of the median local household income ($49k/yr) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 141 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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?
• 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.