508 E 5th St

Rector, AR 72461

$55,000B-

2 bd · 1.0 ba · 780 sqft · Built — · SingleFamily · Under Contract · 155 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $836/mo
• Mortgage (P&I): −$288
• Tax + insurance: −$92
• HOA: −$0
• Vac / Maint / Mgmt: −$176
• Net cashflow: $280/mo
• Annual: $3,362/yr
• Cap rate: 12.41%
• Cash-on-cash: 21.83%
• DSCR: 1.97
• 1% rule: 1.52%
• Cash to close: $15,400

Investor read

• This is a 2-bed/1.0-bath single-family listed at $55k.
• At list price, monthly cash flow is $280 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($836 rent vs $55k).
• It's been on market 155 days — a 12% lower offer ($48k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $48k (12.0% below list) — sets the bar for market timing.
• In year one you build about $2k of equity ($380 loan paydown + $2k appreciation (3.0% local appreciation)).
• Location reads 66/100 on livability (#120 in AR) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing B+; Watch: schools D-, amenities F, commute F.
• Rector School District (rural): math 35% / reading 27% proficiency, ranked #149 of 238 in AR (top 63%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 37 active listings in the ZIP; 4 units permitted in Clay County in 2024 (0 in 5+ unit buildings).
• Clay County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 6 sale attempts; this cycle's ask has dropped $15k (21%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $5k; list at $55k implies a 1000% gain — meaningful room to come down on a strong offer.
• At projected returns (3.0% appreciation + 3.0% rent growth), your $15k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 155 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?
• 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.