2741 Sumner Pl

Tuscaloosa, AL 35401

$1,900,000C

2 bd · 1.0 ba · 1,792 sqft · Built 1997 · MultiFamily · Active · 201 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $20,965/mo
• Mortgage (P&I): −$9,964
• Tax + insurance: −$3,167
• HOA: −$0
• Vac / Maint / Mgmt: −$4,403
• Net cashflow: $3,432/mo
• Annual: $41,183/yr
• Cap rate: 8.46%
• Cash-on-cash: 7.74%
• DSCR: 1.34
• 1% rule: 1.10%
• Cash to close: $532,000

Investor read

• This is a 2-bed/1.0-bath multifamily listed at $1.90M.
• At list price, monthly cash flow is $3k ($41k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($21k rent vs $1.90M).
• It's been on market 201 days — a 12% lower offer ($1.67M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.67M (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $13k of loan paydown is wiped out by about $57k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#9 in AL, #2,909 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, health & safety A+, cost of living A; Watch: crime F, employment D-.
• Tuscaloosa City (urban): math 19% / reading 40% proficiency, ranked #74 of 129 in AL (top 57%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Market conditions: Rents rising fast (+6.3%/yr); 307 active listings in the ZIP; 21 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 622 units permitted in Tuscaloosa County in 2024 (69 in 5+ unit buildings).
• Tuscaloosa County population projected at +26% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts 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.
• At projected returns (-3.0% appreciation + 6.3% rent growth), your $532k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 60% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.5% vs local median 3.4% in Tuscaloosa — 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 $20,965/mo this rent would consume 863% of the median local household income ($29k/yr) (locally 3997% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 201 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.
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.