507 W Morgan St St

Paragould, AR 72450

$19,000D

3 bd · 1.0 ba · 1,120 sqft · Built 1960 · SingleFamily · Under Contract · 26 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $987/mo
• Mortgage (P&I): −$100
• Tax + insurance: −$101
• HOA: −$0
• Vac / Maint / Mgmt: −$207
• Net cashflow: $580/mo
• Annual: $6,954/yr
• Cap rate: 47.09%
• Cash-on-cash: 145.71%
• DSCR: 7.48
• 1% rule: 5.20%
• Cash to close: $5,320

Investor read

• This is a 3-bed/1.0-bath single-family listed at $19k.
• At list price, monthly cash flow is $580 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($987 rent vs $19k).
• It's been on market 26 days — a 2% lower offer ($19k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $19k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $131 of loan paydown is wiped out by about $570 of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#159 in AR) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, crime F, amenities F.
• Paragould School District (town): math 35% / reading 34% proficiency, ranked #124 of 238 in AR (top 52%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 188 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 265 units permitted in Greene County in 2024 (135 in 5+ unit buildings).
• Greene County population projected at +20% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $14k; 31% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $5k cash investment doubles in ~1 year — after that, you're playing with house money.
• Climate carrying-cost: major flood risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 47.1% vs local median 4.5% in Paragould — 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

• Built in 1960 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.