1228 Fulton Ave SW

Birmingham, AL 35211

$125,000B-

4 bd · 2.0 ba · 1,800 sqft · Built 1972 · MultiFamily · Active · 182 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,870/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$208
• HOA: −$0
• Vac / Maint / Mgmt: −$393
• Net cashflow: $613/mo
• Annual: $7,361/yr
• Cap rate: 12.18%
• Cash-on-cash: 21.03%
• DSCR: 1.94
• 1% rule: 1.50%
• Cash to close: $35,000

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $125k. Condition is rated average.
• At list price, monthly cash flow is $613 ($7k/yr) — positive. Per door: $307/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $125k).
• It's been on market 182 days — a 12% lower offer ($110k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $110k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $864 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#78 in AL) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities C-, schools F, crime F.
• Birmingham City (urban): math 4% / reading 20% proficiency, ranked #116 of 129 in AL (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 82% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents soft (-0.0%/yr); 244 active listings in the ZIP; 10 comparable units currently listed for rent nearby; rentals lingering (median 108d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 60% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 2,114 units permitted in Jefferson County in 2024 (556 in 5+ unit buildings).
• Jefferson County population projected to shrink 4% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts; this cycle's ask is 15525% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $35k cash investment doubles in ~8 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.2% vs local median 6.2% in Birmingham — 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.
• This rent per unit runs 32% of the median local income ($35k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 182 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1972 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 F-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?

Repairs flagged (vision-AI assessment)

• Moderate: Kitchen cabinets — Worn appearance
• Minor: Kitchen countertops — Need cleaning