42 Lake Forest Estate Rd

Tumbling Shoals, AR 72581

$85,000A-

2 bd · 1.0 ba · 1,134 sqft · Built 1983 · Manufactured · Under Contract · 39 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $977/mo
• Mortgage (P&I): −$446
• Tax + insurance: −$53
• HOA: −$0
• Vac / Maint / Mgmt: −$205
• Net cashflow: $272/mo
• Annual: $3,269/yr
• Cap rate: 10.14%
• Cash-on-cash: 13.73%
• DSCR: 1.61
• 1% rule: 1.15%
• Cash to close: $23,800

Investor read

• This is a 2-bed/1.0-bath manufactured listed at $85k.
• At list price, monthly cash flow is $272 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($977 rent vs $85k).
• It's been on market 39 days — a 3% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $82k (3.0% below list) — sets the bar for market timing.
• In year one you build about $9k of equity ($588 loan paydown + $8k appreciation (10.0% local appreciation)).
• Location reads 57/100 on livability (#347 in AR) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, crime A-; Watch: employment D, schools F, amenities F.
• Heber Springs School District (town): math 50% / reading 49% proficiency, ranked #19 of 238 in AR (top 8%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 20 active listings in the ZIP; 13 units permitted in Cleburne County in 2024 (0 in 5+ unit buildings).
• Cleburne County population projected at -18% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $24k cash investment doubles in ~2 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.1% vs local median 2.2% in Tumbling Shoals — 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

• It's been on market 39 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• 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?
• 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.