600 Higdon Ferry Rd

Hot Springs, AR 71913

$164,000F

2 bd · 2.0 ba · 1,160 sqft · Built 1975 · Condo · Active · 35 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,132/mo
• Mortgage (P&I): −$860
• Tax + insurance: −$116
• HOA: −$188
• Vac / Maint / Mgmt: −$238
• Net cashflow: $-270/mo
• Annual: $-3,239/yr
• Cap rate: 4.32%
• Cash-on-cash: -7.05%
• DSCR: 0.69
• 1% rule: 0.69%
• Cash to close: $45,920

Investor read

• This is a 2-bed/2.0-bath condo listed at $164k.
• At list price, monthly cash flow is $-270 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $150k (8.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $113k (31.0% below list).
• It's been on market 35 days — a 3% lower offer ($159k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $113k (31.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#140 in AR) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A-; Watch: crime F, amenities F, commute F.
• Hot Springs School District (urban): math 24% / reading 25% proficiency, ranked #195 of 238 in AR (top 82%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 72% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Hot Springs Junior Academy (math 20% / reading 29%, grade F, #166 of 201 statewide, top 84%, 815 students, 100% FRL, charter); Hot Springs World Class High School (math 12% / reading 24%, grade F, #252 of 292 statewide, top 87%, 739 students, 100% FRL, charter) — zoned schools average 100% FRL vs 72% district-wide (28 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+6.4%/yr); 981 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 117 units permitted in Garland County in 2024 (24 in 5+ unit buildings).
• Garland County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 10y ago; this cycle's ask is 17% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $103k; list at $164k implies a 59% gain — meaningful room to come down on a strong offer.
• Cap rate 4.3% vs local median 2.8% in Hot Springs — 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 35 days. Have you received any prior offers? Is the seller open to a 31% concession, seller financing, or rate buy-down credit?
• Built in 1975 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?