124 Red Deer Trace Unit 6

Dothan, AL 36301

$199,900D

3 bd · 2.5 ba · 1,430 sqft · Built 2026 · Condo · Active · 49 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,974/mo
• Mortgage (P&I): −$1,108
• Tax + insurance: −$352
• HOA: −$100
• Vac / Maint / Mgmt: −$415
• Net cashflow: $-1/mo
• Annual: $-7/yr
• Cap rate: 6.29%
• Cash-on-cash: -0.01%
• DSCR: 1.00
• 1% rule: 0.93%
• Cash to close: $59,171

Investor read

• This is a 3-bed/2.5-bath condo listed at $200k. Condition is rated excellent.
• At list price, monthly cash flow is $-1 ($-7/yr) — negative.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $197k (1.2% below list).
• It's been on market 49 days — a 3% lower offer ($194k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $194k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#146 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D, crime F, amenities F.
• Dothan City (urban): math 19% / reading 39% proficiency, ranked #73 of 129 in AL (top 57%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Heard Elementary School (math 22% / reading 52%, grade F, #267 of 627 statewide, top 45%, 338 students, 75% FRL); Dothan Preparatory Academy (math 12% / reading 38%, grade F, #163 of 257 statewide, top 64%, 1,133 students, 78% FRL); Dothan High School (math 16% / reading 24%, grade F, #163 of 305 statewide, top 54%, 1,454 students, 70% FRL) — zoned schools average 74% FRL vs 59% district-wide (15 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 620 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals leasing fast (median 6d on market — plan ~1-2 weeks tenant-placement turnaround); 463 units permitted in Houston County in 2024 (96 in 5+ unit buildings).
• Houston County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 7 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.
• Cap rate 6.3% vs local median 4.6% in Dothan — 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 $1,974/mo this rent would consume 48% of the median local household income ($49k/yr) — very limited rent-growth headroom before tenants either downsize or default.

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 49 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• 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?
• 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?