3134 Highway 20 #8

Sweet Home, OR 97386

$39,000B-

2 bd · 1.0 ba · 728 sqft · Built 1976 · Other · Active · 31 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,050/mo
• Mortgage (P&I): −$205
• Tax + insurance: −$45
• HOA: −$0
• Vac / Maint / Mgmt: −$221
• Net cashflow: $580/mo
• Annual: $6,962/yr
• Cap rate: 24.14%
• Cash-on-cash: 63.75%
• DSCR: 3.84
• 1% rule: 2.69%
• Cash to close: $10,920

Investor read

• This is a 2-bed/1.0-bath other listed at $39k.
• 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 ($1k rent vs $39k).
• It's been on market 31 days — a 3% lower offer ($38k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $38k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $270 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#233 in OR) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety C-, schools D-, amenities F.
• Sweet Home SD 55 (town): math 26% / reading 42% proficiency, ranked #29 of 58 in OR (top 50%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 166 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 311 units permitted in Linn County in 2024 (60 in 5+ unit buildings).
• Linn County population projected at +5% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $11k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: moderate wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 24.1% vs local median 2.9% in Sweet Home — 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 31 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1976 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.