1218 Southwood Dr Unit 1218, 1220, 1222, 1224

Fayetteville, NC 28304

$379,900C

2 bd · 1.5 ba · 3,509 sqft · Built 1973 · MultiFamily · Active · 95 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,255/mo
• Mortgage (P&I): −$1,992
• Tax + insurance: −$633
• HOA: −$0
• Vac / Maint / Mgmt: −$894
• Net cashflow: $736/mo
• Annual: $8,833/yr
• Cap rate: 8.62%
• Cash-on-cash: 8.30%
• DSCR: 1.37
• 1% rule: 1.12%
• Cash to close: $106,372

Investor read

• This is a 2-bed/1.5-bath multifamily listed at $380k. Condition is rated good.
• At list price, monthly cash flow is $736 ($9k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $380k).
• It's been on market 95 days — a 9% lower offer ($346k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $346k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#45 in NC, #4,031 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: schools C-, crime F, employment D-.
• Cumberland County Schools (urban): math 32% / reading 41% proficiency, ranked #126 of 178 in NC (top 71%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+3.2%/yr); 308 active listings in the ZIP; 1,125 units permitted in Cumberland County in 2024 (104 in 5+ unit buildings).
• 2 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.
• Climate carrying-cost: major wind risk, 75% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.6% vs local median 4.8% in Fayetteville — 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 $4,255/mo this rent would consume 87% of the median local household income ($59k/yr) (locally 1667% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 95 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1973 — 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.
• 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?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.