120 W 3rd St

Adrian, MO 64720

$15,000C-

2 bd · 1.0 ba · 1,088 sqft · Built 1937 · Other · Pending · 354 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $974/mo
• Mortgage (P&I): −$79
• Tax + insurance: −$39
• HOA: −$0
• Vac / Maint / Mgmt: −$205
• Net cashflow: $652/mo
• Annual: $7,825/yr
• Cap rate: 58.46%
• Cash-on-cash: 186.30%
• DSCR: 9.29
• 1% rule: 6.49%
• Cash to close: $4,200

Investor read

• This is a 2-bed/1.0-bath other listed at $15k.
• At list price, monthly cash flow is $652 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($974 rent vs $15k).
• It's been on market 354 days — a 12% lower offer ($13k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $13k (12.0% below list) — sets the bar for market timing.
• In year one you build about $2k of equity ($104 loan paydown + $2k appreciation (10.0% local appreciation)).
• Location reads 71/100 on livability (#102 in MO) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: schools C-, amenities F, commute F.
• Adrian R-III (rural): math 28% / reading 50% proficiency, ranked #167 of 324 in MO (top 52%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: property tax is 2.6% of price; built in 1937 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 29 active listings in the ZIP; 2 units permitted in Bates County in 2024 (0 in 5+ unit buildings).
• Bates County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts; this cycle's ask has dropped $15k (50%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $4k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 58.5% vs local median 2.5% in Adrian — 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 354 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1937 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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.
• 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.