501 W Church St

Newton, MS 39345

$139,900D

3 bd · 1.0 ba · 2,520 sqft · Built 1900 · Other · Active · 84 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,183/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$210
• HOA: −$0
• Vac / Maint / Mgmt: −$248
• Net cashflow: $-9/mo
• Annual: $-107/yr
• Cap rate: 6.22%
• Cash-on-cash: -0.27%
• DSCR: 0.99
• 1% rule: 0.85%
• Cash to close: $39,172

Investor read

• This is a 3-bed/1.0-bath other listed at $140k.
• At list price, monthly cash flow is $-9 ($-107/yr) — negative.
• To cash-flow at today's rent, offer at most $138k (1.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $118k (15.4% below list).
• It's been on market 84 days — a 6% lower offer ($132k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $118k (15.4% below list) — sets the bar for 1% rule.
• In year one you build about $4k of equity ($967 loan paydown + $3k appreciation (2.2% local appreciation)).
• Location reads 57/100 on livability (#292 in MS) — a working-class tenant base; expect higher turnover. Strengths: crime A+, cost of living A+, housing B; Watch: amenities F, commute F, employment F.
• Newton Municipal School District (town): math 19% / reading 23% proficiency, ranked #91 of 130 in MS (top 70%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 83% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Newton Elementary School (math 15% / reading 21%, grade F, #254 of 375 statewide, top 68%, 389 students, 100% FRL); N H Pilate Middle School (math 22% / reading 22%, grade F, #107 of 179 statewide, top 60%, 179 students, 100% FRL) — zoned schools average 100% FRL vs 83% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 19 active listings in the ZIP; 3 units permitted in Newton County in 2024 (0 in 5+ unit buildings).
• Newton County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 5 sale attempts since 2y ago 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.
• Current owner paid $40k; list at $140k implies a 250% gain — meaningful room to come down on a strong offer.
• At projected returns (2.2% appreciation + 3.0% rent growth), your $39k cash investment doubles in ~8 years — after that, you're playing with house money.
• By year 8, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 84 days. Have you received any prior offers? Is the seller open to a 15% concession, seller financing, or rate buy-down credit?
• Built in 1900 — 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.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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?
• 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.