4971 Potter Park Loop

Missoula, MT 59808

$975,000B

33 bd · 16.5 ba · 3,698 sqft · Built 2014 · MultiFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $16,518/mo
• Mortgage (P&I): −$5,113
• Tax + insurance: −$1,106
• HOA: −$0
• Vac / Maint / Mgmt: −$3,469
• Net cashflow: $6,830/mo
• Annual: $81,960/yr
• Cap rate: 14.70%
• Cash-on-cash: 30.02%
• DSCR: 2.34
• 1% rule: 1.69%
• Cash to close: $273,000

Investor read

• This is a 11 × 3-bed/?-bath units multifamily listed at $975k.
• At list price, monthly cash flow is $7k ($82k/yr) — positive. Per door: $621/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($17k rent vs $975k).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $7k of loan paydown is wiped out by about $29k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#17 in MT, #2,351 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, health & safety A+; Watch: employment C-, crime F.
• Missoula H S (urban): math 31% / reading 52% proficiency, ranked #53 of 116 in MT (top 46%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Hellgate Elem Lower Grades (math 47% / reading 57%, grade C-, #69 of 293 statewide, top 27%, 338 students, 0% FRL); Hellgate Middle School (math 46% / reading 64%, grade B-, #14 of 146 statewide, top 9%, 329 students, 0% FRL); Big Sky High School (math 21% / reading 37%, grade F, #74 of 132 statewide, top 56%, 1,186 students, 0% FRL).
• Market conditions: Rents rising (+2.4%/yr); 245 active listings in the ZIP; solid renter incomes; 773 units permitted in Missoula County in 2024 (354 in 5+ unit buildings).
• Missoula County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 13y 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.
• At projected returns (-3.0% appreciation + 2.4% rent growth), your $273k cash investment doubles in ~5 years — after that, you're playing with house money.
• Climate carrying-cost: severe wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 14.7% vs local median 1.7% in Missoula — 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 $16,518/mo this rent would consume 247% of the median local household income ($80k/yr) (locally 1022% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.