5106 Lower Elm St

South Fulton, GA 30349

$239,500C

3 bd · 2.5 ba · 1,737 sqft · Built 2020 · Townhouse · Pending · 30 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,145/mo
• Mortgage (P&I): −$1,256
• Tax + insurance: −$399
• HOA: −$74
• Vac / Maint / Mgmt: −$450
• Net cashflow: $-35/mo
• Annual: $-417/yr
• Cap rate: 6.12%
• Cash-on-cash: -0.62%
• DSCR: 0.97
• 1% rule: 0.90%
• Cash to close: $67,060

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $240k.
• At list price, monthly cash flow is $-35 ($-417/yr) — negative.
• To cash-flow at today's rent, offer at most $234k (2.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $214k (10.4% below list).
• It's been on market 30 days — a 2% lower offer ($236k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $214k (10.4% below list) — sets the bar for 1% rule.
• In year one you build about $26k of equity ($2k loan paydown + $24k appreciation (10.0% local appreciation)).
• Location reads: area grade C — affects rentability + tenant quality, not the cash-flow math above.
• Fulton County (suburban): math 49% / reading 53% proficiency, ranked #12 of 174 in GA (top 7%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Wolf Creek Elementary (math 27% / reading 32%, grade F, #633 of 1,228 statewide, top 54%, 797 students, 56% FRL); Renaissance Middle School (math 22% / reading 27%, grade F, #301 of 470 statewide, top 66%, 1,166 students, 71% FRL); Langston Hughes High School (math 8% / reading 17%, grade F, #336 of 424 statewide, top 80%, 1,964 students, 65% FRL) — zoned schools average 64% FRL vs 41% district-wide (23 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 22% at this address vs 51% district-wide (-29 pts) — the specific schools serving this property underperform the Fulton County average; the district grade overstates school quality for this exact location.
• Market conditions: Rents flat; 651 active listings in the ZIP; 26 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 11,565 units permitted in Fulton County in 2024 (8,159 in 5+ unit buildings).
• Fulton County population projected at +38% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 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.
• At projected returns (10.0% appreciation + 0.9% rent growth), your $67k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$41k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate wind risk, 25% chance of damaging wind over 30y; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 4.6% in South Fulton — 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

• 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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.