304 E Sixth Ave

Petal, MS 39465

$199,500D+

3 bd · 2.0 ba · 1,764 sqft · Built 1978 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,618/mo
• Mortgage (P&I): −$1,046
• Tax + insurance: −$261
• HOA: −$0
• Vac / Maint / Mgmt: −$340
• Net cashflow: $-29/mo
• Annual: $-351/yr
• Cap rate: 6.52%
• Cash-on-cash: 0.80%
• DSCR: 1.04
• 1% rule: 0.81%
• Cash to close: $55,860

Investor read

• This is a 3-bed/2.0-bath single-family listed at $200k.
• At list price, monthly cash flow is $-29 ($-351/yr) — negative.
• To cash-flow at today's rent, offer at most $194k (2.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $162k (18.9% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $162k (18.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#18 in MS) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: health & safety D, amenities F, commute F.
• Petal School District (suburban): math 68% / reading 56% proficiency, ranked #2 of 130 in MS (top 2%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Petal Elementary (math 71% / reading 62%, grade B+, #14 of 375 statewide, top 3%, 634 students, 100% FRL); Petal Middle School (math 72% / reading 55%, grade B+, #3 of 179 statewide, top 2%, 745 students, 100% FRL); Petal High School (math 53% / reading 49%, grade D+, #17 of 197 statewide, top 9%, 1,288 students, 100% FRL) — zoned schools average 100% FRL vs 49% district-wide (51 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 228 active listings in the ZIP; 121 units permitted in Forrest County in 2024 (30 in 5+ unit buildings).
• Forrest County population projected at +6% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 25y 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.
• Climate carrying-cost: major flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.5% vs local median 4.0% in Petal — 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?
• Built in 1978 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.
• 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.