111 Starlight St

Sanford, NC 27330

$225,000D-

3 bd · 2.5 ba · 1,482 sqft · Built 2023 · Townhouse · Active · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,789/mo
• Mortgage (P&I): −$1,180
• Tax + insurance: −$342
• HOA: −$195
• Vac / Maint / Mgmt: −$376
• Net cashflow: $-303/mo
• Annual: $-3,641/yr
• Cap rate: 4.67%
• Cash-on-cash: -5.78%
• DSCR: 0.74
• 1% rule: 0.80%
• Cash to close: $63,000

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $225k. Condition is rated good.
• At list price, monthly cash flow is $-303 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $171k (23.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $179k (20.5% below list).
• It's been on market 22 days — a 2% lower offer ($222k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $171k (23.8% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#92 in NC) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D, crime D-, commute F.
• Lee County Schools (rural): math 31% / reading 39% proficiency, ranked #131 of 178 in NC (top 74%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Tramway Elementary (math 45% / reading 47%, grade D-, #551 of 1,410 statewide, top 40%, 545 students, 47% FRL); East Lee Middle (math 21% / reading 37%, grade F, #350 of 475 statewide, top 74%, 531 students, 71% FRL); Lee County High (math 39% / reading 44%, grade F, #381 of 535 statewide, top 72%, 1,508 students, 60% FRL) — zoned schools at 59% FRL track the district average.
• Market conditions: Rents rising fast (+4.7%/yr); 802 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals lingering (median 88d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 56% of comp listings sitting > 30 days — soft ceiling on asking rent; 602 units permitted in Lee County in 2024 (0 in 5+ unit buildings).
• Lee County population projected at +8% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 6 sale attempts since 3y ago; this cycle's ask is 13174% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Climate carrying-cost: major wind risk, 43% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.7% vs local median 3.8% in Sanford — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• This rent runs 35% of the median local income ($61k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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.
• 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?
• Crime grade is D 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?
• 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.