122 N 7th St

Sterling, KS 67579

$124,500D

3 bd · 2.0 ba · 1,499 sqft · Built 1922 · SingleFamily · Pending · 80 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,120/mo
• Mortgage (P&I): −$653
• Tax + insurance: −$208
• HOA: −$0
• Vac / Maint / Mgmt: −$235
• Net cashflow: $24/mo
• Annual: $293/yr
• Cap rate: 6.53%
• Cash-on-cash: 0.84%
• DSCR: 1.04
• 1% rule: 0.90%
• Cash to close: $34,860

Investor read

• This is a 3-bed/2.0-bath single-family listed at $124k.
• At list price, monthly cash flow is $24 ($293/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $112k (10.0% below list).
• It's been on market 80 days — a 6% lower offer ($117k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $112k (10.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $861 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#24 in KS, #2,382 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, employment F.
• Sterling (rural): math 55% / reading 49% proficiency, ranked #8 of 169 in KS (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Sterling Grade School (math 67% / reading 52%, grade B-, #70 of 684 statewide, top 12%, 260 students, 46% FRL); Sterling Junior High/Senior High (math 42% / reading 42%, grade F, #12 of 327 statewide, top 5%, 214 students, 39% FRL).
• Watch-outs: built in 1922 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 22 active listings in the ZIP; 13 units permitted in Rice County in 2024 (0 in 5+ unit buildings).
• Rice County population projected to shrink 4% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Climate carrying-cost: major flood risk; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 80 days. Have you received any prior offers? Is the seller open to a 10% concession, seller financing, or rate buy-down credit?
• Built in 1922 — 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.
• 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.