5 Gumtree Rd Unit G-13

Hilton Head Island, SC 29926

$189,000D

1 bd · 1.0 ba · 600 sqft · Built 1984 · Condo · Pending · 43 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,753/mo
• Mortgage (P&I): −$991
• Tax + insurance: −$315
• HOA: −$0
• Vac / Maint / Mgmt: −$368
• Net cashflow: $79/mo
• Annual: $942/yr
• Cap rate: 6.79%
• Cash-on-cash: 1.78%
• DSCR: 1.08
• 1% rule: 0.93%
• Cash to close: $52,920

Investor read

• This is a 1-bed/1.0-bath condo listed at $189k. Condition is rated average.
• At list price, monthly cash flow is $79 ($942/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 $175k (7.3% below list).
• It's been on market 43 days — a 3% lower offer ($183k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $175k (7.3% 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 64/100 on livability (#157 in SC) — a middle-class / working-renter tenant base. Strengths: employment A+, crime A-; Watch: amenities F, commute F, cost of living F.
• Beaufort 01 (town): math 42% / reading 51% proficiency, ranked #17 of 80 in SC (top 21%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents soft (-0.2%/yr); 385 active listings in the ZIP; solid renter incomes; 1,824 units permitted in Beaufort County in 2024 (618 in 5+ unit buildings).
• Beaufort County population projected at +30% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 6.8% vs local median 3.0% in Hilton Head Island — 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

• It's been on market 43 days. Have you received any prior offers? Is the seller open to a 7% concession, seller financing, or rate buy-down credit?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?
• 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 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.

Repairs flagged (vision-AI assessment)

• Moderate: kitchen cabinets — dated and in need of updating
• Moderate: bathroom fixtures — basic and in need of updating
• Moderate: landscaping — moderate landscaping