408 Bailey Rd

Madison, NC 27025

$119,900C

2 bd · 1.0 ba · 1,900 sqft · Built 1957 · SingleFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,270/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$136
• HOA: −$0
• Vac / Maint / Mgmt: −$267
• Net cashflow: $238/mo
• Annual: $2,862/yr
• Cap rate: 8.68%
• Cash-on-cash: 8.52%
• DSCR: 1.38
• 1% rule: 1.06%
• Cash to close: $33,572

Investor read

• This is a 2-bed/1.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $238 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $120k).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $829 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#158 in NC) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: schools D, employment D, amenities F.
• Rockingham County Schools (rural): math 38% / reading 40% proficiency, ranked #120 of 178 in NC (top 67%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1957 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 53 active listings in the ZIP; 344 units permitted in Rockingham County in 2024 (0 in 5+ unit buildings).
• Rockingham County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Climate carrying-cost: extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.7% vs local median 2.9% in Madison — 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

• Built in 1957 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.