440 N Grogg St

Spring Lake, NC 28390

$115,000B-

3 bd · 1.0 ba · 1,398 sqft · Built 1962 · SingleFamily · Pending · 215 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,419/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$245
• HOA: −$0
• Vac / Maint / Mgmt: −$298
• Net cashflow: $273/mo
• Annual: $3,280/yr
• Cap rate: 9.15%
• Cash-on-cash: 10.19%
• DSCR: 1.45
• 1% rule: 1.23%
• Cash to close: $32,200

Investor read

• This is a 3-bed/1.0-bath single-family listed at $115k.
• At list price, monthly cash flow is $273 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $115k).
• It's been on market 215 days — a 12% lower offer ($101k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $101k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $795 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#543 in NC) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: crime F, amenities F, commute F.
• Cumberland County Schools (urban): math 32% / reading 41% proficiency, ranked #126 of 178 in NC (top 71%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Manchester Elementary (math 22% / reading 32%, grade F, #1,033 of 1,410 statewide, top 76%, 271 students, 99% FRL); Spring Lake Middle (math 15% / reading 31%, grade F, #406 of 475 statewide, top 86%, 512 students, 99% FRL); Pine Forest High (math 73% / reading 51%, grade B-, #184 of 535 statewide, top 37%, 1,572 students, 62% FRL) — zoned schools average 87% FRL vs 55% district-wide (32 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+4.5%/yr); 351 active listings in the ZIP; 17 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 1,125 units permitted in Cumberland County in 2024 (104 in 5+ unit buildings).
• 4 sale attempts since 3y ago; this cycle's ask has dropped $20k (15%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $90k; 28% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 4.5% rent growth), your $32k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 72% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.1% vs local median 4.5% in Spring Lake — 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 215 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1962 — 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.
• 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?
• Crime grade is F 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?
• 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.