1202 Fallston Rd

Shelby, NC 28150

$145,000C

3 bd · 1.5 ba · 1,419 sqft · Built 1964 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,351/mo
• Mortgage (P&I): −$760
• Tax + insurance: −$199
• HOA: −$0
• Vac / Maint / Mgmt: −$284
• Net cashflow: $108/mo
• Annual: $1,292/yr
• Cap rate: 7.18%
• Cash-on-cash: 3.18%
• DSCR: 1.14
• 1% rule: 0.93%
• Cash to close: $40,600

Investor read

• This is a 3-bed/1.5-bath single-family listed at $145k.
• At list price, monthly cash flow is $108 ($1k/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 $135k (6.8% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $135k (6.8% 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 $4k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#52 in NC, #4,349 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F, employment F.
• Cleveland County Schools (rural): math 47% / reading 49% proficiency, ranked #76 of 178 in NC (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Washington Elementary (math 42% / reading 37%, grade F, #694 of 1,410 statewide, top 53%, 415 students, 99% FRL); Burns High (math 42% / reading 59%, grade D+, #306 of 535 statewide, top 57%, 934 students, 60% FRL) — zoned schools average 80% FRL vs 59% district-wide (20 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+6.7%/yr); 241 active listings in the ZIP; 461 units permitted in Cleveland County in 2024 (38 in 5+ unit buildings).
• Cleveland County population projected at -15% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Climate carrying-cost: extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.2% vs local median 2.9% in Shelby — 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 1964 — 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?
• 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.
• 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.