3506 Dresden Dr

Montgomery, AL 36111

$180,000D

3 bd · 2.0 ba · 1,771 sqft · Built 2017 · SingleFamily · Active · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,465/mo
• Mortgage (P&I): −$944
• Tax + insurance: −$143
• HOA: −$0
• Vac / Maint / Mgmt: −$308
• Net cashflow: $70/mo
• Annual: $838/yr
• Cap rate: 6.76%
• Cash-on-cash: 1.66%
• DSCR: 1.07
• 1% rule: 0.81%
• Cash to close: $50,400

Investor read

• This is a 3-bed/2.0-bath single-family listed at $180k.
• At list price, monthly cash flow is $70 ($838/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 $146k (18.6% below list).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $146k (18.6% 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 $5k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#138 in AL) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment D, crime F, amenities D-.
• Montgomery County (urban): math 9% / reading 31% proficiency, ranked #106 of 129 in AL (top 82%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 70% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Dannelly Elementary School (math 2% / reading 21%, grade F, #556 of 627 statewide, top 89%, 622 students, 88% FRL); Brewbaker Middle School (math 0% / reading 19%, grade F, #227 of 257 statewide, top 90%, 838 students, 91% FRL); Jefferson Davis High School (math 3% / reading 16%, grade F, #258 of 305 statewide, top 85%, 1,522 students, 83% FRL) — zoned schools average 87% FRL vs 70% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 114 active listings in the ZIP; 25 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 56% of comp listings sitting > 30 days — soft ceiling on asking rent; 460 units permitted in Montgomery County in 2024 (37 in 5+ unit buildings).
• Montgomery County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 8 sale attempts since 28y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $140k; 28% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major wind risk, 77% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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?
• 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.