Louisville agent here, mostly investors, and a lot of them out of state. The question I'm getting most from people shopping rentals here: do Louisville rentals still cash flow with rates over 7%?

Short answer: yes, but only if you buy right. An average rental at an average price will usually qualify for a DSCR loan. It just won't put much money in your pocket. Here's the math with real October rents, rates and taxes. Quick note up front: I'm a realtor, not a lender. The loan terms below are typical ranges from lender rate sheets this month, not quotes.

What the DSCR lender looks at: monthly rent divided by PITIA (principal, interest, taxes, insurance and any association dues). 1.0 means the rent exactly covers the payment. 1.0 is the common floor, and 1.25 or better gets the best pricing.

• Rates: roughly 6.5% to 9%. A strong file (740+ credit, 25% down, DSCR of 1.0 or better) is landing around 7% to 7.5%. For comparison, Freddie Mac's 30-year average for regular homebuyers was 7.32% last week.

• Down payment: usually 20% to 25%. Duplexes up to fourplexes often need 25%.

• Reserves around six months, and prepayment penalties are common (5-4-3-2-1).

• The rent the lender uses is usually the lower of your lease and the appraiser's market rent. Don't count on credit for above-market rent.

Louisville rents: Zillow has single-family homes across the metro at $1,701 in September, up 3% from a year ago. Two-bedroom apartments run about $1,200 to $1,233 and are basically flat for the year. Rents are growing 0% to 3% depending on the source, so the deal has to work on today's rent, not the rent you hope to get in two years.

Example one: a $300,000 duplex. 25% down, 7.75%, property taxes about 1.25% a year (roughly $312 a month, and investors don't get the homestead exemption), landlord insurance about $3,200 a year. PITIA comes to about $2,191. Two 2-bedrooms at about $1,200 each is $2,400. DSCR about 1.10. It qualifies. Now set aside 15% of rent for vacancy and repairs and you're at about -$151 a month.

Example two: a $200,000 single-family renting at the metro average of $1,701. PITIA about $1,474. DSCR about 1.15. After the same 15%, about -$28 a month.

Same rent, same rate, lower price:

• Duplex at $260,000: DSCR 1.24, about +$105 a month

• Duplex at $250,000: DSCR 1.28, about +$170

• House at $180,000: DSCR 1.26, about +$100

• House at $170,000: DSCR 1.33, about +$165

Insurance is held flat to keep it simple, and management isn't included. If you hire a property manager, take off another 8% to 10% of rent.

So here's the answer at 7%+ rates: Louisville rentals cash flow when you buy them about 10% to 17% under the prices in those examples. That's the whole game. "It qualifies" and "it cash flows" are two different sentences.

Why I think that's realistic right now: duplexes up to fourplexes (I count anything with two or more units as small commercial) are sitting. Jefferson County had 168 of them for sale in September, up from 113 a year ago. That's about 9.9 months of supply, and it more than doubled since February. Seventeen sold in September at a median of $300,000. With almost ten months of supply, sellers take offers they would have laughed at a year ago. Most of what's listed won't make sense at the asking price. Some of it will at the right price.

The honest downside: a lot of our 2 to 4 unit stock is old. Condition hurts out-of-state buyers more than price does. Check rents on the actual street, not the metro average, get a real insurance quote before your inspection window closes, and budget for big-ticket items like roofs and HVAC separately from everyday repairs.

Two questions for the group. For anyone buying with DSCR loans right now, what rate and DSCR are you actually getting quoted, and what's your floor before you walk? And if you're looking at Louisville, post a price and a rent below and I'll run what it pencils to at today's rates right here in the thread.