401 Kerr St

Edna, TX 77957

$89,000C

3 bd · 1.0 ba · 1,200 sqft · Built 1956 · SingleFamily · Active · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $900/mo
• Mortgage (P&I): −$467
• Tax + insurance: −$601
• HOA: −$0
• Vac / Maint / Mgmt: −$189
• Net cashflow: $-357/mo
• Annual: $-4,280/yr
• Cap rate: 7.24%
• Cash-on-cash: 3.37%
• DSCR: 1.15
• 1% rule: 1.01%
• Cash to close: $24,920

Investor read

• This is a 3-bed/1.0-bath single-family listed at $89k.
• At list price, monthly cash flow is $-357 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $33k (63.0% below list).
• Meets the 1% rule at list price ($900 rent vs $89k).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $33k (63.0% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $615 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#254 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities F, commute F.
• Edna ISD (town): math 45% / reading 39% proficiency, ranked #335 of 826 in TX (top 41%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Edna El (math 45% / reading 38%, grade F, #1,437 of 4,322 statewide, top 34%, 222 students, 56% FRL); Edna J H (math 46% / reading 38%, grade D-, #572 of 1,662 statewide, top 36%, 334 students, 60% FRL); Edna H S (math 47% / reading 47%, grade D-, #591 of 1,632 statewide, top 38%, 431 students, 61% FRL) — zoned schools at 59% FRL track the district average.
• Watch-outs: flood insurance adds $427/mo; built in 1956 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 75 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent.
• Jackson County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $2k; list at $89k implies a 5462% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.2% vs local median 2.8% in Edna — 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• Built in 1956 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.