606 S Chestnut St

Lampasas, TX 76550

$120,000C

2 bd · 1.0 ba · 1,008 sqft · Built 1950 · SingleFamily · Pending · 95 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,138/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$106
• HOA: −$0
• Vac / Maint / Mgmt: −$239
• Net cashflow: $164/mo
• Annual: $1,967/yr
• Cap rate: 7.93%
• Cash-on-cash: 5.85%
• DSCR: 1.26
• 1% rule: 0.95%
• Cash to close: $33,600

Investor read

• This is a 2-bed/1.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $164 ($2k/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 $114k (5.1% below list).
• It's been on market 95 days — a 9% lower offer ($109k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $109k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $830 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#123 in TX, #3,832 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, employment D, crime F.
• Lampasas ISD (rural): math 42% / reading 46% proficiency, ranked #278 of 826 in TX (top 34%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 342 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals leasing fast (median 13d on market — plan ~1-2 weeks tenant-placement turnaround); 18 units permitted in Lampasas County in 2024 (0 in 5+ unit buildings).
• Lampasas County population projected at +10% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 6 sale attempts since 3y ago; this cycle's ask has dropped $10k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 7.9% vs local median 2.0% in Lampasas — 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 95 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1950 — 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.