4221 Lindsey Gap Rd

Cosby, TN 37722

$199,000D+

4 bd · 2.0 ba · 672 sqft · Built 1993 · Other · Active · 40 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,502/mo
• Mortgage (P&I): −$1,044
• Tax + insurance: −$398
• HOA: −$0
• Vac / Maint / Mgmt: −$315
• Net cashflow: $-255/mo
• Annual: $-3,065/yr
• Cap rate: 5.15%
• Cash-on-cash: -4.07%
• DSCR: 0.82
• 1% rule: 0.75%
• Cash to close: $55,720

Investor read

• This is a 4-bed/2.0-bath other listed at $199k.
• At list price, monthly cash flow is $-255 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $162k (18.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $150k (24.5% below list).
• It's been on market 40 days — a 3% lower offer ($193k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $150k (24.5% below list) — sets the bar for 1% rule.
• In year one you build about $21k of equity ($1k loan paydown + $20k appreciation (10.0% local appreciation)).
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Cocke County (rural): math 21% / reading 21% proficiency, ranked #112 of 139 in TN (top 81%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Smoky Mountain Elementary (math 37% / reading 27%, grade F, #369 of 952 statewide, top 42%, 178 students, 0% FRL); Cosby High School (math 8% / reading 27%, grade F, #215 of 332 statewide, top 67%, 326 students, 0% FRL) — zoned schools average 0% FRL vs 71% district-wide (71 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: 171 active listings in the ZIP; 13 units permitted in Cocke County in 2024 (0 in 5+ unit buildings).
• Cocke County population projected at -19% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• By year 2, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe flood risk; major wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.2% vs local median 2.3% in Cosby — 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?
• It's been on market 40 days. Have you received any prior offers? Is the seller open to a 25% concession, seller financing, or rate buy-down credit?
• 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.
• 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.