2 bd · 1.0 ba ·
1,170 sqft ·
Built 1983
· SingleFamily
· Pending
· 63 DOM
Cashflow @ list (25.0% down · 7.5%)
Estimated rent
$1,747/mo
Mortgage (P&I)
−$734
Tax + insurance
−$373
HOA
−$0
Vac / Maint / Mgmt
−$367
Net cashflow
$273/mo
Annual
$3,274/yr
Cap rate
9.20%
Cash-on-cash
10.39%
DSCR
1.46
1% rule
1.25%
Cash to close
$39,200
Investor read
This is a 2-bed/1.0-bath single-family listed at $140k.
At list price, monthly cash flow is $273 ($3k/yr) — positive.
The deal already cash-flows at list — no discount required.
Meets the 1% rule at list price ($2k rent vs $140k).
It's been on market 63 days — a 6% lower offer ($132k) is reasonable based on typical stale-listing flexibility.
Recommended offer: $132k (6.0% below list) — sets the bar for market timing.
Local home prices are declining (-3.0%/yr); year-one equity from $968 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
Location reads 75/100 on livability (#142 in TX, #4,037 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, crime D, commute F.
Abilene ISD (urban): math 32% / reading 34% proficiency, ranked #575 of 826 in TX (top 70%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
Watch-outs: flood insurance adds $66/mo.
Market conditions: Rents rising fast (+32.1%/yr); 109 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); 508 units permitted in Taylor County in 2024 (0 in 5+ unit buildings).
Taylor County population projected at +16% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
3 sale attempts 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.
At projected returns (-3.0% appreciation + 8.0% rent growth), your $39k cash investment doubles in ~8 years — after that, you're playing with house money.
Climate carrying-cost: major flood risk; severe wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
Cap rate 9.2% vs local median 6.7% in Abilene — 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.
This rent runs 33% of the median local income ($63k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.
Questions for listing agent
It's been on market 63 days. Have you received any prior offers? Is the seller open to a 6% 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?
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 D 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.
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