502 Grant St

Henderson, TX 75652

$25,000C-

2 bd · 1.0 ba · 1,053 sqft · Built 1931 · SingleFamily · Active · 91 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,061/mo
• Mortgage (P&I): −$131
• Tax + insurance: −$52
• HOA: −$0
• Vac / Maint / Mgmt: −$223
• Net cashflow: $655/mo
• Annual: $7,860/yr
• Cap rate: 37.73%
• Cash-on-cash: 112.29%
• DSCR: 6.00
• 1% rule: 4.24%
• Cash to close: $7,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $25k.
• At list price, monthly cash flow is $655 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $25k).
• It's been on market 91 days — a 9% lower offer ($23k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $23k (9.0% below list) — sets the bar for market timing.
• In year one you build about $2k of equity ($173 loan paydown + $2k appreciation (6.1% local appreciation)).
• Location reads 69/100 on livability (#408 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D+, schools D-, crime F.
• Henderson ISD (town): math 30% / reading 35% proficiency, ranked #573 of 826 in TX (top 69%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1931 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 113 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); 4 units permitted in Rusk County in 2024 (0 in 5+ unit buildings).
• Rusk County population projected to shrink 5% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• At projected returns (6.1% appreciation + 3.0% rent growth), your $7k cash investment doubles in ~1 year — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 68% chance of damaging wind over 30y; moderate 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 37.7% vs local median 2.9% in Henderson — 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 91 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1931 — 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.