11159 E Highway 88

Gates, TN 38040

$110,000C+

3 bd · 1.0 ba · 932 sqft · Built 1920 · SingleFamily · Pending · 49 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $956/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$76
• HOA: −$0
• Vac / Maint / Mgmt: −$201
• Net cashflow: $102/mo
• Annual: $1,220/yr
• Cap rate: 7.40%
• Cash-on-cash: 3.96%
• DSCR: 1.18
• 1% rule: 0.87%
• Cash to close: $30,800

Investor read

• This is a 3-bed/1.0-bath single-family listed at $110k.
• At list price, monthly cash flow is $102 ($1k/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 $96k (13.1% below list).
• It's been on market 49 days — a 3% lower offer ($107k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (13.1% below list) — sets the bar for 1% rule.
• In year one you build about $12k of equity ($761 loan paydown + $11k appreciation (10.0% local appreciation)).
• Location reads 53/100 on livability (#384 in TN) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: health & safety C-, schools F, crime F.
• Crockett County (rural): math 31% / reading 32% proficiency, ranked #48 of 139 in TN (top 34%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 17 active listings in the ZIP; 26 units permitted in Crockett County in 2024 (0 in 5+ unit buildings).
• 3 sale attempts since 4y ago; this cycle's ask has dropped $14k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $31k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$42k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 49 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-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.
• 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.