314 Burley Ave

Lexington-Fayette, KY 40503

$200,000C

3 bd · 1.0 ba · 1,218 sqft · Built 1920 · SingleFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,862/mo
• Mortgage (P&I): −$1,049
• Tax + insurance: −$148
• HOA: −$0
• Vac / Maint / Mgmt: −$391
• Net cashflow: $274/mo
• Annual: $3,285/yr
• Cap rate: 7.94%
• Cash-on-cash: 5.87%
• DSCR: 1.26
• 1% rule: 0.93%
• Cash to close: $56,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $200k.
• At list price, monthly cash flow is $274 ($3k/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 $186k (6.9% below list).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $186k (6.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads: area grade C — affects rentability + tenant quality, not the cash-flow math above.
• Fayette County (urban): math 35% / reading 45% proficiency, ranked #27 of 165 in KY (top 16%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Picadome Elementary School (math 32% / reading 42%, grade F, #255 of 676 statewide, top 42%, 430 students, 56% FRL); Morton Middle School (math 41% / reading 58%, grade C, #25 of 217 statewide, top 12%, 705 students, 43% FRL); Lafayette High School (math 47% / reading 54%, grade D+, #10 of 254 statewide, top 4%, 2,432 students, 38% FRL) — zoned schools at 46% FRL track the district average.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.4%/yr); 78 active listings in the ZIP; 29 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 1,036 units permitted in Fayette County in 2024 (542 in 5+ unit buildings).
• Fayette County population projected at +35% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 7.9% vs local median 3.8% in Lexington-Fayette — 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

• 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.
• 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.