5205 Heatherstone Dr #0

Baton Rouge, LA 70820

$165,000C

3 bd · 2.5 ba · 1,980 sqft · Built 1989 · Townhouse · Active · 91 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,954/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$228
• HOA: −$187
• Vac / Maint / Mgmt: −$410
• Net cashflow: $263/mo
• Annual: $3,153/yr
• Cap rate: 8.20%
• Cash-on-cash: 6.83%
• DSCR: 1.30
• 1% rule: 1.18%
• Cash to close: $46,200

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $165k.
• At list price, monthly cash flow is $263 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $165k).
• It's been on market 91 days — a 9% lower offer ($150k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $150k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#24 in LA, #4,535 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, health & safety A+; Watch: amenities D, crime F, employment D-.
• East Baton Rouge Parish (urban): math 22% / reading 34% proficiency, ranked #47 of 98 in LA (top 48%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 77% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Highland Elementary School (math 22% / reading 32%, grade F, #359 of 646 statewide, top 57%, 322 students, 62% FRL); Glasgow Middle School (math 29% / reading 40%, grade F, #93 of 218 statewide, top 43%, 550 students, 60% FRL); Liberty High School (math 50% / reading 74%, grade B-, #15 of 265 statewide, top 6%, 1,208 students, 60% FRL) — zoned schools average 60% FRL vs 77% district-wide (17 pts lower); this property's tenant base skews higher-income than the district average.
• Zoned-school proficiency averages 41% at this address vs 28% district-wide (+13 pts) — the actual schools serving this property are materially stronger than the East Baton Rouge Parish average implies; a family-tenant draw the district grade alone would hide.
• Market conditions: Rents rising (+2.8%/yr); 320 active listings in the ZIP; 27 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 48% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,252 units permitted in East Baton Rouge Parish in 2024 (440 in 5+ unit buildings).
• East Baton Rouge County population projected at +4% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 9 sale attempts since 3y ago 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.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.2% vs local median 4.3% in Baton Rouge — 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.
• At $1,954/mo this rent would consume 49% of the median local household income ($47k/yr) (locally 1879% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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.