820 42nd Ave N

Nashville-Davidson metropolitan government (balance), TN 37209

$539,000F

3 bd · 2.5 ba · 1,472 sqft · Built 2026 · Townhouse · Active · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,294/mo
• Mortgage (P&I): −$2,827
• Tax + insurance: −$501
• HOA: −$245
• Vac / Maint / Mgmt: −$482
• Net cashflow: $-1,760/mo
• Annual: $-21,123/yr
• Cap rate: 2.37%
• Cash-on-cash: -14.00%
• DSCR: 0.38
• 1% rule: 0.43%
• Cash to close: $150,920

Investor read

• This is a 3-bed/2.5-bath townhouse listed at $539k. Condition is rated excellent.
• At list price, monthly cash flow is $-2k ($-21k/yr) — negative.
• To cash-flow at today's rent, offer at most $228k (57.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $229k (57.4% below list).
• It's been on market 22 days — a 2% lower offer ($531k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $228k (57.7% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads: area grade F — affects rentability + tenant quality, not the cash-flow math above.
• Davidson County (urban): math 12% / reading 19% proficiency, ranked #126 of 139 in TN (top 91%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Cockrill Elementary (math 2% / reading 12%, grade F, #863 of 952 statewide, top 92%, 275 students, 0% FRL); Haynes Middle (math 0% / reading 3%, grade F, #332 of 333 statewide, top 100%, 291 students, 0% FRL); Pearl-Cohn High (math 2% / reading 12%, grade F, #294 of 332 statewide, top 91%, 604 students, 0% FRL) — zoned schools average 0% FRL vs 66% district-wide (66 pts lower); this property's tenant base skews higher-income than the district average.
• Market conditions: Rents soft (-0.6%/yr); 766 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 80d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 6,873 units permitted in Davidson County in 2024 (4,138 in 5+ unit buildings).
• Davidson County population projected at +42% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 10 sale attempts; this cycle's ask has dropped $35k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 2.4% vs local median 3.0% in Nashville-Davidson metropolitan government (balance) — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 34% of the median local income ($81k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.