161 Gum Bottom Road 161

Richmond, KY 40385

$190,000D

3 bd · 2.0 ba · 1,720 sqft · Built 1997 · SingleFamily · Active · 26 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,203/mo
• Mortgage (P&I): −$996
• Tax + insurance: −$317
• HOA: −$0
• Vac / Maint / Mgmt: −$253
• Net cashflow: $-363/mo
• Annual: $-4,353/yr
• Cap rate: 4.00%
• Cash-on-cash: -8.18%
• DSCR: 0.64
• 1% rule: 0.63%
• Cash to close: $53,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $190k.
• At list price, monthly cash flow is $-363 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $138k (27.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $120k (36.7% below list).
• It's been on market 26 days — a 2% lower offer ($187k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $120k (36.7% below list) — sets the bar for 1% rule.
• In year one you build about $9k of equity ($1k loan paydown + $8k appreciation (4.3% local appreciation)).
• Location reads 69/100 on livability (#163 in KY) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A; Watch: amenities F, commute F, employment F.
• Madison County (town): math 31% / reading 47% proficiency, ranked #35 of 165 in KY (top 21%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Kingston Elementary School (math 30% / reading 39%, grade F, #301 of 676 statewide, top 48%, 618 students, 50% FRL); Farristown Middle School (math 43% / reading 57%, grade C, #23 of 217 statewide, top 11%, 466 students, 48% FRL); Madison Southern High School (math 32% / reading 42%, grade F, #58 of 254 statewide, top 27%, 1,210 students, 50% FRL).
• Market conditions: 24 active listings in the ZIP; 453 units permitted in Madison County in 2024 (64 in 5+ unit buildings).
• Madison County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 4, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 4.0% vs local median 3.0% in Richmond — 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

• 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?
• 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?
• 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.