13946 E Hwy 31 E

New Chapel Hill, TX 75705

$178,000C+

3 bd · 1.0 ba · 1,472 sqft · Built 1961 · Other · Pending · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,038/mo
• Mortgage (P&I): −$933
• Tax + insurance: −$253
• HOA: −$0
• Vac / Maint / Mgmt: −$428
• Net cashflow: $424/mo
• Annual: $5,083/yr
• Cap rate: 9.15%
• Cash-on-cash: 10.20%
• DSCR: 1.45
• 1% rule: 1.14%
• Cash to close: $49,840

Investor read

• This is a 3-bed/1.0-bath other listed at $178k.
• At list price, monthly cash flow is $424 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $178k).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• In year one you build about $3k of equity ($1k loan paydown + $2k appreciation (1.0% local appreciation)).
• Location reads 57/100 on livability (#1,275 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+; Watch: employment D, crime D-, amenities F.
• Chapel Hill ISD (rural): math 25% / reading 33% proficiency, ranked #650 of 826 in TX (top 79%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 64% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: W L Kissam Int (math 25% / reading 32%, grade F, #1,122 of 1,662 statewide, top 69%, 696 students, 81% FRL); Chapel Hill J H (math 27% / reading 35%, grade F, #1,015 of 1,662 statewide, top 62%, 502 students, 77% FRL); Chapel Hill H S (math 21% / reading 35%, grade F, #1,170 of 1,632 statewide, top 72%, 1,063 students, 75% FRL).
• Market conditions: 29 active listings in the ZIP; 595 units permitted in Smith County in 2024 (45 in 5+ unit buildings).
• Smith County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (1.0% appreciation + 3.0% rent growth), your $50k cash investment doubles in ~6 years — after that, you're playing with house money.
• By year 10, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 68% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• Built in 1961 — 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 D 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.