814 Holmes St

Frankfort, KY 40601

$80,000B-

2 bd · 1.0 ba · 956 sqft · Built 1973 · SingleFamily · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,052/mo
• Mortgage (P&I): −$420
• Tax + insurance: −$91
• HOA: −$0
• Vac / Maint / Mgmt: −$221
• Net cashflow: $321/mo
• Annual: $3,846/yr
• Cap rate: 11.10%
• Cash-on-cash: 17.17%
• DSCR: 1.76
• 1% rule: 1.31%
• Cash to close: $22,400

Investor read

• This is a 2-bed/1.0-bath single-family listed at $80k.
• At list price, monthly cash flow is $321 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $80k).
• It's been on market 23 days — a 2% lower offer ($79k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $79k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $553 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#111 in KY, #4,772 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B; Watch: employment C-, amenities F, health & safety F.
• Franklin County (town): math 25% / reading 37% proficiency, ranked #89 of 165 in KY (top 54%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Peaks Mill Elementary (math 30% / reading 36%, grade F, #338 of 676 statewide, top 50%, 410 students, 64% FRL); Elkhorn Middle School (math 17% / reading 33%, grade F, #184 of 217 statewide, top 87%, 737 students, 60% FRL); Franklin County High School (math 27% / reading 37%, grade F, #97 of 254 statewide, top 46%, 960 students, 48% FRL).
• Market conditions: Rents rising fast (+6.5%/yr); 306 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 75% of comp listings sitting > 30 days — soft ceiling on asking rent; 123 units permitted in Franklin County in 2024 (0 in 5+ unit buildings).
• Franklin County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 8 sale attempts since 14y 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.
• At projected returns (-3.0% appreciation + 6.5% rent growth), your $22k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.1% vs local median 3.3% in Frankfort — 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 1973 — 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 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?
• 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.