1806 N Culberson St

Gainesville, TX 76240

$86,900B+

2 bd · 2.0 ba · 760 sqft · Built 1952 · SingleFamily · Pending · 29 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,312/mo
• Mortgage (P&I): −$456
• Tax + insurance: −$202
• HOA: −$0
• Vac / Maint / Mgmt: −$276
• Net cashflow: $379/mo
• Annual: $4,553/yr
• Cap rate: 11.53%
• Cash-on-cash: 18.71%
• DSCR: 1.83
• 1% rule: 1.51%
• Cash to close: $24,332

Investor read

• This is a 2-bed/2.0-bath single-family listed at $87k.
• At list price, monthly cash flow is $379 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $87k).
• It's been on market 29 days — a 2% lower offer ($86k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $86k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $601 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#602 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B+; Watch: amenities F, commute F, employment F.
• Gainesville ISD (rural): math 33% / reading 29% proficiency, ranked #606 of 826 in TX (top 73%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 72% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: W E Chalmers El (math 28% / reading 24%, grade F, #2,954 of 4,322 statewide, top 69%, 716 students, 67% FRL); Gainesville J H (math 32% / reading 38%, grade F, #842 of 1,662 statewide, top 51%, 426 students, 71% FRL); Gainesville H S (math 42% / reading 22%, grade F, #1,044 of 1,632 statewide, top 66%, 863 students, 47% FRL).
• Watch-outs: built in 1952 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 461 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 190 units permitted in Cooke County in 2024 (0 in 5+ unit buildings).
• 5 sale attempts since 5y 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 + 3.0% rent growth), your $24k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.5% vs local median 3.6% in Gainesville — 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 1952 — 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?
• 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.