702 Letcher St

Henderson, KY 42420

$128,000D

3 bd · 1.0 ba · 1,204 sqft · Built 1920 · SingleFamily · Active · 38 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,099/mo
• Mortgage (P&I): −$671
• Tax + insurance: −$140
• HOA: −$0
• Vac / Maint / Mgmt: −$231
• Net cashflow: $57/mo
• Annual: $681/yr
• Cap rate: 6.83%
• Cash-on-cash: 1.90%
• DSCR: 1.08
• 1% rule: 0.86%
• Cash to close: $35,840

Investor read

• This is a 3-bed/1.0-bath single-family listed at $128k.
• At list price, monthly cash flow is $57 ($681/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $110k (14.1% below list).
• It's been on market 38 days — a 3% lower offer ($124k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $110k (14.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $885 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#114 in KY, #4,949 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D, amenities F, commute F.
• Henderson County (suburban): math 40% / reading 41% proficiency, ranked #29 of 165 in KY (top 18%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: East Heights Elementary School (math 37% / reading 37%, grade F, #255 of 676 statewide, top 42%, 354 students, 54% FRL); Henderson County North Middle School (math 37% / reading 43%, grade F, #59 of 217 statewide, top 29%, 720 students, 54% FRL); Henderson County High School (math 33% / reading 33%, grade F, #94 of 254 statewide, top 37%, 1,958 students, 44% FRL) — zoned schools at 51% FRL track the district average.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 231 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 92 units permitted in Henderson County in 2024 (0 in 5+ unit buildings).
• Henderson County population projected to shrink 5% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 5 sale attempts since 18y 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.
• Current owner paid $94k; 36% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 38 days. Have you received any prior offers? Is the seller open to a 14% concession, seller financing, or rate buy-down credit?
• Built in 1920 — 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.
• 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.