506 Margin St

Brownsville, TN 38012

$115,990D

2 bd · 1.0 ba · 1,080 sqft · Built 1942 · SingleFamily · Active · 366 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,148/mo
• Mortgage (P&I): −$608
• Tax + insurance: −$98
• HOA: −$0
• Vac / Maint / Mgmt: −$241
• Net cashflow: $201/mo
• Annual: $2,413/yr
• Cap rate: 8.37%
• Cash-on-cash: 7.43%
• DSCR: 1.33
• 1% rule: 0.99%
• Cash to close: $32,477

Investor read

• This is a 2-bed/1.0-bath single-family listed at $116k.
• At list price, monthly cash flow is $201 ($2k/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 $115k (1.0% below list).
• It's been on market 366 days — a 12% lower offer ($102k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $102k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $802 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 54/100 on livability (#374 in TN) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, health & safety A+, housing A-; Watch: crime F, amenities F, commute F.
• Haywood County (town): math 4% / reading 10% proficiency, ranked #137 of 139 in TN (top 99%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Anderson Early Childhood (384 students, 0% FRL); Haywood Middle School (math 6% / reading 7%, grade F, #284 of 333 statewide, top 86%, 365 students, 0% FRL); Haywood High School (math 2% / reading 14%, grade F, #288 of 332 statewide, top 87%, 820 students, 0% FRL) — zoned schools average 0% FRL vs 68% district-wide (68 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1942 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 102 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals lingering (median 47d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 22 units permitted in Haywood County in 2024 (0 in 5+ unit buildings).
• Haywood County population projected at -29% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 5y ago; this cycle's ask has dropped $13k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $65k; list at $116k implies a 78% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.4% vs local median 3.8% in Brownsville — 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

• It's been on market 366 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1942 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• 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 F 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?
• 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.