91 E 2nd St E

Parsons, TN 38363

$139,900D

2 bd · 1.0 ba · 1,055 sqft · Built 1943 · Other · Pending · 164 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $946/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$100
• HOA: −$0
• Vac / Maint / Mgmt: −$199
• Net cashflow: $-86/mo
• Annual: $-1,032/yr
• Cap rate: 5.56%
• Cash-on-cash: -2.63%
• DSCR: 0.88
• 1% rule: 0.68%
• Cash to close: $39,172

Investor read

• This is a 2-bed/1.0-bath other listed at $140k.
• At list price, monthly cash flow is $-86 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $125k (10.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $95k (32.4% below list).
• It's been on market 164 days — a 12% lower offer ($123k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $95k (32.4% below list) — sets the bar for 1% rule.
• In year one you build about $15k of equity ($967 loan paydown + $14k appreciation (10.0% local appreciation)).
• Location reads 59/100 on livability (#288 in TN) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A-; Watch: health & safety C-, crime F, amenities F.
• Decatur County (rural): math 45% / reading 33% proficiency, ranked #19 of 139 in TN (top 14%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Parsons Elementary (math 52% / reading 47%, grade D, #119 of 952 statewide, top 14%, 376 students, 0% FRL); Decatur County Middle School (math 48% / reading 28%, grade F, #51 of 333 statewide, top 16%, 426 students, 0% FRL); Riverside High School (math 27% / reading 27%, grade F, #104 of 332 statewide, top 33%, 460 students, 0% FRL) — zoned schools average 0% FRL vs 50% district-wide (50 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1943 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 90 active listings in the ZIP; 10 units permitted in Decatur County in 2024 (0 in 5+ unit buildings).
• Decatur County population projected at -16% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 5 sale attempts since 5y ago; this cycle's ask has dropped $9k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $80k; list at $140k implies a 75% gain — meaningful room to come down on a strong offer.
• By year 3, paydown + projected appreciation supports a ~$38k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• 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.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 164 days. Have you received any prior offers? Is the seller open to a 32% concession, seller financing, or rate buy-down credit?
• Built in 1943 — 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?